Next on the chopping block - Providence Journal

As one might imagine, the last two replies I completely agree with & support.

 

But, but, if the profit margin falls to 28 percent, no one will want to invest in it!

 

You know, I love the argument that papers shouldn't cut jobs. Obviously.

But name me one that hasn't. In fact, name me one that hasn't solely through attrition.

I'm betting I can count the number on one hand, nationwide. OK, maybe two hands.

I'd like a unicorn and daily rainbows, too, but it doesn't mean it's happening.

 

The argument isn't that a paper shouldn't cut jobs. Let's face it, we can all do a little more with less if we're being honest.

But there's a point when you've cut and cut and cut and suddenly a little bleeding leads to a full-fledged murder of your product.

When my paper began layoffs in 2007, first they trimmed down the sheer number of reporters and the answer we had was to write more. It wasn't a big deal because we weren't being utilized correctly anyway.

Then they got rid of the photographers and it wasn't a big deal because we learned how to take our own photos and actually got pretty good at it. But when you add another two rounds of reporter cuts, lose any and all editorial assistants, close your local officers, fire receptionists, eliminate editor papers, consolidate staffs and then cut any remaining reporters, it all adds up.

People are starting to routinely complain about the coverage now and, at least twice a week, we're getting emails threatening to cancel because the paper wasn't what it was a year ago, two years ago, etc.

The Projo is no different. Nor are any other papers.

You can afford to trim a little and make people work a little extra than maybe they used to be used to. But at a certain point, you reach your maximum leanness and, surprise, surprise, it's still not enough in the eyes of the assholes that run newspapers.

Mark my words. This layoff is not going to solve Projo's problems. What this is going to do is lead to a lesser paper and while it might not be noticeable right away, it will start to become clear to readers that the $1.00 they spent on a paper yesterday is getting them a lot less today in terms of quality. And, like it or not, at some point the people who run papers like mine and like the Projo and like any others that thinks cuts are the answer are going to be wondering why they can't stem the tide of readers jumping off the ship and why they inevitably have to close down after going out of business.

Editorial staff positions shouldn't be looked at as a burden to a newspaper's bottom line because, without the work we do, there would be no newspaper. And the Projo is going to learn that the hard way.

 

I figure November and December might be pretty fierce in all mediums with the Olys and election over - book the money and reduce the expenses before the end of the year. Usually happens with Holiday advertising anyway.

 

Don't forget those business assholes MUST have their millions in bonuses while the boots on the ground get a foot in the ass or a paycut, if they're lucky.

 

schiezainc, I agree with everything you wrote. Just saying, pretty much every paper in the country is dealing with the same issues, and has been for years now, not just ProJo.

 

And that's fair. But, uh, this thread is about the Projo so, uh, yeah.

 

Seem? So, you're just guessing, right?

As for revenue, do you think they might have estimates for where it's going to be 12 months from now?

And, let's use the figure schiezainc mentioned and assume the average salary is $50,000 per employee. You realize the average cost per employer is higher than their salary, right?

 

Taking from Scheiz's figures, let's say the average cost is $75K (50K salary, $25K bennies). Which means their cost is about $35 million.

Then you have newsprint costs, which is usually No. 2 in expenses. I don't know how much of a percentage a paper pays for newsprint, but I found this one article from AJR from 2001 that says anywheres from 15 (small papers) to 25 percent (large papers):

http://ajr.org/article.asp?id=2365

So let's say they spend 25 percent, or $24 million on newsprint. The article also had 10-20 percent for circulation costs (trucks, deliveries, etc). So we'll put another 20 percent: $19 million. Again, this is also an 11-year-old story. The Internet may have cut this back some, but for this discussion, we'll keep it.

For argument's sake, let's add another $5 million to keep the lights on and for any miscellaneous expenses that we haven't thought of. So that's $84 million.

They're still making $12 million, or about a 12.5 percent profit on the $96 million a year business. Most businesses would kill for a margin like that.

Meanwhile, cut 5 percent of the workforce, save $1.75 million. Sounds nice and all, but see if the profits drop further the next year because quality goes down and the revenue goes down as well. Say next year, the paper only makes $10 million because people don't want to advertise or buy it. Then they've lost more money than they would have gotten if they'd kept the jobs.