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LITTLE ROCK The Arkansas Democrat-Gazette is laying off as many as 60 people, including seven who work in newsrooms.

The paper, which has about 1,300 employees, informed workers Monday. The Arkansas Democrat-Gazette is the largest newspaper in the state.

Paul Smith, president of the Arkansas Democrat-Gazette Inc., says the paper has eliminated 30 to 40 jobs in Little Rock and about 20 in its northwest Arkansas bureau. The cut amounts to a reduction of about 4.5 percent.

Last summer, the newspaper imposed a hiring freeze and also froze wages. The paper in January asked for volunteers to work fewer hours and about 25 employees elected to work 32 hours a week.

Smith said advertising revenue is continuing to drop throughout the industry. He also said that the paper is losing ad sales due to the sale of Little Rock-based Alltel Corp. and the bankruptcy of Circuit City and Goody's clothing stores. He said those accounts alone will cost the Democrat-Gazette about $1.2 million in 2009.

Smith said positions were eliminated in every area of the company's operations.

"It's not so much ... a desire to make a lot of money, but it's just a desire to not get ourselves into such a hole ... that we can't come out of it," Smith said. "Nobody knows how much longer this is going to last and how much worse it's going to get."