By: E&P Staff Stung by declining advertising revenue and increasing gas and newsprint prices, the Arkansas Democrat-Gazette is imposing a salary and hiring freeze in all its departments -- but hopes to avoid laying off any of its 1,316 employees.
In a memo to employees this week, Paul Smith, president of the Hussman family-owned Wehco Media Inc., said the paper is eliminating salary increases for the rest of the year, and will try to reduce costs through attrition. "Temporarily" the departing employee will not be replaced "unless absolutely necessary," he wrote.
"While many newspaper companies have had several rounds of layoffs during the past several years, we have resisted doing this and we hope we can continue to do so, but we must keep our payroll costs from going higher," Smith wrote.
Smith said ad revenue at the Little Rock-based newspaper is down for the second consecutive year, and newsprint costs, which have risen 24% since last year, look to add $4 million to the cost of publishing in 2008.
The paper has been especially impacted by the increase in gasoline, he added: "We have 1,132 newspaper carriers under contract. These carriers, along with our bundle haulers, drive more than 1.6 million miles per month to deliver our newspaper to our subscribers."
Smith said the Democrat-Gazette has "many things going for us," including the highest Sunday penetration in a city zone than any other metro daily, and more people reading the paper in Central Arkansas on a typical day than watch the Super Bowl.
'We realize our employees are responsible for much of our success," he wrote. "Knowing that makes this decision even more difficult. However, if we don't act prudently now the cost to our employees could be greater."
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