25 July 2014

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‘Axeman’ publisher hits back in row over job cuts

A newspaper boss branded an ‘axeman” by the National Union of Journalists has issued a robust response to a protest letter over job cuts.

As reported on HTFP this morning, the NUJ chapel at the Leicester Mercury wrote an open letter to the newspaper’s publisher David Simms over plans to cut 11 editorial roles.

It accused him of adopting a “cavalier attitude” towards editorial jobs and endangering the future of the business.

However Mr Simms has now issued a point-by-point response to the union’s claims, pointing out that other departments have had to undergo bigger staff reductions than editorial.

He wrote:  “Editorial costs represent the highest percentage of our total cost base and this proportion has grown over time as other costs have been managed downwards to a much greater extent.

“Since 2007/08 people and people related costs across all other departments have reduced by c30pc compared with the 24pc reduction in editorial.”

Mr Simms said there were no further changes planned at present but could not rule out more job losses in future.

It is understood that some of the current planned reduction in editorial headcount will be met through voluntary redundancy. However managers are not yet in a position to guarantee no compulsory job cuts.

The union’s open letter was reproduced in full on HTFP earlier today and can be read here.

Here is Mr Simms response in full.

DAVID SIMMS’ RESPONSE TO THE NUJ

  • The editorial plans are 100% owned by the Leicester Mercury. Put forward by Richard Bettsworth and endorsed by me. These plans are necessary given the continued decline in both advertising revenue and circulation volume. Revenues in the past 5 years have declined by 45% with circulation volume down 30%
  • Editorial are not solely bearing the brunt of change. It is however, inappropriate to outline to you plans/changes affecting other people/departments. In the past 12 months other departments have been affected by change/staff reductions with editorial over that period least affected.
  • Editorial costs represent the highest percentage of our total cost base and this proportion has grown over time as other costs have been managed downwards to a much greater extent. Since 2007/08 people and people related costs across all other departments have reduced by c30% compared with the 24% reduction in editorial.
  • No one can guarantee what the future looks like – with both cyclical and structural change happening in the market future job losses cannot be ruled out. However, other than the plans you know about we have no further/immediate planned changes.
  • We anticipate the current run rate on ad revenues continuing over the next 24 months. We are however doing our utmost to address the decline. The launch of the Business Magazine is one of the changes made which is showing growth.
  • Changes planned in editorial are designed to protect both content and quality securing the long term viability of the paper.
  • The economic environment continues to be very difficult. It is unlikely that this will change in the near term. Our priorities are to continue with the change programme designed to make us more efficient and agile, while at the same time investing in those key areas of growth so important to our future. To carry on as we are is simply not an option.

8 Comments

  1. Cherrywonder

    “To carry on as we are is simply not an option.”

    Yes, it is. It is a question of priorities – and as we can see, at the top of these is the intention to carry on regardless with the “change programme.”

    This so-called “robust response” is simply a bunch of buzz words limply flapping in the breeze.

    Even a cursory examination would suggest that cutting a further 11 journalists from the payroll is scarcely likely to “protect quality and content.”

    Nor is it clear how it will make the title “more efficient and agile”.

    Just words. Empty, meaningless words.

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  2. Jules

    I can only see a ‘tail-spin’ happening. Cut the quality, and those revenue figures will fall too. Less revenue will mean more cuts in one year. More cuts equal less quality, etc etc.

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  3. Rupert Bear

    I occasionally run a seminar for groups of Masters Degree students (often in the East Midlands, although not in Leicester).

    My usual ice-breaker is to go around the room and ask them how they as individuals receive news – ie via print, TV, radio, internet, tweets, etc etc

    It is not unusual to find that there is not a single person within a group of up to 16 individuals who buys a newspaper. One or two will say they read The Metro if it is handed to them.

    I wish I was as confident as some of the posters on this site that a return to local ownership, larger editorial staffs, ‘quality’ copy, and all the other suggested panacea would do the trick.

    I suspect the newspaper business has already lost at least one generation.

    Like the nation as a whole, managements are in the business of managing decline, struggling tokeep the ship afloat for as long as possible. You can never really go back.

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  4. Curious

    At least Mr Simms has responded – which is better than the usual deafening silence from most management.
    I don’t supppose the union’s view and the response will see the light of day in the paper itself though.

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  5. Rob

    I know it’s semantics, but when he talks about a 30% cut across all other deptartments compared to 24% in editorial, does he main
    a) a 30% cut in each of the other deaprtments

    or

    b) a 30% cut across combined departments.

    If it’s b) I’d imagine a press closing would be enough to skew results sufficiently if the company wants to take an average figure for all departments.

    66 jobs in 2009, I think.

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  6. Cherrywonder

    It would be comforting to imagine that “management” have been brought kicking and screaming to the conclusion that the rise of the internet makes slashing editorial departments the only available course of action for survival.

    The truth is of course that they were cutting newsroom numbers to ribbons long before the world wide web was invented. All we are witnessing now is the continuation of the taste for blood newspaper publishers developed in the mid-80s.

    The rabid run of cost-cutting has had more to do with publishers’ over-leveraged buy-outs and the need to service high-interest and ill-advised corporate debt. Not to mention shareholders’ lust for dividends.

    The web is the excuse, Rupert Bear. Not the reason.

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  7. stillabeliever

    Cherrywonder’s last point may be correct for many publishers.

    However, Northcliffe, given its ownership and heritage, should not be suffering any financial ills from leveraged buy-outs or high-interest charges.

    The reality is that the business and the world have changed, consumers and advertisers are doing different things with their time and money (per Rupert Bear).

    Mr Sims, his team, and many others, need to find a way of attracting customers and making money in the 21st century.

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  8. Amanda

    Nice of him to blame the acting editor in his first point.
    From what I know of the place, there have been in the past a few roles in editorial which were hard to justify – people doing not very useful things for too much pay.
    However, the vast majority of staff there work exceptionally hard despite already being stretched. Cutting this many jobs will increase workloads further so it is inevitble that quality will suffer.
    I imagine the Mercury is still very profitable – like most papers, I suspect it has margins over 20%.
    But all the accountants ruining our industry can see is the fall in profits.
    So they are knee-jerking wildly and taking the tempting but short-term option of cutting bums on seats.
    In the medium to long term, it will lead to an faster fall in sales as quality suffers. This will then lead to advertisers wanting to pay less for lower market penetration.
    So then to combat this they’ll try to sack more staff, or increase the quantity of now cheaper adverts at the expense of other content, or reduce the number of pages etc etc
    But here’s an idea – when one revenue stream starts to shrink, try to stablise that contraction while investing in other revenue streams.
    Because sacrificing the quality of your product in difficult times is madness, particularly when applied to news.
    But of course, accountants have been baffled by the inability to put a measurable value on news for years.

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