King County Journal to cut jobs and suspend wage increases

By Kristina Shevory
Seattle Times Eastside business reporter

8/30/03

King County, WA - The King County Journal newspaper will cut 19½ full-time jobs, suspend wage increases and freeze its 401(k) match to bring the newspaper back to profitability, the publisher said yesterday.

The layoffs of managers and union staff will be evenly split between the paper's Kent and Bellevue offices. They are effective Oct. 3. The reduction will cut staff to 325 employees.

"This is totally a reflection of a pretty lousy economy," said Peter Horvitz, president and chief executive officer of Horvitz Newspapers, which publishes the Journal and several weekly newspapers. "We have to adjust our expenses in line with our revenues."

To save money, the newspaper also will stop publishing different editions beginning Oct. 6 and limit zoning changes to some advertising and high-school sports.

The Journal is negotiating a new contract with the Newspaper Guild, which represents about 90 employees in the company's Bellevue office.

"We don't know if these layoffs are economically justified or not," said Doug Margeson, who is a reporter at the King County Journal and a guild leader. "We can't respond to specific economics because we don't have them."

The reductions, which will pare expenses by about 6 percent, are one of several cost-cutting measures the Bellevue company has undertaken since February.

This month, the home-delivery price of the paper was increased 30 cents a week to $2.80, and the paper has been eliminating nonpayroll expenses, such as organizational memberships.

Daily newspapers throughout the country have been hard-hit by the falloff in classified and display advertising and the rise of online job-search competitors, such as Monster.com, in the past two years.

To maintain profitability, papers nationwide have been laying off employees since the beginning of 2001. About 2,000 employees were cut from daily newspaper staffs in 2001, a reduction of 4 percent. About 300 new employees were added last year, said Richard Edmonds, a researcher for business issues at The Poynter Institute, a St. Petersburg, Fla., school for journalists and journalism teachers.

Revenue from help-wanted and automotive ads at the Journal dropped about $1 million in the past two years as the economy soured and businesses cut spending and stopped hiring. Earlier this year, 11 full-time positions were cut. Other jobs were cut last year when the newspaper opened a $21 million printing plant to replace two aging facilities in Bellevue and Kent. In addition to printing the King County Journal, the 56,000-square-foot plant publishes the Seattle Weekly and Investor's Business Daily.

The company is trying to expand other business areas such commercial printing and recently installed a faster press. The layoffs should restore the newspaper's profit, but Horvitz said he doesn't exclude other cuts.

"Our mission is to do whatever is necessary to become financially successful in this market, and we will continue to adjust," he said.