Advance Folds 'Ann Arbor News,' Unpaid Furloughs Companywide

by Erik Sass, Mar 23, 2009, 4:14 PM

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Suffering from the same steep decline in revenues that is afflicting the rest of the newspaper industry, Advance Publications said Monday it will cease daily publication of the Ann Arbor News in July and scale back distribution of three other newspapers--The Flint Journal, The Saginaw News and The Bay City Times--from seven to three days a week beginning in June.

Four other small Michigan dailies face cutbacks as editorial and production staff are consolidated to one office in Grand Rapids. Another newspaper, the Jersey Journal of Jersey City, NJ, will be closed next month if no buyer is found. Advance will also require employees to take a 10-day unpaid furlough at most of its other newspapers, making it the latest major publisher to resort to this cost-cutting tactic.

The company, owned by the Newhouse family (which also owns Conde Nast) is not withdrawing from Ann Arbor altogether. The Web site of the Ann Arbor News, AnnArbor.com, is being reinvented as a stand-alone company that will produce a print newspaper twice a week, on Thursday and Sunday. AnnArbor.com is expected to hire some employees from the defunct newspaper, but the Web operation will be far smaller than the print business.

The unpaid 10-day furloughs will affect most of Advance's newspapers, including big regional dailies like the Cleveland Plain Dealer, Star-Ledger, of Newark, NJ, and the Times-Picayune of New Orleans. Employees at the Plain Dealer and the Portland Oregonian also face salary cuts. The company also will freeze pensions, although it said it would increase matching contributions to 401(k)s.

These are the latest in a spate of closings, reductions in frequency and unpaid furloughs implemented by newspaper publishers. On the first front, The Rocky Mountain News of Colorado closed in late February, and the Seattle Post-Intelligencer closed its print edition earlier this month, going to Web-only publication. Among large newspapers, The San Francisco Chronicle is also threatened with closure by Hearst if it can't find a buyer. And the Journal Register Co. has closed literally dozens of small weekly newspapers across the Midwest and Northeast.

In the area of frequency reductions, The East Valley Tribune in Arizona said in October it would cut back its publication schedule from seven days a week to four. In December, the Detroit Free Press and Detroit News--published under a joint operating agreement by Gannett and MediaNews--said they were cutting back home delivery to three days and two days a week, respectively. In March, Philadelphia Media Holdings said the Philadelphia Daily News will be published under the corporate umbrella of its sister paper Philadelphia Inquirer to save money.

Finally, December The Seattle Times asked approximately 500 of its non-unionized employees to take a week's unpaid leave. In February, Media General said all employees have to take 10 days of unpaid leave in 2009, including four by the end of March, and The Financial Times of London said it would ask employees to take three-day weekends without pay on the extra day.

On Monday, the Gannett Co. also announced another round of unpaid furloughs in the second quarter of 2009. Most Gannett employees will be asked to take a week of unpaid leave, in anticipation of a continued downward spiral in the publisher's revenues. Employees must take the furloughs by the end of June. This will be the second quarter where Gannett has put employees on unpaid furloughs. In January, Gannett said it will require thousands of employees to take a week off without pay.

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