- The local-newspaper giant GateHouse Media is laying off journalists across the US, multiple sources told Business Insider.
- Over 115 layoffs have been documented at 45 publications.
- Mike Reed, the CEO of GateHouse’s parent company New Media Investment Group, downplayed the cuts in an interview with Business Insider, saying they were “not material” when considering the scope of the company.
- Visit Business Insider’s homepage for more stories.
The local-newspaper giant GateHouse Media is making cuts across US newsrooms for a second time in 2019, following at least 60 layoffs in January and February and first-quarter losses.
Over 115 layoffs have been documented at 45 local newsrooms in states including Florida, Pennsylvania, Texas, Ohio, California, and Massachusetts, with potentially more to come.
A GateHouse employee who wished to keep their name private said layoffs could number near 200.
When Business Insider talked to Mike Reed, CEO of GateHouse’s parent company New Media Investment Group, he downplayed the cuts, calling them “immaterial,” without providing a specific number of cuts but denying the 200 number, calling it “a lie.”
“We have 11,000 employees, a lot to me is 2,000,” he said.
Later, he told Poynter that the restructuring would affect “a couple of hundred” people, saying that most employees would be asked to take different roles but would not necessarily be out of a job. He told Poynter that the number of actual layoffs would only amount to “more like 10.”
“We have layoffs and new hires that you would expect with a company of 11,000 employees,” he said. “We’re trying to reallocate expenses and resources from non-sales and non-content producing places and put those resources and expenses into producing more content and more sales, which would put us in a better position for long term success.”
Reed said the company plans to hire 30 journalists across the US in the next 30 days.
But posts on social media and local journalists are telling a different story. Reporter Andrew Pantazi of the Florida Times-Union, a GateHouse publication, is the unit chair of the paper’s guild and is tracking the layoffs in a spreadsheet. He says through Twitter DMs, emails, and texts, that he’s confirmed at least 115 layoffs.
“I want to know what impact these cuts are specifically having and who is being cut,” Pantazi said. “It appears the company is particularly targeting editors, and it shows how short-sighted its plan is that it doesn’t see the importance of local editors plugged into the community.”
Small cuts at already small publications have left some devastated. Bill Shaner of Worcester Magazine tweeted Thursday afternoon that after two editors at the publication were laid off, he was the only one left.
“I am the only editorial staffer left, with a full paper to put out next week. Pray for me,” he wrote.
The cuts appeared to hit roles across the company, including editors, reporters, and even part-time staff, according to testimonials on social media, communications with journalists, and documents seen by Business Insider.
Also on Thursday, New Media Investment Group announced that it would extend its $US100 million stock buyback program for another year.
GateHouse says it owns 156 daily newspapers, 364 community publications, and more than 555 local websites in 39 states.
GateHouse has a reputation for its rapid acquisition of local newspapers, which in turn leads to deep cuts.
Tom Sofield of the local Pennsylvania publication LevittownNow.com wrote that the staff was cut by 70% at the Bucks County Courier Times after GateHouse acquired it as part of a $US17.5 million deal in 2017. In 2018, the company acquired titles including Florida’s Palm Beach Post and Palm Beach Daily News.
Since filing for bankruptcy in 2013, GateHouse has made numerous multimillion-dollar acquisitions as part of a strategy to digitize local papers. In September, GateHouse acquired the Oklahoman, where it laid off 37 staffers, according to Poynter. In April 2018, GateHouse acquired Ohio’s Akron Beacon Journal for $US16 million.
The layoffs come amid a dwindling number of local papers in the digital economy and widespread media layoffs since the beginning of this year. More than 2,800 media jobs have been lost so far in 2019, according to a Business Insider calculation.
Update May 24: After the publishing of this article, Mike Reed sent an internal memo to GateHouse employees calling this article “misleading” and emphasising “nothing is more important to our future than preserving high quality local journalism.” You can read his entire statement below.
NewMedia CEO Mike Reed, who said yesterday's layoffs just affected 10 people when in fact I have counted more than 110, says @benjamingoggin's story was "misleading." Now Mike Reed says layoffs allow us to do "more, not less, quality local journalism." pic.twitter.com/zMSar5roee
— Andrew Pantazi ???? (@apantazi) May 24, 2019
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