Things are not looking good for liberal news outlet The Guardian (U.S.), as executives announced a 30 percent reduction in staff Thursday.
Guardian Media Group CEO David Pemsel called the changes a “course correction” during a company meeting.
The culling was due in most part to low advertising sales and poor revenue projections, Eamonn Store, the group’s CEO, told staff at the meeting. The sales projections are simply “not enough to maintain our current cost base,” she added.
The company, which has been getting hosed financially for the past couple years, must make up for a revenue shortfall of $4.4 million within the end of the year.
The UK-based media group ran headlong into financial turmoil this year, suffering pre-tax losses of more than $90 million compared to a mere $19 million loss last year.
The beleaguered left-wing news outlet lost nearly $227 million last year when write-downs are included in the math. Worse still, high-profile journalists are leaving The Guardian because they are skeptical about the newspaper’s membership program.
“It is inevitable that such seismic shifts in the business model are adversely impacting our revenues despite the Guardian’s strong U.S. brand recognition,” Pemsel and Guardian Editor-in-Chief Kath Viner wrote in an email to staff. Management also claims that many of the problems can be chalked up to volatility in the U.S. and U.K. media industries.
The company will offer buyouts to unionized editorial staff first and will eventually begin a chorus of layoffs if necessary. The reductions will amount to a decrease of about 50 jobs across the 150-person group, according to a source briefed on the measures.
Pemsel told staff that the company is committed to Guardian U.S. for the long-term despite the downsizing and the possible layoffs. “We are absolutely committed to making this work,” he said.
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