The Star cuts pay, benefits to trim costs

Feb 19, 2009 (Ventura County Star - McClatchy-Tribune Information Services via COMTEX) -- SSP | Quote | Chart | News | PowerRating -- The Star announced Wednesday it was cutting workers' pay and retirement benefits as part of a companywide effort to control costs during bleak times.

Employees learned that The Star's parent company, E.W. Scripps, was making "fairly serious cost-reduction measures" in an e-mail from George H. Cogswell III, president and publisher of The Star.

Joe Howry, editor and vice president of The Star, followed that up with an all-hands meeting at 3 p.m. in the newsroom, where employees were able to ask questions.

The changes affect about 275 full-time employees at the Camarillo-based newspaper. The measures include pay cuts of 5 percent for exempt employees and 3 percent for non-exempt workers, a wage freeze, suspension of the company's matching contribution to employees' 401(k) plans and freezing and discontinuing the pension plan.

Cogswell said the company might be able to revisit some of the cost reductions if the economy improves.

"We hope these changes are an effective first step, but any additional changes will depend on changing business conditions," he wrote.

Howry said the company is in a good position to stay afloat.

"We are on good financial ground and we are putting ourselves in a position to stay that way," he said. "I think that there is tons of room for hope."

Star employees were shaken but realistic about the announcement.

"I feel thankful that I have a job and, frankly, I wasn't surprised given the economic realities that our industry and nation faces," said Kevin Clerici, a staff writer who has been with the newspaper for five years. "Still, it was a blow. You don't get an e-mail like that and not have it affect you."

Clerici believes the pay reduction is a better alternative to further staff cuts.

The Star has gone through a number of cost-cutting steps in the past few years as the economy has soured and circulation has declined, to about 83,000 daily and 94,000 Sunday, as of October. News sections have been consolidated, the advertising graphics department was outsourced, seven people were laid off in February 2008, and buyouts were accepted by nine senior employees in mid-2007.

Last November, the company announced it was laying off 44 people from the newsroom, advertising, production and other departments. Since then, the newsroom has increased its reliance on freelance writers and photographers.

"I don't think these changes announced today will have a significant impact on our coverage compared to the huge challenges that we were already facing before this week," said Senior Editor Mike Comeaux.

Just like newspapers everywhere, The Star's editorial department has been grappling for several years with industry downsizing, the challenge of adapting to online media and declining revenue, he said.

"The revenue concerns have affected our staffing and our ability to do the kind of coverage that we want to do," Comeaux said.

Staff Writer Lisa McKinnon said the biggest difference between the newsroom now and when she joined the newspaper in 1992 is that a larger geographic area is being covered by fewer people.

"That's the biggest difference," she said. "It gets more and more complex, and that's happening in every industry, not just ours."

Joe Mathews, a veteran reporter who accepted a buyout from the Los Angeles Times in March 2008, wrote an article on the newspaper industry in the latest edition of The New Republic magazine.

"Where dozens of reporters once worked," he wrote, "only small skeleton crews remain. There are fewer checks. Fewer meetings are witnessed. Fewer records are reviewed."

What stories, he asks, are we missing?

Asked about the E.W. Scripps' cuts, Mathews said he actually likes the decision to keep people and find other ways to cut costs.

"Somebody there realizes that each reporter is really difficult to replace," he said. "You have knowledge and contacts that are valuable to the company.

"I wish the L.A. Times had done that and not just purely gotten rid of so many reporters. The L.A. Times would be a better newspaper today if it had approached the cuts like Scripps."

The changes came a day before E.W. Scripps is scheduled to release its earnings report.

In a companywide e-mail, E.W. Scripps President and Chief Executive Officer Rich Boehne wrote: "Our economy is busted at the moment and recovery won't come without pain. ... There's reason to trust that our current sacrifices can result in future dividends for all us who help create the next successful chapter of the news industry and The E.W. Scripps Company."

Star employees received the Boehne e-mail, which provided a company overview, before further details were provided in the e-mail from Cogswell.

During trading Wednesday, E.W. Scripps stock hit a new 52-week low of $1.49.

The company operates daily and community newspapers in 15 markets in the United States.

To see more of the Ventura County Star, or to subscribe to the newspaper, go to http://www.venturacountystar.com. Copyright (c) 2009, Ventura County Star, Calif. Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

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