As the Phoenix’s media writer, I spend a lot of time writing about the struggles of other news outlets--in particular, the woes of the Boston Globe, whose very existence is currently in question. And I’m periodically asked by other journalists: “So, how are things at the Phoenix?” My response tends to be vague, and to reflect my (intentional) lack of knowledge about my employer’s finances: Like every other print publication, I think we’re hurting a bit--but so far we haven’t had any layoffs, knock on wood. Or words to that effect.
It’s time to update that answer. A few minutes ago, Stephen Mindich, the Phoenix Media/Communication Group’s publisher/CEO/chairman, announced an array of cuts at the Phoenix and elsewhere in the company in an email to employees. Our 401K matches, which just began a few months ago, are being suspended. Six people are being laid off, two in editorial. (I’d include their names, but don’t want their family and friends to learn the news from me.) And every employee is going to have his/her salary cut, with the highest-paid giving up considerably more than the lowest. (The range is 10 percent to 2 percent, with some top brass giving up a bigger amount; see the memo below.)
Obviously, I’m worried about how the loss of income will affect me and my family. But I’m also relieved--and grateful--to still have a job, and a very good one, at a moment when so many journalists are losing theirs. And I take genuine pride in the fact that the PMC/G’s best-paid employees are sacrificing more of their salaries, proportionally speaking, than their more modestly compensated colleagues. That’s the kind of company you want to work for.
Finally--strange as this may sound--I think experiencing this unpleasantness firsthand might make my do my job a bit differently. Until now, I’ve been insulated from the unpleasant realities I write about pretty much every day. Now, unfortunately, I’ll have a different perspective--more immediate, more visceral--when I write about layoffs, or salary cuts, or the bigger economic developments that make these things necessary. In all honestly, that’s empathy I’d rather not have. But if it makes me proceed a bit more cautiously, or leavens my harsher judgments ever so slightly, that might won’t be a bad thing.
Here’s Mindich’s memo:
This is an extremely difficult letter for me to write to all of you. But I must tell you that the economic climate in which we’re operating has finally caught up with us. Our ability to outmaneuver adversity has been strained as it’s never been strained before and in order to run our company effectively and guarantee our collective future, we must take action today.
Despite the hard work, commitment and imagination of so many, we are now going to have to make sacrifices. Consequently we have no choice but to impose a number of cost and wage - saving measures including across-the-board reductions in pay for all and the suspension of our 401K match for ’09. No one is exempt, not me, Brad, Rick or anyone else. I’m spelling this out to reassure everyone that the immense sacrifice from all of you is being shared by everyone.
As everyone knows we, of course, are not alone in taking these steps. Companies small and large – in virtually every business endeavor, and not just the media, have had to reduce their costs in order to stay the course and remain viable.
A significant difference between us and so many other media companies, and which is indicative of our potentially healthy future, is that we are not taking these steps because we have an audience issue or a circulation issue problem. What we do have, however, is an overall cost structure issue brought on and exacerbated by our national recession - and that is what we are rectifying through these actions.
Unlike many companies, however, who simply put into place the same percentage reduction for all employees, our salary reductions will be graduated -- divided into eleven diminishing steps ranging from 50% to 2%. In other words, top management will take the biggest cuts. Salary decreases will be scaled according to categories with those earning the least receiving the smallest cuts.
These will take effect in the next pay period. Your supervisor will soon relate the specific details to you personally.
Additionally, we unfortunately have had to do a very limited number of layoffs and these were made only after all other options to reduce costs were taken. There is also the likelihood that in a few months we could implement a temporary fixed reduction in your regular workweek due to today’s economic conditions. If this is to take place, you will be notified in advance by your managers.
Over our 42 year history we have had to do layoffs two other times and it is truly one of the most painful experiences I can recall. That said, over the years we have been fortunate to hire many people back and my hope is that this will be the case this time as well.
It is important to repeat that we are instituting these wage reductions and limited layoffs now in order to preserve as many jobs as possible. The goal here is to stabilize the costs of the company while minimizing the number of lost jobs. And we fervently believe through these steps we will accomplish our goal.
Like so many other companies in and out of the media business, we’re in a tough spot. But I have every faith in the future. I have no doubt that we have the collective ability to out think our competition and out last these challenging circumstances. Companies that succeed today will be in an extraordinary position tomorrow; we intend and expect to be one of those companies.
I will also note that we will be looking monthly at the various changes we have made in the compensation program and other reductions, and if we can reverse anything we will at the earliest possible moment.
Finally, I want everyone to know, and everyone who knows me, knows this, none of what we are doing was decided upon lightly. I have tapped every personal and corporate resource possible before taking these steps – and took them only after being convinced that they are all necessary steps which will ensure our future success.
Of course, if any of you would like to speak with me or Brad personally, please reach out to us.
Stephen M. Mindich