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Dow wsj layoffs Original Source Link: (May no longer be active)
http://story.news.yahoo.com/news?tmpl=story2&u=/dowjones/20021105/bs_dowjones/200211041917000730http://story.news.yahoo.com/news?tmpl=story2&u=/dowjones/20021105/bs_dowjones/200211041917000730
Dow Jones Warns of 230 Job Reductions by Mid-November
Mon Nov 4, 7:17 PM ET
By Brian Steinberg
NEW YORK -- Dow Jones & Co. , parent of this newswire and publisher of The Wall Street Journal, said it had begun Monday eliminating what could be as many as 230 jobs in reaction to difficult business conditions that have troubled the company for nearly two years.
In addition, Dow Jones said it would institute salary freezes for many managers and senior executives.
In a memo to employees, Peter R. Kann, the company's chairman and chief executive, cited "the harsh economic climate in which we're operating" as well as "depressed" global markets for financial services, technology and other business-to-business providers as reasons for the job cuts and other cost-saving measures.
As a result, about 230 positions will be eliminated across the company, said Karen Miller Pensiero, a Dow Jones spokeswoman. She declined to specify the parts of the company where the job cuts might take place, noting that it would take about a week to notify affected employees.
"Until everyone is notified, I think it would be inappropriate to discuss specifics," she said. As of the end of September, Dow Jones employed 7,011 workers, she said.
Tim Martell, an organizer at the Independent Association of Publishers' Employees, which represents about 2,000 workers at Dow Jones and Factiva, a joint venture with Reuters Group PLC , said the union had no immediate comment.
Ms. Pensiero later said that "layoffs are occuring everywhere, including The Wall Street Journal." She declined to elaborate on what parts of the newspaper's staff, editorial, technology or business, might be affected.
After thriving on ramped-up marketing spending behind the dot-com boom of the late 1990s and 2000, Dow Jones has reeled in recent months.
The company has had to find ways of lowering costs as its flagship publication, The Wall Street Journal, has experienced ad-revenue declines. For the third quarter, Dow Jones' print-publishing revenue, which accounts for the majority of the company's business, dropped 10.4% to $205.3 million as the business recorded an operating loss of $18 million compared with a loss, before special items, of $400,000 last year.
Those managers in the company's bonus program will receive bonuses that are " sharply curtailed" for 2002, if they get any, said Mr. Kann. Target bonuses for 2003 will also be reduced.
Mr. Kann said he won't receive a bonus for 2002.
In addition to the job cuts, Mr. Kann said Dow Jones would start a salary freeze for all nonunion and nontandem employees starting in 2003. For most of Dow Jones' senior executives, salaries will be frozen for a second year in a row. Salary raises for union and tandem employees, if any, will be determined during contract negotiations in 2003, Mr. Kann said, or by contracts in force for that year.
"Our view," Mr. Kann said, "is that these negotiations should result in a similar salary freeze."
While noting that the continued staff reductions have been "the most difficult cost-control measures" -- as of the third quarter, head count at Dow Jones has fallen 12% since March 2001, not including some divested community newspapers -- Mr. Kann said such measures were necessary. Without past cost controls, he said, "we would have been unprofitable in both 2001 and 2002."
While the company certainly hopes for better times, it was unable to offer any guarantee that other cost cuts, including more staff reductions, might be necessary in the future. "We certainly hope that there won't be any more layoffs," Ms. Pensiero said. "If we are successful in making our numbers moving forward, then there will be no need for further layoffs."
Dow Jones publishes The Wall Street Journal and its international and online editions, the Far Eastern Economic Review, Barron's and SmartMoney magazines and other periodicals, Dow Jones Indexes and the Ottaway group of community newspapers. Dow Jones is also co-owner with Reuters Group of Factiva and with NBC of the CNBC television operations in Asia and Europe. Dow Jones also provides news content to CNBC and to radio stations in the U.S.
-Brian Steinberg, Dow Jones Newswires; 201-938-5218, brian.steinberg@ dowjones.com
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