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Tuesday, June 17, 2008

Throwing a rock at the hornets nest

The Sun News is just one paper in a larger corporation called McClatchy. McClatchy owns such papers as "The Miami Herald," "The Charlotte Observer,""The Kansas City Star," and spread as far as the "Anchorage News." Within this corporation, there are many failing papers. (Actually is country wide for every industry right now) By failing I mean papers that aren't hitting quite enough people or aren't selling as much advertising as needed to run what is quickly becoming the dead art of the newspaper. "The Sun News" however is one of the papers within this larger company that actually does make money. Essentially the paper pays for failing papers to stay in business.

Yesterday McClatchy restructured (Thats a fancy word they came up with for the press release to trick stock holders into thinking everything is OK) their business by cutting 1400 jobs. The job cuts weren't equally felt around the country. It seems that McClatchy did do one thing right and seemed to cut more staff at papers that weren't doing so well or papers that were already small. For instance, "The Sun News" in Myrtle Beach only had to cut back 3.6% of its workforce which roughly translates into about 9-10 jobs. Other papers such as "The Miami Herald" saw a 17% decrease in staff. Some papers weren't affected at all, like the D.C. branch which survived this round of cuts... well uncut. (http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003816952)

We all understand that sometimes businesses have to be cut in order to say some money. Honestly at any place of business there is at least one or ten people that should be fired. These are the types that constantly complain about their job, don't try to be friendly to co-workers, don't pull their weight, and I don't have to continue describing them because I know everyone of you is picturing that person right now. Cutting Sallie's job however makes no sense. I know for a fact (and I don't even work at the paper) that there were about five to ten other people in the newsroom that deserve to be fired and there are probably fifteen people that they could've done without more easily than the ones they cut. In all honesty, Sallie was probably the lowest paid person in the newsroom. What has the company saved by getting rid of her? Piece of mind I'm guessing. Some number cruncher probably saw a person with no seniority in a section of the newsroom that had six people working in it. The bosses see lay off happen, and they are happy without asking questions. The thing is, the copy desk was already stretched thin.

Now, I've alluded to these mysterious CEOs. Who are they? Here's a list with pictures of each of them. http://www.mcclatchy.com/100/story/331.html

Now excuse the language... but these guys all look like whiny, trust fund, assholes. (Miss Dickerson's name says it all.) The only guy in the bunch that looks like I would hang out with (yes judging a book by its cover) is Howard Weaver. I think its a brotherhood all bald men feel, especially when people like me and Howard look awesome with a shaved head.

Now that I've put names and faces on the higher ups lets look at a salary. Gary Pruitt got a nice 4.8% raise last year bringing his yearly salary up to a smooth 1.1 million dollars. This essentially means his raise was only like $52,800. (If I've done my maths right) That's not very much. I think Gary is worth much more than that. According to McClatchy's website in 1999 all the board members received 3.5% to 12% increase in their salaries. This means Gary must have only hit a couple of the many goals set forth by the committee for board members to get raises.

McClatchy has published on its website the salaries of all the board members from 1999. Mr. Pruitt was making a slap in the face $725,000 with a bonus of only $525,000. (No, you read that right, his bonus was around 75% of his already awesome salary) Gary's loyalty to the company is obvious here cause I know I wouldn't stay with a bonus that small. Everyone else on the board at this time were only making $360,000. Assuming that their percentage of pay increased the same as Gary's, most of the officers should be making around $532,800 now. With a conservative estimate, that means the board makes something around $5,000,000 a year with another couple million in bonuses. (Assuming the trend is the same as it was in '99)

So was Gary's meager $52,800 raise last year enough to motivate him to cut jobs, to save money, to get yet another raise. I mean that is the American dream isn't it. More money, more American. If we think about this in terms of the little people that are now jobless in the company, the raise Gary's buddies gave him last year essentially equals two Sallies. The bonus he got was worth somewhere around 10 other employees. Add in the bonuses of all the other board members and you just saved close to 25 (and these are high salary employees, this is probably closer to 50 jobs that were cut) jobs within your company. Now thats not a lot of jobs, but think about this. Some of the papers haven't lost money. Some are actually making money. (cough cough "The Sun News" cough) Why not put your bonuses toward keeping some of the papers going. Maybe put an ad campaign out about advertising with McClatchy papers. Hell, maybe they could even afford to upgrade the ancient software (and hardware for the most part) filling their building here in Myrtle Beach. Oh and those estimates are only taking into account the Senior officers, there's also a 14 person board of directors that I'm sure make a pretty penny as well. (Their pictures are in black and white which means their classier. http://www.mcclatchy.com/100/story/332.html)

To me this seems like the classic example of the rich versus the poor. (As a disclaimer however, I know Sallie and I aren't poor, we're just poorer than the CEOS of McClatchy.) I feel that there are so many other ways they could've saved money before they did mass cuts across the company. The scary thing is the cuts they made had no real reason to them. They were seemingly random cuts and now the entire newsroom is on eggshells wondering who's next. Yes there are to be more cuts in the future... uh sorry... there will be more RECONSTRUCTION in the future. I truly worry about the friends I have made here and their positions' safety. They're going to have to work much harder longer weeks, and in a month they might find out the company is giving them the boot. If McClatchy actually believed their statement that they are defenders of the values of the community, then the board would've taken a wee pay cut to save some money and some jobs and also save the paper. (Yes in an effort to save more money, the paper here has been cut down a bit)

In conclusion I've probably not accomplished anything here with anyone that can change the situation. However, with my number crunching I hope that a couple of you at least got a bad taste in your mouth. The economy is in bad shape right now and lay offs are to be expected, but if the CEOs do nothing else with all of their money, pay someone to figure out that the economy is in a downturn and hiring someone for 5.5 months to pick up her life, significant other, and sick cat to come across the country the day after Christmas is not the best idea.

Where'd I get all my numbers and figures and fancy talk:
To read about Gary's raise last year http://sacramento.bizjournals.com/sacramento/stories/2006/12/11/daily49.html

To read their ever so stagnant MNI Proxy Statement http://sec.edgar-online.com/2000/03/24/16/0001012870-00-001587/Section10.asp

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