Boston Globe Staffers - Self-Inflicted Cuts Boost Parent Company Profits
While Boston Globe staffers, believing the hyped up dire situation presented to them, last July, accepted an almost 10% pay cut (combined salaries and benefits) during tough contract negotiations with management. Amidst a down economy, these staffers felt they had no choice when presented with a deal that was repeatedly rejected in previous months. (Boston Globe's biggest union accepts wage and benefits cuts, 7/21/09).
Meanwhile, even while total revenue was down, the $20,000,000 that staffers willingly gave back to the paper, boosted the $90,900,000 in net income that the parent company of the Globe - The New York Times Company - showed on it's books (Times Company Reports Profit for Quarter and Year, 2/10/10).
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Thus, the company was able to further pay down it's debt load, and further benefited from an up-turn in the stock market to aid their pension obligations. As the company ramps up plans to charge for some of it's online content, a 10.3% increase in the fourth quarter for advertising revenues meant $102,000,000 in income for the quarter. This helped reduce the net loss of 4.1% for the entire year, partially attributable to the recession last year. Thus, it would be reasonable to project that online advertising revenues will grow further in the coming quarters, without a recession to bog down growth.
It is unfortunate that staffers were hoodwinked into accepting a substantial cut in salaries and benefits, because the end beneficiary is the corporate profit centers, at the expense of the staffers whose content makes the paper great.
Remember, it's not personal, it's just business. Next time, don't give in, they are profiting out of your pocket-books.
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4 comments:
The UAW and USW workers at GM and Chrysler and International Harvester probably thought they were invincible and irreplaceable too. They acted that way. Hasn't worked too well for them though. Everything except going into the street with the camera can be offshored, or automated. 90% is better than 100% of no job at all.
What I want to know is did the top executives take a 10% cut, too? Photographers need to remember that the top management of any company could not exist without someone to produce the product. It is not all about money.
I firmly believe all management should take pay cuts publicly before any idea is proposed of cutting staff pay anywhere, anytime, under any circumstances!
Big fan here, and follower via RSS feed that I read daily. Alas, your limited analysis is a tad short-sighted. First, in most cases (every case I have heard and I am in the industry at the executive level), executives at struggling papers all took pay cuts, lost 100% of their bonuses, lost support staff, and more. Second, and more importantly, I don't think you realize how close these papers were (some still are) to completely going out of business (ala Rocky Mountain News) thus leaving thousands of people (including journalists, photogs, and others) scrambling for work in a devastated market that won't be hiring. If they don't pay down debt and raise their stock price, the bond-holders call the note and the game is over. Just remember what you have heard a thousand times -- "please put on your own oxygen mask first, then assist the person next to you" -- if you pass out, then you won't be there to help your child. Those who have momentarily saved the newspaper industry by tightening their belts are to be applauded (I am in this category), though it remains to be seen whether we did enough, soon enough to save the industry we love.
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