Reach to cut 550 jobs
7 July 2020
Reach, owner of the Mirror and Express and the largest local newspapers group, has announced job cuts of 550.
The company which owns titles and websites including the Manchester Evening News, Wales Online, OK1 magazine, the Bristol Post, Nottinghamshire Live and Leicestershire Live, said the is planned changes to the group would make savings £35 million.
The job cuts represent 12 per cent of the workforce and the company said it intended to introduce a more centralised structure. The total number of roles the company anticipates will be cut is 580, but it has told the NUJ that it expects a number of employees will be successfully redeployed.
Jim Mullen, Reach chief executive officer, said: “Structural change in the media sector has accelerated during the pandemic and this has resulted in increased adoption of our digital products. However, due to reduced advertising demand, we have not seen commensurate increases in digital revenue.”
The company statement said: “Editorial will move to a more centralised structure bringing together national and regional teams across print and digital to significantly increase efficiency and remove duplication while maintaining the strong editorial identity of our news brands. In local commercial as well as in finance, Reach will move to fewer locations and a simpler management structure, with costs geared to current market conditions.”
It added: “In June, we have continued to see modest but encouraging improvements in circulation and national digital revenue as the government's lockdown restrictions have eased. Group revenue declined by 23.9 per cent in June compared with 30.5 per cent in April. In June digital saw a decline of 4.9 per cent, compared to the 22.5 per cent fall seen in April when the impact of COVID-19 was at its worst. Print revenue in June was down 26.7 per cent year on year compared with the 31.8 cent decline seen in April. Reach continues to maintain a strong balance sheet with access to sufficient liquidity.”
The 550 job cuts to the group follows hard on the heels of the BBC announcement of 450 jobs to go in England, including 139 jobs in local radio and 29 jobs in the current affairs strand Inside Out, which has gone from 11 regional shows to production in six regional hubs in Newcastle, Yorkshire Norwich, Birmingham, London and Bristol.
Reach furloughed almost 1,000 employees while paying Jim Mullen and Simon Fuller, the chief financial officer, almost £300,000 in bonuses for 2019 in March.
The company said the pay cuts brought in because of Covid-19 would be reinstated. There will be a 45-day consultation on the job losses.
Michelle Stanistreet, NUJ general secretary, said:
“Today’s announcement is a shock and body-blow for our members in Reach who have, in the words of the chief executive today, shown ‘heroic’ efforts to sustain the company through the massive problems arising from a pandemic lockdown over the last three months.
“It will be poor reward for hard-working journalists who have shown great flexibility and adaptability to uproot from their offices to switch to working from home, with all the stress and difficulties that have arisen, to then find there is no job for them in a redundancy process that they have now been pitched in to.
“Across the group, more than 2,000 people will now be officially placed at risk of losing their livelihood and that will be particularly tough for those who have spent weeks, if not months, on furlough under the government’s optimistically titled Job Retention Scheme.
“As a union, we recognise that the Covid-19 crisis has badly damaged the economy and that companies such as Reach are not immune to the consequences of this. Equally, we do not know when trading conditions will return to normal but what the NUJ will be anxious to talk to the company about is how the process to rebalance costs to revenue is done in as fair and decent way as possible. That means seeking volunteers to go as widely as possible and not having some staff feeling they are second class employees to be made redundant with significantly inferior terms to other colleagues in the group. And it means allowing proper time for consultation to take place.
“With the company looking to save £35 million by making these cuts and changes, we remain to be convinced that the loss of hundreds of talented journalists will help the stated mission to deliver quality news and content. We therefore will be seeking to retain as many editorial jobs as possible as the company embarks on its new strategy of centralising national and regional editorial teams. We will be pressing for answers about just how this proposed major structural change can work in practice, for fair treatment for all staff, including casuals and for proper equality impact and risk assessments to be carried out.
“It is welcome that the painful pay cut imposed on staff in April has now been restored.”