Media firms keep pink slips coming
TW Cable, Bloomberg join bleak paradeNEW YORK -- Another day, another 1,350 media jobs lost.
On Wednesday, Time Warner Cable said it will eliminate 1,250 positions in the coming weeks amid slumping subscriber momentum. Hours later, financial news provider Bloomberg said it will cut 100 TV and radio jobs in its first-ever layoffs.
Those were the latest in a series of recent cutbacks that have erased any doubt that media and entertainment firms are as vulnerable as any company in the U.S. The first weeks of 2009 have also brought pink slips at Time Warner's Warner Bros. and AOL units, Clear Channel Communications and others. Disney CEO Robert Iger said Tuesday that the entertainment powerhouse is also looking at "very significant" cost cuts, including layoffs.
Adding to the grim picture is word that overall job cuts in the U.S. soared to a seven-year high in January, according to a report from global outplacement consultancy Challenger, Gray & Christmas.
"We aren't immune," Time Warner Cable CEO Glenn Britt said. The cuts amount to less than 3% of the cable giant's work force, but it also plans to leave an unspecified number of open positions unfilled throughout the year. While Britt said cable in this downturn should hold up better than many other sectors, he admitted that the recession has significantly dragged down subscriber momentum.
Announced media layoffs for the first month of the year came in at 4,446, up from the already-elevated 4,283 reported for the same month last year, according to Challenger. In 2007, January media layoffs amounted to 2,155; in 2006, they were 1,134.
"This is the longest and deepest recession in decades," said Hal Vogel, president of Vogel Capital Management. "Companies overstaffed by some (not all) arrogant know-it-all types and also the legacy business models need to be significantly revised now that they've been technologically disrupted and/or rendered obsolete."
Last year, corporate America laid off the most employees since 2003, while the media sector eliminated folks at the highest rate since 2001. Media cuts for 2008 amounted to 28,083, the highest since 43,420 pink slips in 2001, when the Internet bubble burst.
January often ranks as the year's heaviest for layoffs as companies start the year by further right-sizing their operations.
"Unfortunately, there is no light at the end of the tunnel," said John Challenger, CEO of Challenger. "Even if the stimulus package is successful, it could take months to make a noticeable impact on the employment picture."
Nationally, Challenger said record downsizing in the retail sector helped push the number of planned job cuts announced in January to 241,749, the worst month since January 2002, when job cuts reached a record 248,475. Those also marked a 45% increase from December.