Tech changes lead to jump in media job cuts
EmptyNEW YORK -- Media industry job cuts soared to 17,809 last year, up 88% from 2005, according to a study released Thursday from outplacement consultancy Challenger, Gray & Christmas, which cites technological changes that put pressure on traditional print media as key drivers.
The firm said that last year saw the highest number of media sector layoffs since the 43,420 job reductions announced in 2001, when the Internet bubble burst.
"With over 2,000 job cuts announced by media companies in the first half of January, it appears that the downsizing trend will continue in the foreseeable future," the report said. Time Warner's Time Inc. unit and the New York Times Co., among others, have announced job reductions in 2007.
Compared with other industries, media folks looked good last year in absolute terms. Auto firms announced 158,766 job cuts in 2006, and the financial industry saw 50,327 layoffs, according to Challenger.
However, in terms of year-over-year increases, the media sector cuts came in right behind the electronic commerce market, which saw a 781% jump in layoffs from 748 in 2005 to 6,591 in 2006.
Media companies "will continue to make adjustments as their focus shifts from print to electronic," Challenger CEO John Challenger said. "Until they can figure out a way to make as much money from their online services as they are losing from the print side, it is going to be an uphill battle."
He also pointed out that newspapers are not only competing with other traditional news organizations but also with "an exploding number of bloggers, industry experts, gossip sites, etc."
Challenger predicted that "the decline in newspaper and newsweekly subscriptions will continue as more and more people purchase computers and gain access to the Internet. We will continue to see job cuts, particularly in the production and distribution areas of the print operations."