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News Corp’s HarperCollins book unit said it is planning to cut 5 percent of its workforce in North America this fiscal year, which ends on June 30.
The first of those job reductions took place on Monday. HarperCollins has approximately 4,000 employees worldwide, with its largest operation being in North America.
“As noted last October, HarperCollins continues to experience unprecedented supply chain and inflationary pressures resulting from the pandemic, including increased paper, manufacturing, labor and distribution costs,” a representative of the publisher said. “Coupled with declining sales over the last few quarters, these issues have resulted in us having to make difficult decisions to realign the needs and resources of the business. In addition to implementing a variety of cost-saving measures, we will be reducing our workforce across North America by 5 percent before the end of the fiscal year.”
Sales momentum seen during the COVID pandemic has “slowed significantly as of late,” HarperCollins CEO Brian Murray wrote in a memo to staff, per Publishers Weekly. “We must pause to recognize the depth of the core issues we currently face.”
The cost-cutting plans come after Rupert Murdoch sent a letter to the boards of News Corp and Fox Corp. withdrawing his proposal for a merger to reunite his media empire. “In withdrawing the proposal, Mr. Murdoch indicated that he and Lachlan K. Murdoch have determined that a combination is not optimal for shareholders of News Corp and Fox at this time,” a News Corp board statement said last week. Through a family trust, Murdoch has effective control over the companies, but a merger would require approval from a majority of non-Murdoch affiliated shareholders.
The news of the HarperCollins layoffs also follows the book publisher’s agreement to work with a mediator to end a strike by around 240 union members.
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