A lot fewer people are ‘standing’ at N&O, McClatchy today as newspapers struggle to change

RESEARCH TRIANGLE PARK, N.C. – “I’m still standing,” an N&O reporter told me by phone after the bloodbath unleashed in Raleigh and across the McClatchy newspaper chain on Monday.

A lot of other people – 70 in Raleigh, north of 120 in Charlotte, 1,400 across McClatchy – weren’t.

As workers at McClatchy properties in Charlotte, the Triangle, Raleigh, Cary and Smithfield arrived at their respective offices Monday, a lot of them found out they no longer had a job. By the end of the day, they discovered many more changes would be taking place other than fewer people at desks and manning presses.

Publisher Orage Quarles spelled out the many changes affecting The News & Observer and its affiliated properties in the Triangle at a meeting Monday afternoon and then refused to discuss the changes with WRAL.com.

"You will have to read it in tomorrow's paper," Quarles said.

However, The Charlotte Observer reported: "The papers are combining capital bureaus, sports and research departments in an effort to eliminate overlapping work. The newsrooms’ feature departments also will work to develop jointly produced sections."

Editor John Drescher told the editorial staff in a meeting late Monday that the changes indeed did extend far beyond layoffs. Combining editions. Moving up deadlines. Offering thinner papers. Jonathan Cox, The N&O reporter assigned to write the story, described what Drescher and Quarles laid out as “sweeping changes.”

Bottom line - there will soon be a lot less to differentiate The N&O from its sister paper The Observer – once heated rivals until McClatchy bought the Knight-Ridder chain (including the Observer) in 2006.

What a tumultuous day for employees at both papers and the McClatchy chain.

With little warning to employees other than persistent rumors that cutbacks were coming, McClatchy told Wall Street before the markets opened that the nation’s third largest newspaper chain would cut 10 percent of its workforce. The company also announced its revenues plunged 15 percent in May from a year earlier.

At The N&O, people scrambled for information until Quarles sent out an e-mail saying some 70 positions would be cut. As one staffer told me, people who hadn’t been called in for a discussion with Human Resources assumed they had escaped the firings.

The staffer called the situation “nerve-wracking.”

Given the company’s worsening financial performance, layoffs should have come as no surprise. However, the Associated Press in its coverage of the story noted that the McClatchy move – about 1,400 jobs across the nation’s third largest newspaper chain – was an “unusually broad and deep effort to contain costs”

More than people at The N&O could be affected. McClatchy also operates its McClatchy Interactive division in the Triangle. But Chris Hendricks, vice president for interactive media, declined an interview request from WRAL.com.

The Charlotte Observer is the state’s largest newspaper and maintains a bureau of four people in Raleigh. Now The N&O and the Observer are combining political staffs as well as sports and features, according to the N&O’s own account.

Wow. Who would have ever expected that?

In the Triangle, other McClatchy properties include The Smithfield Herald and the Cary News. The N&O also has bureaus in Durham and Chapel Hill. They too will be affected.

Other cutbacks in expenses also will be made, McClatchy said. Each newspaper is responsible for making cuts in its operations and notifying the people affected.

In a statement, McClatchy Chief Executive Officer Gary Pruitt said the layoffs and other cost reductions were “essential.”

"We have been transitioning steadily and successfully from a traditional newspaper company to an integrated multimedia company for some time," said McClatchy CEO Gary Pruitt. "The effects of the current national economic downturn -- particularly in real estate, auto and employment advertising -- make it essential that we move faster now to realign our workforce and make our operations more efficient. I'm sorry this requires the painful announcement we are making today, but we're taking this action to help ensure a healthy future for our company."

McClatchy has already cut its workforce by more than 13 percent since it acquired the Knight-Ridder newspaper chain two years ago. The cuts announced Monday come on top of a 10.5 percent reduction in expenses for the first quarter and a reduction of 7.5 percent in full-time employee headcount over the last 12 months.

So how did the news affect Wall Street? As hundreds of people headed for unemployment, McClatchy (NYSE: MNI) shares traded down 13 cents for the day.