Trouble is mounting for the journalism industry as economic uncertainty has prompted a layoff bloodbath across multiple major media outlets.
Within the past week, CNN and Gannett laid off hundreds of employees across their news operations, while BuzzFeed slashed 12% of its workforce and the Washington Post let go of 10 staffers from its print Sunday magazine. The latest cuts followed Morning Brew laying off 14% of its staff and Vice Media trimming 2% of its digital news and publishing staff last month. In addition, the tech news website Protocol shut down, eliminating 60 jobs, while video news startup The Recount also plans to suspend operations.
The media industry’s layoffs are “symptomatic of a long decline in editorial staffing,” Keith Plocek, an assistant professor at University of Southern California’s Annenberg School for Communications and Journalism, told TheWrap.
But the ripple effect is likely to hurt one group in particular more than others: local communities. That’s particularly true for companies like Gannett, which owns USA Today as well as 100 daily papers and nearly 1,000 weeklies in 44 states. (The company is axing 6% of its 3,440-person news division.)
“Fewer reporters means fewer stories, especially stories that take time to put together. And those are often the most important stories, the ones that speak truth to power, that uncover governmental and corporate malfeasance,” Plocek warned. “This is especially distressing at the local level. There are still lots of reporters covering, say, the [U.S.] Senate. But what about the city council in a rural area? Who is keeping track of those politicians? Who is representing the interests of the people who live there? Who is telling their stories?”
BuzzFeed Lays Off 12% of Workforce
One CNN insider told TheWrap that CEO Chris Licht’s self-described “gut punch” to the network is emblematic of the cost-cutting priorities of Warner Bros. Discovery, which reported $48.6 billion in long-term debt as of its third quarter ending Sept. 30. During the quarter, the company’s ad revenue decreased 11% year-over-year to $9.82 billion, primarily driven by audience declines for general entertainment and news programming. In a memo in October, Licht warned that cuts would be made due to “widespread concern over the global economic outlook.”
“The CNN layoffs definitely seem to be connected to the higher-ups anticipating lower revenues,” Plocek said. “Cable news in general has an aging audience, so that is going to affect ad dollars in the long term.”
BuzzFeed CEO Jonah Peretti and a Gannett spokesman both blamed newsroom layoffs on ”macroeconomic” forces, while Washington Post Executive Editor Sally Buzzbee acknowledged that “economic headwinds” were a factor in the paper’s belt-tightening, according to a memo obtained by TheWrap.
Representatives for Vice Media, Morning Brew, Protocol and The Recount did not immediately return TheWrap’s request for comment.
The news industry’s struggles date back to the early 2000s and have been exacerbated by changes to the advertising revenue model brought by a rise in social media and tech companies like Meta and Google, according to Allison Frisch, an assistant professor of journalism at Ithaca College.
“They target advertisers with their users’ data — a move traditional media companies haven’t been able to replicate, because the audiences for newspapers and cable news are moving to social media and streaming,” she explained to TheWrap. “Add to that a rise in inflation and slowing economy and news media companies are finding it hard to compete.”
She pointed out that the public generally trusted national and local reporters prior to the emergence of “social media echo chambers.”
“Social media has fractured and polarized many because it uses algorithms to feed content to people based on what they ‘like’ or click on. This eliminates the need for us to feel cognitive dissonance when we see something we don’t agree with,” she noted. “They then serve the audience to advertisers on a silver platter. With social media/big tech, the audience/users are their product, and advertisers are their customers, as it was in the 20th century television/commercial advertising model.”
While layoffs in the journalism industry continue to grow, some media outlets are trying to find alternative ways to cut costs.
NPR CEO John Lansing has warned that the company must cut at least $10 million from its current fiscal year budget, in part by reducing discretionary spending and non-essential travel and implementing a hiring freeze.
An NPR spokesperson told TheWrap that it’s working quickly to address its “severe budget challenge” while preserving and protecting its “critical public service” and prioritizing its people. A major portion of NPR’s revenues come through corporate sponsorships, which are “sensitive” to changes in the economy.
But Frisch warned that the layoffs will continue unless media companies evolve their business model to meet the demands of technology.
“Relying on advertising alone no longer works. So, media companies must diversify the ways they pay for the work journalists do,” she said. “It’s dangerous to believe that they can balance the books by eliminating journalists. They must be aggressive and creative about how they fund and disseminate this important work. This can include public media taking a larger role, philanthropy, non-profit and products such as newsletters, live events and even crowdfunding.”
Joseph Kapsch contributed to this report.