Thursday, March 29, 2012

Layoffs at Post-Star while parent company gives CEO nice bonus

Part of a series on troubles at The Post-Star and its parent company Lee Enterprises

by contributor Mark Wilson

Following months of seeming good news for Lee Enterprises, Inc., The Davenport Iowa Newspaper corporation which owns the Post-Star, has launched another round of layoffs across its portfolio.

The staff contact page at PostStar.com, which yesterday listed fifty-eight employees in Editorial and Business positions at the Glens Falls paper, today lists only fifty-one. Among the seven missing names/positions are:

• Photographer Aaron Eisenhauer


• Copy Editor Christopher Fitz Gerald
• Saratoga and Washington County Reporter Thomas Dimopoulos
• Washington County reporter Jamie Munks
• Washington County reporter David Taube
• Sportswriter Mary Albl
• Sportswriter Larry Hall

Stacy Perrone has also left the Post Star advertising department, but her position has been filled by Jillian Vitagliano.

Of these seven, Fitz Gerald, Munks and Albl had the shortest tenure at the paper, joining the staff only last Fall. Taube's first bylines and Eisenhauer's first photos appeared in the summer of 2010, Dimopoulos joined the newspaper in March 2007 and Larry Hall, the longest-serving member of the group, dates back over a decade to October of 2001. Similar layoffs have been announced at newspapers throughout Lee's stable of 49 daily newspapers.

In other news, Lee Enterprise this past week filed papers with the SEC declaring a $500,000 bonus for Chief Operating Office Mary Junck, and a $250,000 bonus for Chief Financial Officer Carl Schmidt. The two were credited at last week's shareholder meeting in Davenport with seeing the company through chapter 11 Bankruptcy earlier this year, despite assuring investors less than a year ago that the publisher's dire economic straights were not bankrupting the company.

The two head officers have also staved off delisting of the company stock from the New York Stock Exchange, with the assurance that the company's shareholders would accept a reverse stock split. Last week, Shareholders gave Lee's directors authority to go ahead with the reverse split—a move that could multiply the price of stock shares. The directors must decide on the ratio of the reverse split sometime before June.

Lee remains under a second delisting threat owing to the drop of its market capitalization (the number of outstanding shares times the share price) below $50 million. While recent movement of shares has pushed Lee's market capitalization above the threshold, the company has until next year to strengthen investor confidence and maintain the higher value for the long term.

This week's layoffs and last week's announcement that the web sites of all Lee newspapers will charge visitors subscription fees by the end of the year are the first mobilizations in that effort.

8 comments:

Mark Wilson said...

It is a matter of some concern to note that of the seven let go, only two, were hired before the recession took hold. The other five were hired (presumably) on a lower compensation scale than the people they replaced.

When looking to keep up staff numbers while lowering overhead, employers tend to fire the most expensive (and often the most experienced) employees and replace them with greener, cheaper ones. Generally speaking this round of layoffs does not seem to be following that pattern.

I think it is safe to say, while the Post Star may move to fill some of these positions, there will be a net loss both in volume and quality of reporting—the inevitable result of reporters and editors being spread too thin.

Anonymous said...

Add one more. Dont think they ever filled Mark Mahoneys job after he left last year.

Brian said...

They got rid of three reporters covering Washington County.

Does this mean they have no dedicated reporters covering a county which probably accounts for half of their readership?

Death spirals are never pretty.

Anonymous said...

Print Journalism has been on a downturn spiral for a long time, so this news isn't surprising. What is surprising is that Lee Enterprises has not found a way to be a forward moving company. They need to replace the old folks (sorry) and put in place young minds that know, or can figure out, what the future of newspapers will be and help place Lee Enterprises somewhere at top. Instead, they are taking the same path as other local papers and doing the same old thing, yet expecting different results. It will lead to their demise, and the printed paper will take another hit. Please wake up people, you don't have to be at the helm of a sinking ship.

Stephen said...

Not to be a downer, but all I see in the future is that this is going to get worse. Lee Enterprises has the lowest rate of revenue per employee of any large (by circulation) newspaper company. And not by a little either. Even in their best days, Lee had more reporters on the ground than could be justified by revenue. Newspapers were just so profitable, they could afford it. I would expect to see another 25% reduction in staff in the next couple of years. The only exception I can see to this would be the (slim) chance that the coming paywalls will pay off. I think the chances are slim, but possible- no one reports it in the news, because the techies are so in love with the ad-supported model, but paywalls have stopped circulation declines dead in their tracks at almost every single paper that puts them up. The ABC report from September showed that the 6 paywalled LEE papers completely stopped their declines overall, and that was only after one month of use. This ABC report in 4 weeks will be interesting. If those papers show GAINS in circulation, many Lee jobs might be saved. But...like I said, it seems doubtful and will be an uphill battle at best.

Anonymous said...

"...They need to replace the old folks..."

Yeah, age discrimination. Now there's a great idea.

Anonymous said...

Photographer Aaron Eisenhauer drove a van with Maine plates, so he had little connection to this area.
Now all news will come from the Big Three at the Post-Star: Tingley, Doolittle and Lehman.
New motto: "All police news, all the time."

Anonymous said...

Thanks for covering this. Disgraceful that they can pay out $750,000 in corporate bonuses, as they lay off low-paid reporters.