Laying off 23 at the Star

Dateline: Fri 15 Aug 2008

Here is the official memo from Michael Kane, Star publisher. Early word is that managers are being targeted.

August 15, 2008

TO: Employees of The Star

FROM: Michael G. Kane

President and Publisher

As you know, the newspaper industry is in the midst of tough economic times, joining the ranks of so many other businesses in our market and across the US. Because we do not see the present trend of declining revenues improving any time soon, Gannett's U. S. Community Publishing (USCP) Division has made the decision to reduce staffing across all levels of the organization.

In Indianapolis, a large portion of our payroll savings will be achieved by attrition and not filling open positions. There will, however, be approximately 23 layoffs. We're finalizing our plans and will complete layoff notifications next week. I am sending this letter now because I want you to know what is happening. I promised full and open communication and that is a commitment I stand behind. I realize that doesn't make it any easier for those who are affected but it might help a bit to understand the full situation. Employees who are affected will be notified individually and will be provided severance and medical insurance continuation based on their length of service.

As you may have heard or read by now, about 1,000 positions or roughly three percent of total employment, will be eliminated across the company. About 600 of these position eliminations will come through layoffs. Gannett is not alone. Most media companies are experiencing similar financial performance and staff reductions.

The big question on your minds is probably whether more job eliminations will come in the future. The only thing I can tell you is that we are working as hard as possible to turn around our revenue declines, and we have had some local successes. But so long as the declining overall revenue trend continues, we will be managing in a difficult environment. We must keep expense trends consistent with our revenue trends.

Despite disappointing revenue performance, our footprint in the market continues to increase as a result of your work. Our digital audience is growing and our reach is very strong. We continue to be the number one source for advertising and information in our market. Solid reporting, tremendous websites, excellent service and popular niche publications are all contributing to the positives that we are seeing. We're fortunate, too, that we will be adding approximately 55 jobs to the financial shared services center in our building when it is fully operational. Overall, I remain confident that there are better times ahead.

Unfortunately, in the short term we will be saying goodbye to some employees who have contributed to our success and that will be difficult. The goal, however, is to strengthen our company for the future, and to get through this economic downturn in a way that positions us to grow.

We will be holding employee meetings later this month. At these meetings I will update you on our business and help you envision our future.

Thank you for all that you do.

Please let me know if you have any questions.

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