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Newspaper publisher Reach announces job cuts affecting 200 staff

By Hugh Fort in UK Business News, posted January 11, 2023

One of Britain's biggest newspaper publishers has announced more job cuts as 200 staff faces the axe due to “unprecedented cost and inflationary pressures”.

HoldtheFrontPage.com reports Reach PLC, which owns the Daily Mirror, the Daily Express and the Daily Star as well as a range of regional "Live" websites across the country, is shedding more roles.

The majority of the cuts are likely to be in editorial departments, and follow reporters on national titles like the Daily Express going on strike over working conditions and pay last year.

Chief executive Jim Mullen made the announcement in a trading update, which reveals the group is aiming to make savings of £30 million in 2023.

Reach has not revealed how many jobs will be cut in editorial departments, but it is understood reductions are likely to be made across the country.

The company employs 4,671 staff, 3,119 of which are based in editorial, which is around two-thirds of the workforce.

Reach recently announced a massive expansion into the US, with new titles set to launch.

It is not known whether the move will affect these plans, which are seen as a major priority.

In a message to staff, Mr. McMullen said: "In recent months our business has been impacted by a significant increase in input costs.

“The unit price of newsprint, for example, has increased by around 60pc in the last 12 months.

"This increase in a major input cost for us has aligned with a consumer downturn due to inflation and cost pressures.

“Our business is being subjected to stresses at both ends of our finances – that is revenues and costs negatively impacted, and at a rate of change our company has quite simply never seen before.

“To put this into some context; during Covid, our revenues were severely impacted due to national lockdowns and a closure of a number of business sectors, with a resultant reduction in consumer and advertising spend.

“However, costs remained relatively stable. We now have a similar impact to consumer spend for different reasons, but also input cost inflation making it a double whammy.

“All of this on top of the significant cash outflow relating to historical legal issues and pension deficit obligations, between them around £70m per year, puts us in an extremely challenging position.

“We’re not alone in facing these challenges and we have a way through this, but I want to be honest with you now about the fact that it will mean us taking some very tough operational decisions and strong actions on costs.

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“As part of this, having explored all practical alternatives, we have made the difficult decision to begin consultation on a proposal to make around 200 roles across the group redundant, and withdraw a number of vacancies.”

The publisher says it plans to make the savings through “simplification of central support functions, supply chain efficiencies in print and distribution, and accelerated removal of editorial duplication”.

A Reach spokesperson added: “We expect the macroeconomic climate to remain challenging in 2023 and have therefore taken decisive action, putting a comprehensive cost reduction plan in place.

“While this regrettably includes around 200 redundancies, in addition to removing a number of open vacancies, this early action will allow us to protect our organisation and ensure we continue to deliver on our Customer Value Strategy.

“We will continue to review all aspects of our ongoing strategic transformation to ensure we are well placed to benefit once industry trends return to more normalised levels of activity.”

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