Home » US Employment News » Gannett CEO faces backlash as journalists strike over layoffs and pay issues

Gannett CEO faces backlash as journalists strike over layoffs and pay issues

By Nithya Bose in US Employment News, posted June 6, 2023

Hundreds of Gannett journalists have gone on strike, blaming the company's chief executive for the decline of local newsrooms.

The walkouts held on Monday, June 5, mark the largest labor action in the company’s century-long history.

Employees from approximately two dozen newsrooms, including The Palm Beach Post, The Arizona Republic, and The Austin American-Statesman, joined the protest.

Demonstrations were expected to continue in some newsrooms today (Tuesday, June 6).

The coordinated action coincided with Gannett's annual shareholder meeting on Monday morning.

The NewsGuild, representing over 1,000 Gannett journalists, sent a letter to shareholders in May urging a vote of no confidence against CEO and Chairman Mike Reed.

The NewsGuild criticized Gannett's 2019 merger with GateHouse Media, citing the excessive debt burden and a detrimental impact on the company's future.

The letter also expressed concerns over Reed's compensation, which amounted to $7.7 million in 2021 and $3.4 million in 2022.

The union deemed these figures excessive, considering the company's job cuts and the allegedly low wages offered to remaining journalists.

Gannett's stock price has plummeted approximately 70 percent since the merger with GateHouse.

Peter D. Kramer, a reporter for the USA Today Network, said Gannett's actions have created "news deserts" across the country.

He noted that some reporters have had to seek additional employment to make ends meet or abandon the profession altogether.

Gannett spokesperson Lark-Marie Anton said the company “remains committed to our shareholder engagement process and takes all feedback seriously.”

Anton added that the newspaper chain remains focused on investing in local newsrooms and negotiating fairly with the NewsGuild.

During the work stoppage, Gannett assured there would be no disruption to news coverage.

However, at the shareholder meeting, the board of directors, including CEO Mike Reed, was retained.

Susan DeCarava, president of the NewsGuild of New York, described this outcome as a "slap in the face" to the striking journalists.

After merging with GateHouse, Gannett became the largest newspaper publisher in the country, owning over 200 daily newspapers across 43 states.

However, like many other local news publishers, Gannett has faced declining revenue from advertising and print circulation.

The heavy debt from the merger has further burdened the company, leading to cost-cutting measures and significant job reductions.

Gannett reported over $1.2 billion in outstanding debt in its first-quarter earnings report this year.

The company has attempted to alleviate the debt through various cost-cutting measures, including laying off around 6 percent of its media division workforce in December.

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According to securities filings, Gannett's workforce has decreased by almost half since November 2019.

Journalists from The Austin American-Statesman, The Arizona Republic, and The Milwaukee Journal Sentinel provided examples of newsroom shrinkage.

They stressed the negative consequences for communities left with inadequate coverage.

The NewsGuild highlighted the urgent need for investment in journalism to support democracy, accusing CEO Mike Reed of prioritizing personal gain over the company's long-term strategy.

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