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D-G Offers Voluntary Furloughs in Pandemic Crisis; Paxton Cuts Jobs

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As other Arkansas daily newspapers bleed staff and cut back printing in a pandemic-fed revenue crisis, the Arkansas Democrat-Gazette has given employees a dilemma: Accept a work furlough now to cut the odds of being laid off later.

In an email to the staff Monday, Democrat-Gazette President Lynn Hamilton said the company was “seeking voluntary help from employees in an effort to possibly avoid mandatory reductions.”

Hamilton, conveying a note “to all full-time newspaper employees” from Wehco Media CEO Nat Lea and Chairman Walter Hussman Jr., the paper’s publisher, said the paper had to “find ways to temporarily reduce costs until the economy recovers.”

Hussman and Lee, writing that the pandemic had unleashed “the largest collapse of advertising in over 40 years of newspaper publishing,” offered workers several “voluntary measures” to cut payroll expenses, including working four days a week for commensurate pay or accepting furloughs with a to be rehired.

Like Arkansas timber executive Steve Anthony and others, Lea and Hussman pointed out that unemployment benefits enhanced by the COVID relief package approved by Congress last month could tempt some employees. “Because of the extraordinary step taken by the federal government, we know unemployment compensation has a floor of $600 a week, and it would be higher than that when you add the state’s contribution,” the memo said. “In some cases, employees could receive more from unemployment compensation than from their normal wages.”

The Democrat Gazette, which switched to a Sunday-only print schedule last year while delivering a digital replica of the paper to subscribers through company-lent iPads, said it would keep furloughed workers on its group health care plan, paying the whole premium for the time the employee chooses to be furloughed.

Of course, there is no guarantee furloughed workers will be taken back, or even that particular furlough requests will be accepted, the memo said, noting that “the company would have to retain the right to decide whether to accept any voluntary offer.”

Workers interested in the offer were asked to notify their supervisors by the end of the week.

Layoffs at Paxton Papers

Over the weekend, news filtered out about layoffs at Arkansas papers owned by the Paxton Media Group of Paducah, Kentucky. Cuts were reported at the Searcy Daily Citizen, the Russellville Courier and, most notably, the Jonesboro Sun.

The layoffs and print cutbacks, including a decision by the Paxton-owned Log Cabin Democrat to cut back to five days of publication from six, come against a backdrop of deep advertising losses in a field where 70% of revenue vanished in a seismic shift of advertising dollars away from newspapers and to Facebook, Google and YouTube, according to Ken Doctor of Nieman Lab; other industry followers suggest half of the remaining revenue has evaporated during the pandemic.

The Jonesboro Sun, which is also cutting to five days of print, reportedly laid off Assistant Managing Editor Joe Schratz, once an editor at the Arkansas Democrat, and news reporter Adria Hyde. Schratz confirmed his departure in a Facebook post.

The Sun also cut two of its three sports staffers, who which of course have no games to report on presently. Sports Editor Kevin Turbeville kept his job, but was reportedly furloughed for eight weeks.

Max Brantley, writing about the Democrat-Gazette offer in Arkansas Times on Monday, said his paper faces the same gloom, but with fewer resources than Hussman, who was once rated as the seventh richest Arkansan but confided to Arkansas Business in 2017 that his net worth “isn’t what it used to be.”

Arkansas Times “shifted from weekly to monthly publishing this year,” Brantley wrote. “We’re now seeking the help available for small business loans in the federal stimulus package and soliciting support from readers. Higher paid employees have taken pay cuts, but we’ve resisted furloughs so far.”

Brantley pointed up the irony that local news outlets are more valued and trusted than they’ve been for years, but now face extinction. “Local news providers — the better and more vigorous the better — have never been more important.”

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