The parent company of The Los Angeles Times is furloughing 40 employees and cutting the pay of senior managers in an effort to make up for losses brought on by a pandemic-related decline in advertising revenue.
“Due to the unexpected effects of Covid-19, our advertising revenue has nearly been eliminated,” said a memo to the staff on Tuesday from Chris Argentieri, the president of California Times, the publishing company that includes The Times and The San Diego Union-Tribune.
The Times newsroom cheered in 2018 when Patrick Soon-Shiong, a billionaire doctor and entrepreneur, bought The Times and other California publications from what is now Tribune Publishing for $500 million. While The Times has gotten more robust since then, its digital subscription business has been slow, and now the coronavirus has presented a new challenge.
In a separate letter to some staff members on Monday, Mr. Argentieri said, “The Times has lost more than one-third of its advertising revenue and expects to lose more than half of its advertising revenue in the coming months.”
The furloughed employees do not work in the Times newsroom. They could be out as long as 16 weeks, according to the Monday memo, and it is possible that they will be laid off at the end of the furlough period.
As part of the austerity plan, pay for senior editorial and business managers at The Times and The Union-Tribune will be reduced by as much as 15 percent for three months, and 401(k) matches will be suspended.
The cuts do not apply to union employees who belong to the NewsGuild. Mr. Argentieri said company leaders would meet with union representatives to address “cost-saving initiatives.”
In a statement, the Times union said it was “troubled to learn about” the furloughs.
A New York Times analysis found that more than 28,000 news media employees in the United States have been subject to pay cuts, furloughs or layoffs since the coronavirus started to spread across the country.
The Los Angeles Times is one of the largest papers in the nation, with a Sunday print circulation over 400,000. Mr. Argentieri said the furloughs and other measures were necessary for the California Times publications to weather the sudden drop in revenue.
“While we’ve made significant progress in growing our digital subscriber base and developing other sources of revenue,” he wrote in the Tuesday memo, “it is not yet enough to offset the losses.”
Like many news outlets, The Times has seen a spike in its web traffic in recent weeks, as readers have sought updates on the pandemic, according to comScore.
Norman Pearlstine, the executive editor of The Times, published a note to readers on April 2, saying it was “more important than ever” that they subscribe.