Publishing giant to cut 70 jobs

Fairfax Media is cutting another 70 jobs in New Zealand after 160 last year and is considering signing up to the Government- subsidised nine-day fortnight.

But the group is still "absolutely committed" to preserving jobs in the current economic climate according to outgoing chief executive Joan Withers.

Fairfax cut 160 jobs in New Zealand last year and almost 400 in Australia. The Australian- based publisher, which owns more than 80 newspapers and 25 magazines in New Zealand including The Press, The Dominion Post, and The Sunday Star Times surprised staff yesterday by revealing further cuts were imminent.

New Zealand chief executive Joan Withers told BusinessDay that steps to streamline pre-press and advertising production into four regional hubs and reduce headcount by a third were necessary if the company wanted to stay ahead of the pack.

"We're trying to preserve as many jobs as we can but still maintain a cost base that's competitive," said Withers. "If you hark back to past technologies in newspapers, you know there used to be hot metal, we have to keep moving forward.

"The board has invested more in the last five years [in infrastructure and technology] than Independent News did in their 20 years, but these processes have the ability to reduce headcount and that's what's happening here."

Along with the job cuts, the company was also looking at further cost-cutting measures including the possibility of signing up for the Government's nine-day working fortnight.

While that proposal was only in the discussion stage, it could apply to staff across the board.

Two large firms - Fisher and Paykel and Oamaru's Summit Wool Spinners - have joined the Government's taxpayer- subsidised nine-day fortnight scheme, as has a small manufacturer.

Social Development Minister Paula Bennett said this week there had been approaches from about 60 firms, mostly in the manufacturing and construction sector.

Pre-press workers are responsible for creating and managing advertising material and are based across all publishing sites throughout New Zealand.

Consolidation, due to be completed by the end of August, will see the firm's ad staff relocated into hubs in Auckland, Hamilton, Wellington and Christchurch, with a few staff remaining at satellite sites.

"The hub structure will consolidate and streamline our production workflow, processes and workforce in a way that delivers lower cost, higher productivity and better quality," said Withers.

The cuts - 70 from 218 staff - would have come regardless of the current recessionary conditions, she said, but the current economic climate and challenges facing media companies "underscored the need for companies such as ours to have a competitive cost structure".

Withers was one of the business leaders involved in the government's recent Jobs Summit, which aimed to protect jobs through a range of initiatives including a nine day fortnight.

Withers co-chaired a workshop at the summit on skills and transition.

Last year under Withers' stewardship 160 jobs were axed within Fairfax New Zealand - part of 550 jobs to go on both sides of the Tasman.

"It's about minimising the number of job losses and we're working very hard to do that and to mitigate the impact, so I guess the work stream I'm involved in for the job summit can help with that."

The final structure and number of redundancies will be confirmed once consultation with affected staff is completed over the next two weeks. Fairfax will ask for expressions of interest in voluntary redundancy.

Withers steps down from her current role at the end of June.

Andrew Little, president of the Printing and Manufacturing Union, said that the cuts smacked of hypocrisy, given businesses' and the government's efforts to protect jobs through a series of initiatives stemming from the recent Job Summit.

The Fairfax boss had an integral role in those initiatives.

"It's the nature of the industry, unfortunately, with declining revenues, but certainly it does nothing for the quality of newspapers to keep reducing the headcount, especially at a time when the government is trying to protect jobs."

- © Fairfax NZ News