Back in 2007, a journalist named Erica Smith launched a website called Paper Cuts. Using a combination of Google Maps and media reports, she tracked announcements of layoffs within newspapers and mapped them across the United States. These were the darkest days of journalism, when the Great Recession drained companies of their advertising budgets and the internet made strong inroads at eroding the display and classifieds business that had previously allowed newspapers to maintain a strong profit margin. By early 2009, Smith had documented 26,000 layoffs — with over 15,000 in 2008 alone. She seems to have ceased updating the site in 2012, but she left behind a chronicle of carnage, one that an aspiring journalist could look at and reasonably conclude that a job wouldn’t be awaiting her when she graduated college.
Since then, with the economy picking up steam, the outlook hasn’t seemed as dire. Budgets are still tight and newspapers are still hurting, but several publications have announced their first revenue gains in years. Forbes went from a magazine unable to pay its rent to a profitable publishing company. The New York Times launched a pay meter that generated real revenue and gave many journalists hope that the industry was adapting and that readers would pay for content after all. Venture capitalists began to drop real money into news-centric companies, investing millions of dollars everywhere from Buzzfeed to Circa.
And yes, we’re still treated to news of media layoffs. Recently, Conde Nast, the New York Times, CNN, and Yahoo have all announced they’re letting people go. But instead of signalling the death knell of journalism, they often are the result of a corporate restructuring in which one division of the company faces layoffs while a separate division — usually digital — is still actively hiring.
Take CNN, for instance. It recently announced 150 job cuts. This is how Brian Stelter addressed the layoffs on Reliable Sources:
It is unfortunately happening all over the place. Conde Nast, the publisher of Vogue and Wired, is laying off 70 to 80 people this fall. My former employer the New York Times is cutting 100 from the newsroom.
And yet they, like CNN, have been hiring people, too, lots of people, mainly for online jobs. That’s for new apps, for new web sites, for new ventures.
Now, there is some overall shrinking going on. But the better word for what’s happening in media today is “reshaping.” Through layoffs, through cuts, through new investments, “reshaping” for the digital future that really feels more like the digital present. It’s already here
The same can be said for the other companies I listed. The New York Times announced 100 newsroom layoffs, but it came as the company is expanding in many areas; its newsroom headcount, 1,330, is “approaching its largest size ever, according to the company, up from about 1,250 at the end of last year.” Sure, Yahoo let go of 400 people in India, but Marissa Mayer is also sitting on a $5.8 billion war chest that she plans to use for acquisitions and acquihires. With the hiring of journalists like David Pogue and Katie Couric, as well as the purchase of blogging platforms like Tumblr, Yahoo is putting significant weight behind digital content.
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In other words, unlike the layoffs in the late-aughts, which were interpreted as the result of an industry in decline, many of the most recent layoffs can be seen through the lens of an industry in transition. Media companies are freeing up capital to reinvest in their digital properties. Of course, this could all just be hopeful optimism and an example of me taking corporate spin at face value, but it has seemed evident to me for at least the past year that media entities, for the first time, have begun accepting the fact that display banner advertising will never yield significant return and that they need to develop new business models and revenue generators if they’re able to turn their ships around. And this influx of capital due to a rising economy may indeed be their last shot at doing so.
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Image via New Deal of the Day