McClatchy to cut 1,600 jobs

SACRAMENTO, Calif. (AP) -- Newspaper publisher McClatchy Co. said Monday that it plans to eliminate 1,600 jobs, or 15 percent of its work force, as it contends with declining revenue and a deepening recession.

The company, which owns The Miami Herald, The Sacramento Bee and other properties, had said that it planned deep cost cuts this year, hoping to save between $100 million to $110 million, and slashed its dividend 90 percent.

But Chairman and Chief Executive Gary Pruitt said in a statement Monday that "given the worsening economy, we must do more."

The cost-control efforts come as McClatchy is faced with plunging ad revenues plaguing the entire publishing sector, as well as trying to recover $5.3 million owed by newspapers it had sold to companies that have recently filed for Chapter 11 bankruptcy protection.

McClatchy also has its own debt worries. The company owed about $2.04 billion as of the end of 2008, stemming mainly from its 2006 acquisition of the Knight Ridder newspaper chain.

While the job cuts will not solve all McClatchy's troubles, the company said its cost-control efforts excluding severance and other benefit charges related to previous reductions led to a 14.4 percent drop in cash expenses for the fourth quarter.