The Independent has put more than a fifth of its staff at risk of redundancy as the declining digital advertising market and wider deteriorating economic conditions force the online-only publisher to look to cut costs.
The publisher has put 52 jobs at risk of redundancy in the UK – including 30 in editorial roles – out of around 240 employees.
The need to cut costs was reportedly driven by the decline in the digital advertising market – which also affected Facebook and Instagram owner Meta and saw Google-owned YouTube record its first-ever drop in revenue – as well as a change in Facebook policy. algorithm affecting the content that appears in users’ News Feeds implemented earlier this year.
The Independent, which recorded a fifth consecutive year of profitability in 2021, said that despite investment and growth in areas such as its online TV service, e-commerce business and expansion in the United States, it must now cut costs.
“We are in the midst of an extremely difficult economic climate, with financial headwinds affecting the entire industry,” Zach Leonard and Christian Broughton, managing director and managing director of The Independent, respectively, said in an email on Wednesday. email to staff.
“In view of these unfavorable conditions, the Board of Directors has had to review the resources of our business and in doing so, it is proposed that, subject to consultation, operating costs be reduced and certain roles in the company are closed.”
The cuts come despite the Independent, in which Russian-British businessman Evgeny Lebedev is a shareholder, attributing its investment in journalism for doubling profits last year from £2.7million to £5 £.48 million.
“[This was] following continued investment in editorial teams in the UK and US, as well as an expansion of its network of foreign correspondents located around the world,” the company said in its annual accounts for the ending October 3, 2021, filed at Companies House earlier this year.
Leonard and Broughton said affected staff members have been briefed on the plans and “any new roles available will be discussed with them as a matter of priority, before anything is announced externally”.
The company said that if suitable new roles cannot be found, redundancies will be made, with a consultation to begin “exploring ways to avoid or reduce the number of redundancies”.
The Independent, which closed its print editions in 2016 while beginning to build its presence in the United States to expand its digital-only offering, reported a 36% year-over-year revenue increase from £30-41m in 2021.
UK revenue increased by 57% from £15m to £23.5m, US and Canada increased by 29% from £7.6m to £9.9m , while revenue from other territories increased by 90% from £5.2m to £9.9m.
When filing the annual financial report in February, Leonard set an optimistic tone saying that its last financial year had started well and that the group “continued to deliver good audience and revenue performance in line with its business plan. “.
However, as the deteriorating economic situation has led the publisher to seek to reduce its annual cost base by £24m in 2021, from £19m in 2020.
“It is by making the tough decisions to meet challenges and embrace change that we can maintain the strength of our business, continue to create opportunity and fund more innovative, independent and award-winning journalism for many years to come,” said Leonard and Broughton.
In July the Evening Standard, where Lebedev also has a stake, reported a loss of £14m for the last year as the Covid pandemic continued to cut advertising revenue and commuters stayed at home, carrying the London Free newspaper’s losses to nearly £70m in the past. five years.
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