HarperCollins to cut North American workforce by 5%

Jan 31, 2023, 10:40 AM | Updated: 10:52 am

NEW YORK (AP) — HarperCollins Publishers plans to cut its workforce by 5% in the U.S. and Canada by the end of June, citing increased costs and lower sales in a statement released Tuesday.

The announcement comes the day before HarperCollins and the union representing some 250 striking employees are to meet with a federal mediator, the first negotiations since the strike began more than two months ago.

HarperCollins cited similar issues in laying off a “small number” of staff members last fall. A new round of layoffs has already started, although the company expects reductions to come through a combination of layoffs and positions left unfilled.

“As noted last October, HarperCollins continues to experience unprecedented supply chain and inflationary pressures resulting from the pandemic, including increased paper, manufacturing, labor, and distribution costs,” according to the company’s statement. “Coupled with declining sales over the last few quarters, these issues have resulted in us having to make difficult decisions to realign the needs and resources of the business.”

The company said it will implement “a variety of cost-saving measures” in addition to the workforce cuts in North America.

HarperCollins, part of Rupert Murdoch’s News Corp, has around 4,000 employees worldwide, more than half located in North America.

Editorial assistants, production designers and other mid- and entry-level employees have been on strike since Nov. 10, with salaries among the issues. The employees, who have been without a contract since last spring, are represented by Local 2110 of the United Auto Workers.

“The company has not communicated with us on this matter so we are still investigating the scope of layoffs,” Olga Brudastova, the local’s president, told The Associated Press.

Most of the major New York publishers saw sales decline after 2021, one of the best years in recent memory for the industry, although none have announced the kinds of reductions intended by HarperCollins. In its most recent earnings statement, which came out in November, the publisher reported an 11% drop in revenue and a 54% drop in earnings for its first fiscal quarter of 2023.

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HarperCollins to cut North American workforce by 5%