The owner of the Daily Mirror, Daily Express and Daily Star newspapers is to axe 550 jobs amid falling print sales and advertising income.
Reach, which also publishes regional titles across the UK, announced on Tuesday it would reduce its workforce by 12 per cent in a bid to cut costs by £35m.
The group did not give details of where the job losses would fall but said it wanted to become a “streamlined, efficient organisation” with “more focused” editorial, advertising and central operations.
It will look to bring together national and regional editorial teams across its titles in a more centralised structure, close some local commercial and finance sites, and simplify its management structure.
But Reach said it would end the recent temporary pay cuts for all staff, except senior executives and board members, and invest more heavily in its digital operations amid an increasing shift towards online news.
Chief executive Jim Mullen said: “Structural change in the media sector has accelerated during the pandemic and this has resulted in increased adoption of our digital products.
“However, due to reduced advertising demand, we have not seen commensurate increases in digital revenue.
“To meet these challenges and to accelerate our customer value strategy, we have completed plans to transform the business and are ready to begin the process of implementation.
“Regrettably, these plans involve a reduction in our workforce and we will ensure all impacted colleagues are treated with fairness and respect throughout the forthcoming consultation process.”
Details of the job cuts came as Reach revealed group revenues had slumped 27.5 per cent in the second quarter to 28 June – dropping as much as 30.5 per cent in April – as sales of newspapers fell sharply amid the coronavirus lockdown. Despite readers switching online for their news, digital revenue fell 14.8 per cent as advertisers reined in spending.
Reach said circulation still remained “significantly” below levels seen before the pandemic, although it saw a “modest but encouraging” improvement in June with group revenue declines last month narrowing slightly to 23.9 per cent.
Digital sales falls slimmed to 4.9 per cent in June, while print revenues were down 26.7 per cent.
Reach – which owns major regional titles including Scotland’s Daily Record, the Manchester Evening News, the Liverpool Echo and Newcastle’s The Chronicle – said it was raising its customer registrations target to 10 million by 2022, having already hit its 2020 aim of more than 2.5 million.
The group also plans to ramp up spending to improve its digital customer experience and will launch a new self-serve online platform for small business advertisers.
Reach has more than 70 websites across news, sport and showbiz. As well as news titles, it publishes OK! magazine and the sports website Football.London.
The company joins a long list of firms – such as British Airways, Pret A Manger and Upper Crust owner SSP Group – to have announced major job losses during the pandemic.
UK newspaper publishers warned in April that they faced losing £50m in revenues this summer due to brands using “blocklist” technology to prevent their adverts appearing next to stories about the coronavirus outbreak.
News publishers could lose £50m as brands block coronavirus stories
Coronavirus job losses could ‘scar a generation’, CBI warns
VICE and The Economist announce job cuts
What are the UK lockdown rules now?
How to ease yourself back into socialising once lockdown lifts
The new lost generation
Which countries are seeing a second wave of coronavirus?
How to wear a face mask safely