Crisis at the Gazette, Part Two

Thursday, July 31, 2008 will go down as a black day in the history of the Gazette. But its ramifications can be understood only in the context of how the newspaper operates on a daily basis.

The Gazette covers four counties: Montgomery, Prince George’s, Frederick and Carroll. It maintains offices in Laurel (for reporters covering Prince George’s and eastern Montgomery), Gaithersburg (for Montgomery), Frederick (for Frederick and Carroll) and Annapolis (for state politics). Each of the non-Annapolis offices has a cluster of reporting desks that are overseen by an assistant managing editor. Each cluster covers areas that are geographically close together. For example, the northern Prince George’s cluster includes Laurel, College Park, Hyattsville and Greenbelt. A cluster includes community reporters who cover specific areas but their stories can run in other areas nearby. So a story from College Park may also run in the Laurel and Greenbelt editions of the Gazette. The key supervisors in this structure are the assistant managing editors and their immediate superiors, the managing editors. Reporters on county politics, education, sports and business work directly for managing editors in each county.

The backbone of the Gazette is its network of community reporters. Each one is assigned a specific beat, such as Takoma Park. The newsweek starts when the new edition is produced (either on Wednesday or Thursday). The community reporters have meetings with their assistant managing editors at the start of the newsweek. They pitch their own ideas and also receive assignments from above. Each community reporter is expected to produce 5-6 stories per week. Most of the work occurs at the initiative of the community reporters – they are expected to visit relevant events, maintain contact with sources and track down new info. If the community reporters score an especially important story, it might appear in multiple editions of the Gazette or even the Washington Post. It is a challenging job.

Even so, Gazette reporters are some of the lowest-paid college graduates in the entire Washington metro area. Their starting pay is $26,500, disbursed on an hourly basis. If they stay six months, their annual pay increases by $500. If they last a year, their pay goes up by $1,000. They are eligible for the Washington Post Company’s health care plan but must pay the premiums out of their checks. They have a 401(k) plan but their base salaries are so small that few save large amounts in it. The Gazette reimburses them for gas at 36 cents per mile – well below the IRS rate of 58.5 cents. Unlike their counterparts at the Washington Post, Gazette employees are not represented by a union. As a result of the newspaper's compensation policies, most Gazette reporters are single people in their twenties, often living in group houses and commuting from cheaper areas. Few Gazette reporters can afford to live in the communities they cover and many come from other parts of the country.

Worst of all, Gazette reporters are paid only for 40 hours per week and do not receive overtime. This is a serious problem since community reporters often attend night meetings and sometimes weekend events. It does not matter whether a reporter works 50 or 60 hours per week or even more – it is considered “part of the job” and is not reimbursed. U.S. wage and hour laws generally require overtime payments for non-exempt, non-supervisory employees.

On July 31, everything got worse. The Gazette announced it was eliminating 23 positions - a full 14% of its workforce. Among those released were the Silver Spring managing editor (an individual with 15 years experience in the job) and two managing editors in Prince George’s County. The rest of the employees – especially the critical assistant managing editors – will be expected to pick up the extra workload with no commensurate increase in compensation. The layoff announcement shocked the workforce and prompted additional resignations.

In explaining the terminations, Gazette management mentioned the twin pressures of falling ad revenue and rising newsprint prices. They also cited the need to invest in their website (although they did not elaborate on how a beefed-up website with less reporter-generated content was supposed to improve the bottom line). Interestingly, management never directly addressed the question of whether the Gazette is profitable. If the Gazette is indeed losing money, it would make sense for them to tell the employees in order to obtain their buy-in to the new business plan. But management never formally commented on whether the newspaper is making money and that omission may hint at an underlying truth.

In Part One, we chronicled the financial condition of the Washington Post Company, owner of the Gazette. The parent company is slowly making a transition to becoming an educational services firm built around its Kaplan Inc. subsidiary. The Post Company does not release financial information pertaining to the Gazette, but its circulation has been relatively stable since 2000. That may not matter, however. Because the Post Company is trying to grow Kaplan, its publishing divisions may be increasingly viewed as cash cows. Their costs must be constrained and any net income they earn must be channeled into Kaplan for the long-run benefit of the company. It does not matter how hard the Gazette reporters work or how good their coverage is – it is irrelevant to the Post Company’s ultimate goals.

The Gazette’s business model and the pressure it is enduring from its parent company represent a dangerous threat to political discourse in its service area. We will explore how in Part Three.