N&O offering buyouts to 200 workers

The News & Observer will offer voluntary buyout packages to about 200 of its roughly 900 employees, publisher Orage Quarles III confirmed Monday.

The newspaper, owned by California's McClatchy Co. (NYSE: MNI), needs to cut positions to keep up with soft advertising revenue and increases in newsprint and gasoline prices, Quarles says. Newspapers across the country are struggling with similar problems, which are being exacerbated by competition from Web sites and declining daily newspaper readership,

"We don't see any of those trends changing anytime, so we're trying to do to the prudent thing," Quarles says.

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The N&O's buyout is being offered to employees based on the needs of the newspaper, Quarles says, though he declined to break down the number by department. The buyout is not being offered based on seniority; other newspapers have been able to improve the participation rate in their buyouts by offering them to workers who were close to retirement.

Despite a report on the paper's Web site saying that he expects 1 percent to 2 percent of affected employees to accept the buyouts, Quarles says he doesn't know how many people will take the deal.

"As I was trying to explain to our reporter, we really just don't know," Quarles says. "It varies. It depends on people and where they are in their personal lives."

Employees will have until the end of next week to decide whether they want to take the deal, Quarles says. The target date for the workers to leave the newspaper is May 23. He says it hasn't been decided what action would be taken if the newspaper can't cut the number of jobs that it ultimately decides should be eliminated through the buyout.

"That all depends," Quarles says, saying that revenue and expense trends over the next few weeks will give the newspaper's executives a better idea of what they need to do.

N&O employees affected by the buyout were to be notified Monday afternoon.