Media expert April Lindgren believes that Postmedia’s acquisition of Atlantic Canada’s largest newspaper chain, SaltWire Network Inc. and The Halifax Herald Ltd., will likely result in job cuts and a reduction in local content. Postmedia has a history of closing unprofitable publications, having shut down 57 news outlets since 2008, more than any other media company in Canada. Lindgren does not anticipate a change in Postmedia’s strategy of cutting expenses and reducing the number of reporters on the ground with this deal. The acquisition is subject to approval from the Nova Scotia Supreme Court and to satisfactory outcomes with unionized workers, but no financial details have been disclosed.
Postmedia is known for limiting its investments in local news, which raises concerns about the further erosion of local news space through this acquisition, according to journalism professor Magda Konieczna. While federal programs such as the Local Journalism Initiative and Canadian journalism labour tax credit have helped struggling media businesses, Konieczna believes more policy support is needed to build a local news ecosystem that is responsive to the needs of local communities. Lindgren, principal investigator for the Local News Research Project, notes that media businesses began cutting costs and shutting down operations again after the COVID-19 pandemic when government subsidies dried up and advertising revenue did not fully recover to pre-pandemic levels.
Lindgren points out that while Postmedia has faced criticism for its cost-cutting strategy, other media companies like SaltWire have also closed numerous news outlets. She mentions that a total of 521 news outlets have been closed in Canada since 2008, with the majority being community newspapers. At flagship newspapers like the Chronicle Herald in Halifax, layoffs are nothing new, as the number of reporters has decreased significantly over the years. Similarly, at Postmedia’s Ottawa Citizen, the number of editorial staff has dropped significantly. Lindgren suggests that this trend of reducing staff is mirrored across the country in various media companies.
Media companies like Postmedia and SaltWire are facing challenges due to the harsh realities of the media industry, including declining advertising revenue, lack of government subsidies, and the continued impact of the COVID-19 pandemic. Lindgren emphasizes that advertising revenue has not bounced back, and the removal of government subsidies has made the situation more difficult. While SaltWire and The Herald may face difficulties in cutting jobs due to previous layoffs, Lindgren believes that the overall trend of layoffs and reductions in staff is pervasive in the media industry. The need for support for local news organizations remains high, especially as the industry continues to struggle financially.
In conclusion, the pending acquisition of Atlantic Canada’s largest newspaper chain by Postmedia is expected to lead to job cuts and a decrease in local content, given the company’s history of closing unprofitable publications. Media experts like Lindgren and Konieczna express concerns about the erosion of local news space and the need for more policy support to build a responsive local news ecosystem. While the challenges faced by media companies like Postmedia and SaltWire are significant, the overall trend of layoffs and reductions in staff is prevalent in the industry. With declining advertising revenue and the absence of government subsidies, the media industry is facing ongoing difficulties, necessitating further support for local news organizations to ensure the continuation of vital journalism in communities across Canada.
