Tuesday, December 09, 2008

This Week's Unpleasant Book-Publishing News

It's not that I expect a bunch of layoffs tomorrow -- it's just that I want to be ready if they happen. I hope not to have to update this post half a dozen times, as I did last week, but we'll see.

First up: Macmillan announced today (Tuesday, December 9th) that, like Penguin, all raises are frozen as of the new year for anyone making $50,000 or more. (Does that imply a flurry of end-of-the-year raises to some fair-haired sorts?)

And Wiley reported 2Q earnings Tuesday morning, at 2% above prior year, but I already blogged about that.

Fingers crossed, but there's nothing so far today (Wednesday).

So let me remind you that Sonny Mehta always wins. No one seems to be sure why; he just does.

Update (Thursday, Dec. 11):
Publishers Weekly reports that Canadian publisher Kids Can Press has eliminated three positions.

Chronicle Books also is having layoffs, "under 5%" of an unspecified current staff level.

Perseus Books Group is freezing raises, stopping hiring, and suspending 401(k) contributions, but not actually (yet?) firing anybody.


Anonymous said...

My husband works for Houghton Mifflin Harcourt, and he got word today that he will likely be laid off Wednesday or the day after.

HMH will cease to exist in a year or so. I myself was laid off from HMH last summer and I witnessed a frightening brain drain that they have made no move to replace. The same thing will happen when my husband's department is eliminated.

Oh, and layoffs before the holidays? KLASSY!

Ran said...

Why _did_ so many layoffs take place in publishing at around the same time? I've never quite understood why these things seem to happen together. Is it herd instinct? Everyone waiting for someone to do it first, so they can all then just point to them and say, "Hey, they're doing it"?

On a completely separate topic, a discussion regarding "what does a writer owe his readers" made me wonder something that you and other publishing-types might be able to answer...

Can/Do publishers take out insurance on contracts with authors? I was thinking about the dangers of being a commercial enterprise who depends on creative output, with the various difficulties that that involves, and it reminded me that movie studios take out all kinds of insurance on their productions. Insurance against delays, insurance against particular stars not being able to fulfill their commitment, and so on.

I'm guessing the answer is "No", for various half-formed reasons, but I wanted to find out for sure.

Andrew Wheeler said...

1) Why Now?
I don't speak from personal experience, but apparently many companies have a fiscal year tied to the calendar year, and layoffs need to happen at least a few weeks before the end of the fiscal for accounting purposes. So: you don't want to fire people the day before Thanksgiving or Christmas, so you do it in between.

Also, Wednesday is reportedly the best day for layoffs. (Says the man who was let go on a Tuesday last year, so take that with a grain of salt.)

On top of that, it's not just publishing -- Sony just announced 8,000 job losses, AT&T is dropping 12,000, and so on. The economy is lousy right now, so nearly everyone is shedding jobs.

And the timing of the announcements was much too close for any of the companies to be reacting to each other; they were all independent decisions. (But layoffs this week -- and other moves, like Macmillan's pay freeze, which mirrors Penguin's -- could have been affected by last week's news.)

2) Insurance on Contracts
I know it's possible to take out, for example, a life insurance policy on an author -- nearly anyone can take out a policy on nearly anyone else, actually -- but I don't believe it's done as a matter of course.

It sets an unpleasant tone with the author and her agent, for one thing -- if the publisher stands to profit by the author's demise, that author is not going to feel as kindly towards the publisher.

More general insurance is possible, but I don't know of any details. Only someone on the finance side of publishing could answer that, and I don't know of any green eye-shades types who blog.

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