Layoffs Loom at Consumers Union

Consumers Union, the publisher of subscriber-supported Consumer Reports magazine, is feeling the economic pinch along with ad-supported media.

The nonprofit organization eliminated raises and bonuses for its managers and exempt employees starting June 1. Now, it’s threatening to lay off 21 people—its first economic layoff—unless it can find $1.8 million in cost savings.

Consumers Union last week notified the Newspaper Guild of New York, which represents some 350 scientists, writers, researchers and administrative staff, of the possible layoffs.

Consumers Union employs more than 600 people, the bulk of whom work for Consumer Reports magazine.

One benefit that could land on the chopping block is a 3 percent pay increase that union members were slated to get in January 2010. Eliminating those raises could save around $1 million, according to a guild rep.

Consumer Reports doesn’t take advertising in order to maintain its independence from the products it evaluates, instead relying mostly on print and online subscriptions and newsstand sales. But in recent months, the nonprofit has experienced softness across those areas as consumers have reduced spending.

Consumers Union has branched out in print and online in recent years, launching ShopSmart magazine and buying Consumerist.com, a watchdog blog.