RDA Cuts 8% of Worldwide Staff

Reader’s Digest Association, publisher of Reader’s Digest and Every Day with Rachael Ray, is whacking 8 percent of its workforce worldwide, citing lower consumer spending and magazine advertising.

The cuts amount to 280 people of RDA’s global workforce of 3,500.

Mary Berner, president and CEO, announced the cuts as part of a “recession plan” that also involve unpaid time off of five days each in RDA’s fiscal 2009 and 2010. The company also is suspending its contributions to the 401(k) plan.

“We hope and expect that most of these moves will be temporary and that the company will soon resume the progress it made in fiscal 2008, when we achieved success in our three-part program to launch growth initiatives, reduce costs and transform the company culture,” Berner said in a statement.
 
The company said no magazines would be closed as part of the cost cuts and that it plans to continue its plans for new launches. RDA has announced plans to launch a health title, Best Health, and DIY shelter magazine called Fresh Home, early this year.

RDA, which is under pressure to deliver results for its owner, private equity group Ripplewood Holdings, has been late to the game in cutting expenses, with most big publishing companies having already made at least one round of cuts. Flagship Reader’s Digest has been particularly hard-hit by a decline in pharma advertising; this year through the February issue, ad pages declined 12.8 percent to 125, per the Mediaweek Monitor.

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