Melbourne-based guidebook behemoth Lonely Planet will announce the sacking of 50 staff tonight — around 10% of its global workforce — as the global economic downturn continues to gut the tourism industry and guidebook sales.
Staff at Lonely Planet’s Footscray office were informed of the layoffs this morning with management calling a meeting this afternoon to discuss the changes and tap shoulders. A formal announcement is due at 9pm tonight to tie in with owner BBC Worldwide’s London-centric media strategy.
A spokesman for Acting CEO Stephen Palmer confirmed the cuts to Crikey this morning and said they will impact all areas of the business. Affected staff were still in the process of being informed that they were out of a job when Crikey called.
In an emailed statement, Palmer said the situation was a “difficult” one but that the company had no choice in the context of the economic downturn.
“I recognise that this is a terribly difficult time, particularly for those whose jobs will be made redundant. I would like to reiterate that I would not have taken this action if there was any way I could have avoided it.”
Palmer said the cuts were spread across the Lonely Planet’s US, UK and Australian offices and did not comment on the specific divisions affected. But sources have told Crikey that the entire online content production division has been dismantled with extra cuts to be made in support roles. The book production section is said to be immune while images staff and commissioning editors appear to have also escaped the axe.
The cuts were foreshadowed on Monday when BBC Trust chairman Sir Michael Lyons gave a speech in Cardiff indicating BBC Worldwide’s operations will be scaled back to focus on its core commercial business of repackaging the Beeb’s archive for DVD sales. UK MPs have savaged the company for the $250 million Lonely Planet purchase, claiming it has no links to its core business. The BBC is also under pressure from the UK government to use its licence fees to bail out Channel 4. BBC Worldwide made 112 million pounds last year.
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Louise Connor of the Media Entertainment and Arts Alliance said she wasn’t surprised at the decision in the context of the global tourism meltdown.
“It’s sad to see decisions made in England affecting so many jobs in Australia,” she added.
Lonely Planet staff tell of a sense of foreboding that has gripped the Footscray office over the past few months. Palmer has regularly used company-wide meetings to give frank assessments about revenue problems and website cost blowouts. Sources say that once the new website was completed, the heat was on middle management to justify ongoing staffing levels.
In October 2007, original owners Tony and Maureen Wheeler sold Lonely Planet to BBC Worldwide for around $250 million. The Wheelers retained a 25% stake and are still swimming in the proceeds of the deal, reportedly mulling plans to spend $12 million on a lavish production of Wagner’s Ring Cycle.
The latest lay-offs mirror a move taken by the Wheelers in 2004 when 40 staff were sacked and those remaining told to forgo a 3% pay rise in the midst of the SARS outbreak.
It is not known whether the 120 staff at Lonely Planet’s Oakland and London offices have been informed of the sackings.