In response to a $125 million budget shortfall, the Canadian Broadcasting Corp. (CBC) and Radio-Canada have announced plans to cut approximately 600 jobs, along with leaving an additional 200 vacancies unfilled.
The public broadcaster revealed on Monday that each entity will trim around 250 positions, with the remainder of the layoffs affecting corporate divisions such as technology and infrastructure. Some cuts will be immediate, while others will be implemented over the next 12 months.
These measures, according to CBC, are driven by “the same structural factors affecting all media companies,” which include escalating production costs, declining television advertising revenue, and intense competition from tech giants.
Catherine Tait, President, and CEO of CBC/Radio-Canada, acknowledged the challenges, stating, “CBC/Radio-Canada is not immune to the upheaval facing the Canadian media industry. We’ve successfully managed serious structural declines in our business for many years, but we no longer have the flexibility to do so without reductions.”
Speculation about the massive layoff have surfaced as employees reportedly prepare for a virtual meeting scheduled on Monday with Tait, aimed at addressing the “financial challenges” the public broadcaster is currently grappling with.
The broadcaster had already taken initial steps earlier in the year, reducing spending on travel, sponsorships, and marketing by over $25 million. Additionally, it postponed certain technology initiatives and limited the filling of vacant positions.
The job cuts will impact a broad spectrum of the workforce, which includes 6,500 permanent employees, approximately 2,000 temporary workers, and roughly 760 contract staff as of March.
In conjunction with the workforce reductions, CBC will trim its English and French programming budgets, including approximately $40 million in independent production commissions and program acquisitions. This move is expected to result in fewer renewals, acquisitions, new television series, episodes of existing shows, and digital original series.
“We understand how concerning this is to the people affected and to the Canadians who depend on our programs and services,” Tait said. “We will have more details in the months ahead, but we are doing everything we can to minimize the impact of these measures.”
Conservative Leader Pierre Poilievre took the development as an indication that the broadcasting firm is ill-managed, saying that the layoffs are happening after “they paid $99 million in bonuses to incompetent executives & Liberal talking heads.”
“I’ll bet none of Trudeau’s favourite mouthpieces will be let go—they’ll get more bonuses,” he added.
This development occurs against the backdrop of a broader trend in the media industry, both in Canada and globally, where news organizations have been grappling with shrinking advertising revenues amidst a significant digital shift.
Earlier this year, several media companies in Canada, such as Postmedia Network Corp., Bell Media, and Metroland Media Group, made substantial layoffs in response to economic challenges.
The timing of these CBC cuts coincides with the government’s review of the broadcaster’s mandate, with a focus on reshaping its approach to technology companies that have siphoned off a considerable portion of the country’s advertising revenues, adversely affecting news media organizations.
In the fiscal year 2022-23, CBC reported television advertising revenues of $288.6 million, with $215.5 million from TV advertising and $73.1 million from digital marketing. Overall revenue for fiscal 2023 was $515.5 million, down nearly 21 percent from the previous year when the Tokyo 2020 and Beijing 2022 Olympic Games boosted revenues.
Government funding for CBC in fiscal 2023 totaled $1.27 billion, a slight increase from $1.24 billion the year before. However, the recent federal budget has urged all departments and agencies to propose spending cuts of three percent.
Current Heritage Minister Pascale St-Onge emphasized that the final decision on CBC’s cuts has not been made yet and refuted claims that the Online News Act triggered the workforce reductions. St-Onge argued that the act, which recently led to a $100 million deal with Google to compensate journalism companies, was bringing “new revenues” into the system.
CBC has also faced challenges from social media giants, with Facebook and Instagram-owner Meta blocking Canadian users from accessing news content in recent months. The government’s indication of potentially capping the amount CBC and Radio-Canada could receive under the Google deal adds another layer of complexity to the broadcaster’s financial position.
Information for this briefing was found via CTV News and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.