With radio advertising tanking, Philadelphia’s Entercom Communications told employees Thursday that it would eliminate or furlough “significant” numbers of employees. The nation’s No. 2 radio chain, which reaches 170 million listeners, also will temporarily cut employee pay by 10% to 20% for those earning more than $50,000.
Entercom CEO David Field said in a company memo that he would slash his salary 30%. Bonuses will be eliminated for the first half of this year and so will the company’s 401(k) match. Entercom stock, which hit a high of $16 a share in late 2016, closed Thursday at $1.30 a share, down 7.8%.
Other Philadelphia companies with executives who have announced they are either giving away their salaries to charity or cutting them include media giant Comcast Corp. and food-service provider Aramark.
On Wednesday, Aramark said it would reduce top executive salaries and directors’ fees by 25%, starting Monday.
“We are substantially reducing the compensation of our senior leadership team and some managers across our businesses. We are also placing some of our colleagues across the company on temporary furlough,” Aramark CEO John Zillmer said in a memo to employees Wednesday.
Entercom disclosed its cost-cutting actions as the federal government reported that a record 6.6 million now-jobless U.S. workers filed for unemployment benefits for the week ending March 28, as the economy grinds closer to a standstill because of the coronavirus pandemic. Pennsylvania had the second-highest total of any state in the country.
Entercom managers were informing employees on Thursday of the pay cuts. Entercom recently relocated from its Bala Cynwyd headquarters to new offices on the Schuylkill River in Philadelphia. Its Philadelphia-area stations, in addition to KYW, include WIP, B101.1 More FM and WPHT.
Hours after the Entercom announcement, two on-air hosts at Entercom radio stations in Philadelphia, Andrea Duffy at B101.1 and Casey Reed at 96.5, tweeted that their positions were eliminated.
Entercom’s stock has swooned on Wall Street with that of other radio companies. The company, which acquired the former CBS Radio operations in recent years, is making the cutbacks to preserve its financial strength. Field noted in his memo that it has “virtually no debt” to be repaid before 2024.
“We are doing everything in our power to minimize the number of layoffs through shared sacrifice across the organization, but we will still need to eliminate or furlough a significant number of positions,” Field said.
“Better days lie ahead," he added. "With the tough but necessary actions we are now taking, we are doing what is required for us to preserve the health of the company and ensure that we are strong when we get to the other side.”