merc_logo_340x60.gifThe Mercury News is laying off 101 people by the end of the year, including 40 people in the news room, or a sixth of the newspaper’s 240 news gatherers, editors and other editorial staff.

The decision, announced today, comes after a surprisingly large decline of $1.7 million in advertising over the past month, compared to the same month the year before. That’s an acceleration of the hemorrhaging. April saw a decline of $500,000 compared to the same month before.

This is a sad development, for the paper and the Silicon Valley community it covers. The Merc, our former employer, has been one of our first reads every day. With 50 layoffs a year ago, and a subsequent acquisition by MediaNews, we’d thought the bad news was over for a while. This latest took everyone by surprise; we’ve just gotten off the phone with a former colleague who said he was stunned.

Here’s a snippet from the publisher’s letter:

Dear Colleagues:

A few weeks ago, I wrote to everyone about the challenges our business faces, both over the past six years and going forward. Since then, our business outlook has worsened and we have completed our budgeting process. Given continued declines in revenue, we need to reduce expenses significantly, and thus have no alternative but to implement a reduction in
work force.

We plan on eliminating 101 positions by December 19th. The process of identifying individual employees subject to layoff is not yet complete.

Here is the Mercury News story today about the layoffs.