Some 3,300 media jobs lost during the first five months of May sounds like a lot, but that's actually a 90% decline from total job cuts through the same period in 2020, based on data from Challenger, Gray & Christmas, Inc. The outplacement service also reports media employers have announced 725 new hiring plans in 2021, compared to just 12 this time last year. The report is included along with other data in the latest Axios Media Trends weekly newsletter suggesting the media industry is rebounding quicker than originally anticipated.
“The anticipated collapse of the economy drove media companies to take drastic measures in the first half of last year to avoid going under. One year later, the media industry broadly is on the mend,” Axios Media Trends' Sara Fischer says. “A year ago, media companies were reeling from the early effects of COVID-19, scrambling for loans and laying off thousands while hoping to make it through a possible recession. Now, things are looking up, mostly because the economy didn't collapse.”
Axios' newsletter also cites research from advertising firm Magna forecasting a $78 billion increase in global ad spending in 2021 to an all-time high $657 billion, following a 2.5% decline in 2020. The U.S. advertising market, meanwhile, is expected to grow by $34 billion to reach $259 billion in 2021, representing its strongest growth rate in 40 years. The 2020 decline “prompted dozens of media outlets to implement sweeping layoffs and pay cuts last spring,” Fischer says. “Today, many publishers say their ad revenues have fully rebounded or even increased following last year's tumultuous turn of events.”
While these factors, along with the adoption of new digital products that have pushed media companies and newsrooms to diversify and in some cases increase revenue, Axios warns of several setbacks that will impact the industry in 2021. Among them are a slowing growth rate for publications and a drop of news site traffic since the end of Donald Trump's presidency, and continuing challenges for local newspapers as private investment firms look to consolidate local titles even further post-pandemic.