Financial news service Reuters Group PLC has announced that it will eliminate up to 20 editorial positions in the United States and Europe and hire up to 60 replacements in India in a move aimed at cost cutting.
The journalists, who will be located at a Reuters facility in Bangalore, will be responsible for compiling tables, writing short research alerts based on analyst reports and polling analysts for earnings forecasts, company spokesman Steve Naru said.
Naru said that while information produced in Bangalore will be distributed on the news wire, Reuters does not envision the journalists reporting or writing actual news stories, the Washington Post reported.
"We are of the mind that on-the-ground reporting needs to be done by reporters on the ground rather than from remote locations," he said.
The Post quoted Naru as saying that budgetary constraints were a factor in the decision, though he declined to say how much Reuters would save by eliminating jobs in higher-cost countries like the US and hiring lower paid Indian journalists instead.
The move, he said, is part of an effort by the company to expand coverage of small and mid-cap companies.
"It is all about efficiency. It is all about providing more. And it is about providing cost savings," Naru said.
Reuters employs about 500 journalists in the United States and 2,400 globally.
It has been cutting costs in recent years, said the Post, in a bid to "keep up with rival financial news service Bloomberg," The Post said.
The company was unprofitable for the first time in its 10-year history as a public firm in 2002, and it announced plans in early 2003 to cut 3,000 jobs over three years. The cost-cutting helped to bring the company back into the black last year, the daily said.
Earlier this year, Reuters had announced plans to send six journalist jobs to Bangalore. Naru said the latest hirings in India, which will occur over the coming months, represent an expansion of that pilot programme.
The Bangalore journalists will work out of a Reuters office that now employs 300 non-editorial workers who help organise market data.
Naru said the company has not yet decided which positions will be eliminated but that cuts will likely take effect over the coming year.
The Post noted that Reuters is not the only media organisaton to take advantage of the cost savings that offshore offers.
Earlier this summer, the magazine Business 2.0 outsourced reporting and editing duties for one of its issues to Indian journalists.
