Publisher wants to cut 225 jobs from Warwickshire warehouse, where books are distributed, owing to decline in demand

This article is more than 4 years old

This article is more than 4 years old

Readers’ preference for ebooks has been blamed for 225 potential job losses after publisher Penguin Random House announced cuts that leave staff facing an anxious Christmas.

The publisher of Harper Lee’s Go Set a Watchman and EL James latest 50 Shades novel, Grey, wants to cut jobs at its warehouse in Rugby, Warwickshire. It put its decision down to a fall-off in demand for physical books, which are distributed from the warehouse, and consolidation among publishers.

“The revolution in reading habits, with ebooks becoming more popular, has put these 225 jobs at risk,” said Unite regional officer Peter Coulson. “It is a worrying time for employees and their families, especially in the run-up to Christmas, and is a real blow to the local economy.”

Penguin Random House said it wants to close the distribution centre in Central Park, Rugby, by 2019, with redundancies beginning in May 2017. The company said distribution from the site would be moved to one its remaining two warehouses at Frating, near Colchester.

“Proposing to part company with colleagues is never easy,” said the publisher’s chief executive, Tom Weldon.

The company added that staff would be offered redundancy packages that were significantly higher than the statutory minimum, as well as support to help them find new jobs.

Unite is to meet managers at Penguin Random House on 15 December to discuss the business case for closing the Rugby site and whether it can be kept open.

Print sales have been in decline as ereaders such as Amazon’s Kindle and rivals Kobo and Nook prove more popular. Figures from the Publishers Association show that UK digital book sales rose 11% to £563m last year, while print copies fell 5% to £2.75bn.

Ebooks now make up 25% of the market, just eight years after the launch of the Kindle in 2007. Figures released this year by NielsenBookScan showed physical sales of adult fiction had declined by more than £150m in just five years.

But some bookshops have reported a surprise reversal in the trend, with Waterstones boss James Daunt ending Kindle sales after saying ebook revenues had “disappeared to all intents and purposes”.

The changing marketplace has led to tensions between Penguin Random House and Amazon over the price of ebooks. Overall book sales, including both formats, declined slightly in 2014, down 2% to £3.3bn.

Penguin and Random House came together in a 2013 merger agreed between their respectve owners, FTSE100-listed Pearson and German publishing group Bertelsmann.

