About 100 employees of LifeWay Christian Resources are losing their jobs, layoffs that executives attribute to sales not meeting expectations in an economic downturn.
In addition to cutting about 5 percent of its nationwide work force, the Nashville-based publishing arm of the Southern Baptist Convention is trimming expenses in other areas of operations, Thom S. Rainer, its chief executive, said Friday.
"We're experiencing what every other Christian publisher, retailer and conference center operator is facing," added Rob Phillips, a LifeWay spokesman. "That's just the reality of lower discretionary spending by our customers."
Most of the job cuts are in the Nashville area, where the bulk of LifeWay's 2,000 employees work — at its downtown headquarters and at a distribution center in Lebanon.
LifeWay, which publishes resource materials and operates 145 Christian retail stores nationwide, is the latest religious publisher in the area to make job cuts. In April, Nashville-based Thomas Nelson Inc. gave layoff notices to roughly 60 of its more than 600 employees as the company said it was cutting the number of titles that it publishes by half.
The layoffs come as Christian publishers are seeing a decline in sales and retailers are experiencing more competition from sales of books in secular stores and online.
Sales of religious books are down 11.4 percent for the first five months of this year compared with last year, according to Subtext, a newsletter published by Darien, Conn.-based Open Book Publishing Inc.
The declines contrast with five years ago when religious book sales grew at a 7 percent annual rate and secular bookstore chains and online retailers added to the list of titles they stocked. Between 2002 and 2007, the number of new religious titles that were published rose 54.7 percent from 12,253 to 18,956, according to book tracking firm R.R. Bowker.
But from 2006 to 2007, the number of titles declined 5 percent as publishers adjusted to lower book sales because of price increases and too many titles on the market from the earlier increases in production.
Competition increasesOn the retail side, general market booksellers such as Wal-Mart and Barnes & Noble, as well as online retailers including Amazon.com, have become a growing source of competition, adding to the challenges faced by Christian bookstore chains such as LifeWay.
In one sign of the Christian retail industry's downturn, attendance at last month's Christian Booksellers Association's International Christian Retail Show in Orlando, Fla., was down 17 percent.
"It's an indication of the economic times we live in, consolidation within the industry and people's responding to increased travel costs," said Bill Anderson, CEO of the Colorado Springs, Colo.-based trade group for Christian retailers.
But Anderson pointed out that similar events outside the Christian space also are seeing declining attendance. A major show in Atlanta for gift product retailers last month saw a more than 20 percent drop in attendance from the previous year, he said.
"It's going to remain depressed throughout this year because the economy isn't going to improve at least through October," Albert Greco, a marketing professor with Fordham University in New York, said about the tough environment for retail sales. "Christmas is going to be a key turning point. If it's not good, then it's going to get worse."
Workers will get helpLifeWay's Rainer called the layoffs a hard but necessary step to ensure continued effectiveness of the nonprofit organization's ministries. Those are supported by sales of resource materials because the organization does not get financial support from the denomination. "Although we are adjusting our priorities and scaling back some operations, we are well positioned to continue our ministry to people and churches across the nation and around the world," he said.
Spokesman Phillips said that LifeWay cut jobs over the past year but not as many as this time. Affected employees will receive severance pay, some benefits and outplacement help. Some also will be able to take advantage of retirement benefits, Rainer said.
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