As layoffs rise, stock buybacks eat cash, NYT says

With the U.S. battling unemployment, big companies are dipping into record levels of cash to buy back shares -- "neglecting to lay the foundation for future growth by expanding into new businesses or building new plants,'' The New York Times says in a story today.

"It’s an extraordinarily unimaginative way to use money,” former Clinton Administration labor secretary Robert Reich told the newspaper.

After diving in the wake of the financial crisis, the NYT says, "buybacks have made a remarkable comeback in recent years, with $445 billion authorized this year, the most since 2007, when repurchases peaked at $914 billion."

Gannett is no exception, according to filings with securities regulators. It had $196 million in cash and cash equivalents at the end of the third quarter -- more than double the amount in 2007, when the economy was slipping into the Great Recession. (See table, left.)

Since doubling the dividend and announcing resumption of buybacks in July, GCI has spent $28 million on share repurchases. It said it planned to buy back up to $100 million in stock over the next 12 months.

Meanwhile, although GCI is doing limited hiring, its overall employment almost certainly continues to fall. Its last official workforce count was 32,600, at the end of last year. It was the fifth consecutive year of falling employment. The workforce last plateaued at 52,600, in 2005.