The story on the newspaper's website said other cuts included pay reductions and unpaid furloughs.
The newspaper, which is owned by the McClatchy media group, also runs other publications including the Cary News and The Herald in Smithfield. It said it would eliminate 78 positions, including 27 full time jobs in the N&O newsroom.
"We are making our way through difficult times by making difficult decisions," N&O Publisher Orage Quarles III was quoted from a memo to employees.
Last week McClatchy announced it would be trimming its costs by laying off employees and eliminating bonuses.
Click here to read more about recent McClatchy layoffs.
Eyewitness News interviewd News and Observer Managing Editor John Drescher on March 12 and he discussed the newspaper's struggle. In that interview, he admitted the paper's revenue was drying up although circulation remained strong.
