After a spate of closures and layoffs in the latter part of the last decade, the newspaper industry appeared to find its footing over the past few years. But now that oasis of stability may be drying up.

Hard times are hitting some of the most resilient titles, and the trend indicates that things are only get worse. The decline in print advertising revenue at The New York Times has accelerated from 9 percent in the first quarter of 2016 to nearly 19 percent in the most recent quarter, writes Mathew Ingram in a Fortune story ominously headlined “The New York Times Scrambles to Avoid Print Advertising Cliff.” In announcing its financial results, the paper said it expects the falloff to continue “at a rate similar to that seen in the third quarter,” or at least 19% per quarter.

The only good news in that statement is that sequential 20% declines take a smaller total dollar bite out of revenues with each iteration because the base number is smaller. But that’s the only good news. If the last three quarters are any indication, the Times advertising business is in free-fall. The paper has done a better job than anyone of growing its base of circulation revenue and increasing its digital advertising business, but both pale in comparison to the size – and profitability – of the print advertising business.

Almost in tandem with the Times’ disappointing financial results, The Wall Street Journal announced that it will consolidate sections and lay off staff as it seeks to stabilize its print business while it scrambles to grow its digital operations. Last week, the Journal laid off the staff of its “Greater New York” section and offered buyouts to 450 employees. Only 48 took the package, indicating that things could get ugly soon.

A new “Business & Finance” section will combine the Journal’s current “Business & Tech” and “Money & Investing” sections, Reuters reports. New York coverage will be reduced and moved into the main section of the newspaper.

The Journal has proved more resilient to the downturn than most print newspapers because of its pricey subscriptions and well-heeled readership. When the most optimistic statement management can make is that the paper is seeking to create a “print edition that can stand on a sound financial footing for the foreseeable future,” that doesn’t sound good.

Speaking of Reuters, the company completed this week’s morbid hat trick by announcing that it will lay off about 2,000 workers at a cost of $250 million as part of a “transformation” of its business. The silver lining – journalistically speaking – is that Reuters said none of the cuts will be in the newsroom. Instead, they will be focused in financial and technology operations that primarily serve financial services companies. Things have been tough in that business amid low interest rates and pressure from new-economy competitors. Reuters has the advantage of being a diversified company with a strong position in financial markets, but revenues are flat and there’s no indication of where additional business will come from.

The top 23 US newspapers collectively lost about 6% of daily circulation over the past six months, indicating that even the most compelling Presidential election in a generation isn’t stirring people to subscribe. Ironically, the news came the same week that the Newspaper Association of America reported that traffic to newspaper websites was up almost 16% in the third quarter. The contrast underscores the trend toward consumers turning to newspapers for information but preferring not to read in print.

The downturns were especially bad in towns like Houston, Newark, Atlanta, Philadelphia and Boston, where consumers have plenty of choices and strong media operations in nearby cities. The Washington Post and New York Times suffered the smallest percentage declines, indicating that those papers that made the leap to national circulation a few years ago are struggling less. In fact, the two biggest national dailies – USA Today and The Wall Street Journal – actually had small circulation increases.

Editor & Publisher doesn’t provide raw circulation decline numbers, but we reverse-engineered them out of the published data. Here are our estimates of total declines among the 23 papers that lost circulation:

Other than a concentration in the northeast, the most precipitous declines don’t follow any clear pattern. This is similar to the story six months ago, when the top 10 Sunday newspapers lost 635,000 circulation in one six-month period. Alan Mutter provides the historical perspective. American newspapers have lost nearly a quarter of their circulation since 1984, he says.

Layoff Log

Ugly week…

• The Orange County Register will lay off 110 people, or about 8% of its workforce, in the fourth staff cut this year and the six since 2006. Publisher Terry Horne said the reductions are part of a process to become a “different kind of company.” The company will be “more focused on Interactive and make more of an effort in the print business,” whatever that means.
• The Santa Rosa Press Democrat will lay off 16 people, 10 of them in the newsroom, in the California paper’s third headcount reduction in a year. The newsroom is now about 30% smaller than it was in 2004. The publisher said the weakening economy has cost the paper some major retail advertisers.
• The Memphis Commercial Appeal will lay off 27 workers, or about 4% of its workforce. The cuts include 11 editors.
• McGraw-Hill will cut 270 jobs, but the company’s woes apparently aren’t due to the publishing industry’s implosion as much as to the bigger implosion on Wall Street. The media and information division actually grew revenue 5%, with business-to-business publishing leading the way. It was the market data and analysis businesses that got clobbered. McGraw-Hill has trimmed 670 jobs this year.
• The Cape Cod Times will cut six newsroom jobs and will close bureaus in Falmouth, Orleans and Sandwich, MA. The paper’s owner also plans to consolidate printing operations. The reductions amount to a little less than 10 percent of the Times’s editorial staff. They include three full-time and three part-time positions.

Miscellany

The New York Times’ David Carr has an exceptionally lucid account of the troubles afflicting the newspaper industry and the implications for us all. The twist at the end is especially effective – and troubling.

Writing in Fortune, Richard Silkos is optimistic that the newspaper industry will survive and thrive, although he’s not sure in what form. Silkos sums up the caterwauling by financial analysts and dismisses it as opportunistic. In the long term, the industry outlook is better described by Disney CEO Bob Iger, who said, “It would be hard to dispute the universal appeal of a product that promised to practically deliver the news of the world to your doorstep every morning in a neatly produced, printed package.” Someone’s going to make a killing when the industry recovers, Silkos says. Just you wait.

The editor of the Echo in Suffolk, England, has been jettisoned after 32 years, and he does not go quietly into the night. David Hart uses the occasion of his farewell column to protest the proclivity of media executives to treat editors like replaceable parts. In reality, the editor is deeply ingrained into the community, Hart writes, quoting Malcolm Muggeridge: “Like a man with a white stick, tapping his way blindly through events first in order to try to guide others coming after.” Hart thanks his readers for letting him lead them through the shadows all these year, but one gets the sense he’d use the stick differently on his boss.

The Associated Press has been under mounting pressure from newspapers that object to its fee structure, and now it has a new problem: CNN. The Atlanta-based cable network is wooing editors at some major newspapers with promises of a news service that will “provide stories of interest to your newspaper and online readers — breaking news, national, international, business, politics, consumer, medical, and more.” And it’s hosting several top editors at a three-day, all-expenses-paid event in Atlanta next month to tell them more. Meanwhile, the AP is further reducing rates in a frantic effort to stave off defections.

And Finally…

“The American newspaper may be dying. But this one, the oldest college daily, isn’t going anywhere,” chirps the Yale Daily News in a stirring kickoff to its 132^nd year. It seems the president of Yale still makes time every day to speak to the campus paper and, with the university kicking off its biggest expansion in 50 years, there’s plenty to write about and plenty of eager students to read what the editors write. Booya!

Better Make That A Double; It’s Earnings Time

Today’s lead factoid: The American Society of Newspaper Editors (ASNE) says the number of U.S. newsroom journalists shrank to its lowest level since 1984 after total cutbacks of 2,900 in 2007. Update: Newsosaur Alan Mutter says this survey is a load of hooey.

In this week’s news, earnings season is upon us, and investors will be watching nervously as Media General and the New York Times Co. kick off what is likely to be a gruesome round of financial reports. Reuters says Media General revenue could fall 10.6% and lose money. The revenue slide at the times is expected to be a more modest 3.5%.

The news from Journal Register Co. could be worse than that. The floundering chain is being delisted by the New York Stock Exchange this week, which is hardly surprising given that its stock is off more than 99%. The company has hired an investment banker to explore it options. What a rapid fall from grace. Your obedient editor actually owned a few shares of this catastrophe two years ago when one of the leading money magazines called it a sleeper. Today, it looks like sleep of a permanent variety is a more likely possibility.

Alan Mutter writes that JRC was actually a model of expense management under the reign of CEO Robert Jelenic, but the disasterous acquisition of a chain of newspapers in the Detroit area saddled the company with a debt burden that may now pull it under. Some of Mutter’s stories about Jelenic’s obsession with expense reduction are amusing. What’s not amusing is the outlook: with debt at seven times trailing operating earnings and a business rooted in declining markets, it looks unlikely that JRC can successfully pull out of this tailspin.

Rate of Decline Quickens In Seattle

How bad is the newspaper business in Seattle? Despite owning a legally sanctioned near-monopoly, the Seattle Times and Seattle Post-Intelligencer have seen revenues drop more than 25% since 2000. What’s potentially worse is that online revenues are shrinking, too. No doubt the 2000 figures were bolstered by recruitment advertising revenue during the tech stock bubble, but the current year-to-year declines are outstripping industry averages. The fact that the company has made two major belt-tightening moves in just four months indicates that the shrinkage of its business is racing ahead of its own forecasts.

Crosscut Seattle publisher David Brewster has some ideas for rejuvenating the struggling Times. He advises the company to start delivering more products to people’s doorsteps, create an advertising network to sell locally on behalf of national advertisers and find a big partner, among other things.

Good And Bad News In The Numbers

This chart from eMarketer illustrates painfully the obscuring effect of percentages. Online ad sales at U.S. newspapers were up almost 19% in 2007, while print sales were down 9.4%. But the online revenue increase amounts to just $500 million, compared to a $4.4 billion drop in print sales. That means that print contracted eight times as fast as online expanded last year. This trend is ominous. In 2006, the falloff in print sales was only 1.3 times the growth in online sales.

There’s good news, though. Newspapers are doing pretty well in local advertising markets, according to Borrell Associates. Quoting from Media Post: “The survey of 3,000 local Web publishers found that newspaper sites garnered 26.9% of total local online advertising dollars, and also forecast big increases in spending for online video in particular in 2008. Overall, in 2007 newspaper Web sites netted over $2 billion in local online advertising. Thus, according to Borrell, they dwarfed online Yellow Pages sites…” The researcher says the secret is that newspapers are learning to sell better to local advertisers.

And finally…

Los Angeles Daily News Editor Ron Kaye quit 23 years after joining the paper and one month after being forced to lay off nearly 20% of his newsroom staff. “All good things in life come to an end sooner or later, even my love affair with the Daily News,” he wrote. with characteristic bluntness. Noted the E&P writeup: “During his tenure at the Daily News, Kaye became the public face of the newspaper, and his bombastic personality and scathing criticism of Los Angeles City Hall shaped the editorial pages of the paper.”

Romenesko treats us to t-shirts given out at a recent Hartford Courant awards event.