Newspapers groan as advertisers flee, despite record readership

(CN) As the coronavirus outbreak intensified in the San Francisco Bay Area and other locations around the United States in mid-March, many editors in community newsrooms probably had a similar experience to that of Deborah Peterson, editor-in-chief of San Francisco Media Company.

The publishing company prints the San Francisco Examiner and the SF Weekly, both popular print newspapers in San Francisco — one of the wealthiest cities in the nation and the entire world.

Peterson looked at the statistics and noticed that news stories related to the raging pandemic afflicting the entire globe were getting 6,000 times the normal hits. Such an increase in readership during normal times would likely mean a windfall in advertising revenue, as the company’s salespeople could easily convince advertisers that the best way to get eyeballs on their product was by having it appear alongside some of the news website’s most popular stories.

But these aren’t normal times.

Instead, advertisers fear the nation stands on the precipice of another recession and they are therefore keeping money allocated for advertising back as they batten down their financial hatches.

“As a journalist, I know that ‘cruel irony’ is often an overused phrase,” Peterson said in a missive to the community last week. “However, it is the best one I can find to describe the situation the San Francisco Examiner and SF Weekly are facing at this moment.”

While the product is as popular and indispensable to the community as ever, the journalists who produce it, including Peterson, will have to accept reductions in hours and ultimately in pay.

“Due to the deep declines in advertising and because fewer people are in the city every day to pick up the print version of our publications, we have temporarily stopped producing SF Weekly and SF Evergreen in print,” Peterson said.

Peterson and the dedicated journalists at San Francisco Media may even be lucky compared to others in the news business. Furloughs look like a blessing to those who have been laid off, as papers slim even further or go out of business altogether.

On April 3, Cleveland Plain Dealer editor Tim Warsinskey announced he was letting go of 22 reporters, photojournalists, and other members of the editorial team at Ohio’s largest daily.

“It is devastating for each of those we had to let go, and it is the hardest thing a newspaper editor ever has to do,” Warsinskey said.

In journalistic circles, there is less sympathy for the editors wielding the hatchet than for reporters losing jobs.

“Cleveland is losing too many talented journalists,” said Henry Gomez, a national reporter for BuzzFeed who got his start at The Plain Dealer. “People in northeast Ohio deserve more from companies that have gutted newsrooms at the expense of robust local coverage.”

Gomez’s comment hits on another important element of the decline in newsroom throughout the country: citizens of cities, towns, counties and states stand to receive significantly less information about the operation of institutions that significantly affect their daily lives.

“There’s that old saying that integrity is what you have when no one else is watching, but with politicians, you always have to watch them,” said Chuck Champion, interim director of the California Newspaper Publishers Association.

Champion said the only way newspapers can pay for professional journalists to provide critical coverage of public institutions and other aspects of society is through a radical reconfiguration of the business.

“On the other side of this thing, we are going to see a newspaper industry different than the one we see today,” he said.

Champion doesn’t believe this is all bad, as San Francisco Media’s dumping of its print versions shows. Champion believes cutting expenses related to the print versions of various newspapers will cut production costs and allow organizations to pour more money into the editorial side of operations.

But in the short term, business is bad.

Gannett, the largest publisher of daily newspapers in the United States when measured by circulation data, saw its stock plummet to 63 cents on Monday, a day the rest of the market rallied.

Its stock is down nearly 90% on the year and its market capitalization is a sliver of a multibillion-dollar loan it recently took out to revitalize its operations. The company furloughed employees and has laid off some members of its newsroom as it must once again grapple with a flight of advertising dollars.

It’s not just Gannett.

San Diego Magazine announced it is folding.

The Sacramento News and Review, an alt-weekly in California’s capital that has won several awards for investigative reporting, announced it was ceasing print operations right as the pandemic increased in severity and companies began tightening advertising belts.

The Advocate, a prominent paper in the New Orleans area, is putting its staff on temporary furloughs even as the city has become ground zero for one of the worst outbreaks in the country.

Seven Days, an alt-weekly in Vermont, cut staff and Dallas publication D Magazine laid off 15 people and cut the salaries of the people who remain.

In Oregon, the problem is particularly acute.

Newspapers operating in Portland, Salem, Bend and Baker City have laid off employees or furloughed staff.

EO Media, which operates in Bend, Astoria and throughout eastern Oregon has laid off 47 people.

“We were already hurting in good times, so I don’t see these jobs coming back,” Rachel Alexander, a writer with the Salem Reporter and board president of the Society of Professional Journalists’ Oregon chapter, told The Oregonian last week.

The great tragedy of the layoffs is that they are happening at local newspapers at a time when local news is vastly more important than national news.

While The New York Times, the Wall Street Journal, The Washington Post and television networks provide copious coverage of President Donald Trump’s daily press briefings as the coronavirus continues to rage, most people need more specific information about how the disease is playing out in their communities, according to experts.

“Factual local reporting is indeed an ‘essential’ in an age of fear and misinformation,” said Ken Doctor, writing for Harvard’s Neiman Lab last week.

But for that factual local reporting to continue, the people doing the legwork need to be paid properly, particularly given the skill need and the stress endemic in the business.

“The amount of time Americans spend with journalists’ work and their willingness to pay for it have both spiked, higher than at any point since Election 2016, maybe before,” Doctor said. “But the business that has supported these journalists—shakily, on wobbly wheels—now finds the near future almost impossible to navigate.”

There are some bright spots.

More communities are seeing journalistic outlets modeled on the nonprofit structure pop up and provide critical coverage and even winning awards.

San Jose Spotlight, a nonprofit outfit covering Silicon Valley politics, won four California Newspaper Publishers Association awards Monday.

Champion, who heads the organization, said CalMatters and other such outlets are proof that journalists and journalism will not soon wind down into extinction, but must find more ways to evolve in the new information landscape.

“The industry is indispensable to democracy,” he said. “It’s indispensable to keeping our audiences aware and informed with legitimate and properly vetted information. No one else can provide the depth that we do.”