This is the second of a two-part post; read part one here.
IN 2004, THE NUMBER OF NEWSPAPER newsroom staff topped 71,000, according to the Bureau of Labor Statistics. Since then, it has declined by more than half. If we want to make up that loss, we’d need to add back about 41,000 newsroom staff.
But that’s not quite right. We don’t actually know precisely how many local reporters there are. The BLS “newspaper newsroom” staff data comprises national as well as local reporters, and includes some jobs, such as movie reviewers and restaurant critics, that we don’t really need to save local democracy. The data is specific to print newsrooms, so it doesn’t account for the addition of local, digital-only reporters since 2004. Nor does it account for population growth, increased government spending at the state and local levels, or the rise of misinformation engines—dynamics that, as I wrote previously, should figure into any efforts to strengthen local journalism.
Our goal should be to create a better local news system than we had in the past, including far better service for communities of color and for rural areas. To make that local news system a reality, I believe that we need to add 50,000 local reporters. (Yes, the number is rough. To see how I reached it, please read the methodology section at the end of this post.)
There is much to discuss on where those 50,000 new reporters should work, who should employ them, how those entities can be sustainable, and what kinds of journalism they should do. I’m not getting into that here. My goal is to give us a sense of the size of the financial mountain that needs to be climbed—and show that it can be done.
The median salary of a journalist is $49,000; when applied to 50,000 reporters, that salary plus benefits totals almost $3 billion. That’s how much more society should dedicate to local reporters annually. Given that the contraction of local news continues apace, this probably seems absurd. But over the past few years—and thanks to the work of numerous innovators and thinkers—the elements of a strategy have presented themselves.
Improved business models
It’s sobering to recall that the annual newspaper advertising revenue in 2020 is estimated to be $40 billion less than it was in 2000. That’s an 81 percent drop. But the old model was also pretty inefficient as a reporter-support system. In 2008, the $48 billion in total revenue only employed about $3.5 billion a year worth of journalists.
The most hopeful type of business-model improvement is the growth of digital subscriptions, which will be a far more cost-effective way of supporting journalism. And the signs so far are encouraging. True, some papers have opted to charge more for a worse product. (What could go wrong there?) But in 2020, we saw a 16 percent increase in digital subscription revenue.
CJR has covered many other efforts of commercial entities to reinvent themselves, including engaging the community through events and bringing in philanthropic funds to support labor-intensive journalism. Let’s be conservative and assume that business-model rejuvenation could generate enough revenue to support another $1 billion worth of local reporters each year.
Right now, there is probably about $100 million in philanthropic giving for local news.
Scary thought: it needs to be ten times bigger.
Comforting thought: that’s doable.
Julie Sandorf, CEO of the Revson Foundation, recently proposed “the 2 percent solution”—suggesting that if foundations spent 2 percent of their outlays on journalism, it would generate $1.5 billion. If individuals did the same, then philanthropic investments in the local news sector would total $9 billion annually. This includes small donors as well as large—though, speaking of large donors, there are now more than ten million millionaires in the United States, almost double the number in 2008. (Thank you, rising income inequality!) If each millionaire gave $1,000 to local news, that would generate $10 billion (while, admittedly, creating an undemocratic system of financing).
Not all donations need to go to nonprofit digital-native startups. They can also go to those public radio stations that seriously invest in local reporting, national programs like Report for America or the Solutions Journalism Network, hybrids that support investigative reporting at for-profit newspapers, or communities that want to “replant” a chain-owned newspaper.
We can pencil in foundations and individuals to donate $1 billion more a year. We’re up to $2 billion.
Let’s start with the core case for government support. Because the internet has offered advertisers multiple ways to reach people, many news businesses can survive only by achieving mass scale. But local news can’t scale very much; only so many people outside Tulsa will care about the Tulsa school board.
And some types of local journalism—especially local, labor-intensive accountability reporting—have never been profitable. To assume that they will be in the foreseeable future seems overly optimistic.
Much local journalism is now a public good—which, for our purposes, means it has great civic value, yet cannot be adequately supported by consumer spending. The most obvious example is local investigative journalism, which almost never pays for itself through traffic but offers enormous benefits to the community. Much local journalism falls into this category.
So we have a critical civic function that provides broad social benefits but cannot be sustained through commercial means alone. That’s a classic type of “market failure” requiring government support.
The government has always been involved in supporting the press. Sometimes this has been damaging; often, however, it has been quite positive. Among the most successful media policies is the Post Office Act of 1792, which was signed into law by President Washington and for much of our history has given lower postage rates to newspapers. In current dollars, such an act would be the equivalent of $46 billion a year in government support, according to Professor Robert McChesney. In fact, since these subsidies have declined in recent decades, we are most likely at the low ebb of government support for local news during our history.
The Rebuild Local News Coalition, a coalition of more than a dozen local news associations that I founded, created principles for sound public policy, based in part on the success of the postal subsidy. Policies, they concluded, should:
- Be content-neutral, nonpartisan, and ensure editorial independence.
- Be future-friendly, potentially helping both existing local players and innovators.
- Be platform-neutral.
- Help local news organizations develop sustainable models.
- Especially help locally grounded, diverse, or nonprofit media.
- Create more local reporter positions.
The Rebuild Local News Coalition advocated the Local Journalism Sustainability Act. One part of that bill—a payroll tax credit for hiring and retaining local journalists—was included in the Build Back Better Act, and would have provided about $350 million a year for five years, targeted toward underwriting labor costs of local journalism. That provision is dormant, though there’s a chance it could come back to life if some version of the Build Back Better legislation emerges this spring.
If the federal government also put half of its advertising dollars toward local news, that would provide another $500 million. I would love to see tax credits to help convert newspapers to community ownership. The “grand plan” of the Rebuild Local News Coalition would roughly double the number of local reports.
Anyhow, one or two of these government actions could bring us roughly another $1 billion per year—and, along with the gains through business-model improvements and philanthropy, get us to the $3 billion we need.
Ownership and Financing
These powerful movements toward rejuvenation in both the for-profit and nonprofit sectors will not succeed if we don’t also tackle problems with the ownership and financing of local news.
Half of the daily newspaper circulation is now owned by hedge funds. If Alden Global Capital’s recent efforts to acquire Lee Enterprises succeed, that figure will be even higher. What happens if Gannett, which merged with Gatehouse in 2019, defaults on its loans? We will not save local news until we confront the hedge-fund problem.
In an industry that is declining or struggling, what is the optimal ownership structure? Large chains controlled by financial institutions often approach the economics of decline in a particular way: by cutting costs and slowing—or stabilizing—the rate of revenue decline. That may, in fact, make good business sense for them. But it’s often not best for communities. To a much greater extent than before, the interests of democracy and many large media owners now diverge.
One solution is to start new, locally grounded news organizations. About 700 have been created in the past decade; you can see most of them in the membership directories of the Institute for Nonprofit News and the Local Independent Online News association. We need more of them, and we need to support them.
But there are also 6,700 existing newspapers. We need to replant some of them back into local hands. Some of this de-consolidation is happening naturally, as when Gannett sold some Missouri papers to local owners. In other cases, it’s being helped along by new groups like the National Trust for Local News (full disclosure: I’m a cofounder) that are trying to create new forms of local financing—patient capital that aspires to get local news organizations (whether they’re nonprofit or for-profit) to sustainability.
Indeed, creating new types of local financing is a key part of the puzzle. Right now the main source of financing for media is venture capital or the stock market, neither of which has any interest in providing patient capital for low-margin local news outlets. We will need help from public policy—for instance, in the form of tax incentives to local organizations that take over newspapers.
Within these four buckets, there are a number of different tactics that can get us where we need to be. If we make progress on all four, we can double the number of local reporters and save democracy.
How many local reporters are there? Notes on my methodology
In my two posts, I used data from the Bureau of Labor Statistics, as analyzed by the Pew Research Center, because it provides a consistent measure over time and enables us to see trend lines. I focused on the number for “newspaper newsroom” staff, which totaled 71,640 in 2004 and 30,820 in 2020. In one sense, that total overstates the number of local reporters because it includes national newsrooms; in another, it understates the number of local reporters because it does not include editorial staffers in local TV, radio, and digital-native newsrooms.
Using the BLS “newspaper newsroom” number as a starting point, I tried to devise a number for local news editorial staff. First, I subtracted most of those jobs that are based in New York or Washington, DC, to eliminate jobs that are probably national. That brought my number down to 24,456—a drop of roughly 20 percent. (As it happens, this is about the same number you’d get if you extrapolated decline using the daily “newspaper census” created by the American Society of Newspaper Editors, which ran from 1978 to 2015.)
Then I added local TV, radio, and digital-native news reporters. Bob Papper, a journalism researcher and professor who oversees the Radio Television Digital News Association’s annual survey, estimates 27,500 editorial staffers in TV and radio as of 2020. Determining the number of digital news staffers is hard, since most of the digital job growth has been in national players—including BuzzFeed, HuffPost, and Politico, among others. Instead, I took membership estimates from the Institute for Nonprofit News and the Local Independent Online News association, eliminated the duplicates, and ended up with about 2,100 local reporters. I then added numbers from Patch.
My calculations gave me a grand total of 56,944 local reporters. When I applied the same methodology to 2004, I calculated a total of 96,948 local reporters. All in all, it seems that the addition of 50,000 reporters, well placed, would provide what we need.
In my first post, I focused exclusively on the drop in newspaper reporters—rather than the decline in local reporters across a range of media—in order to measure the health of local news reporting. Here’s my reasoning: Local TV news programs tend to focus on a few areas—weather, traffic, sports, human interest, crime, and natural disasters. They do some great reporting on government and civic affairs, and some investigative work; still, they are often dependent on newspaper reporters to do the “extractive” reporting—i.e., finding out stuff that a powerful institution is not already publicizing. What’s more, the number of TV news reporters has remained steady—at the same time TV stations have increased the number of hours by 72 percent. So TV reporters are spread far thinner, too.
TOP IMAGE: AP Photo/Evan Vucci