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Pay Cut Brings Doubt About Paper's Future : Newspapers: Decision by publisher of the Oakland Tribune to reduce salaries by 11% is followed by pessimism about the 117-year-old publication's survival. If it folds, the East Bay city would be the largest in the nation without a daily.

January 06, 1991|DAN MORAIN and MARTHA GROVES | TIMES STAFF WRITERS

OAKLAND — As the Tribune's publisher imposed an 11% pay cut in a drastic move to save the newspaper, some community leaders and employees were growing more pessimistic that this city's only daily newspaper could survive.

If the 117-year-old paper folds, Oakland, with a population of 360,000, would become the largest city in the nation without its own daily newspaper.

In a "Dear Colleague" letter last week, Editor and Publisher Robert C. Maynard announced the mandatory pay cut for all employees who make more than $25,000. Maynard has been making cuts for years in an unsuccessful effort to reverse the paper's fortunes. Last year, he reduced the staff by 25%, bringing the number of employees to about 500.

But while financial problems deepen, the paper under Maynard continues to aggressively cover the foibles of city government and other public institutions.

Without the Tribune, Oakland would "become back page news" in the San Francisco Chronicle and the San Francisco Examiner, said Tim Gallen, whose public relations firm represents the major developer of Oakland's downtown urban redevelopment. "We need our own voice."

Whether the Tribune can find a formula for financial success becomes more doubtful the longer its problems remain. Union members were negotiating with Maynard on a new contract to replace the one that expired Dec. 31. But there seemed to be little chance that the unions could preserve their wage level, and Maynard says a strike would kill the newspaper.

"Basically, if the paper is struck, it will be shut down," Maynard said.

He added, however, that employees do have a choice of whether to accept the cuts--they can leave for elsewhere if they don't like it. "The choice is to go to work where they can be paid more," he said. He said he does not "have a choice" if he intends to meet his payroll.

Maynard, who took a 20% pay reduction last summer, said employees' pay cut will be reflected in their next checks. He said he hopes the resulting savings--more than $1 million during 1991--will allow the Tribune to "finance the rest of our operation"--from payroll to "tremendous deferred maintenance" in the company's aging downtown plant and fleet of trucks.

He said there will be some staff reductions in some areas of the paper, but added that the numbers will not be major.

The Tribune sells about 121,500 copies a day, making it comparable to a large suburban paper. From September, 1988, to September, 1990, the Tribune's daily circulation plunged by 18%, or about 22,000.

Maynard blames the paper's problems on labor costs and on Oakland's lack of department stores, traditionally a rich source of advertising revenue. One of the biggest advertisers, Emporium, was shut down for 10 months after the Oct. 17, 1989, earthquake. On Friday, J. C. Penney said it plans to close its only store in Oakland.

Some smaller Oakland companies would see business diminish if they had no local paper for advertising, said Ben Bagdikian, professor emeritus at UC Berkeley and former dean of the Graduate School of Journalism. That, in turn, would reduce the city's already shaky tax base.

"It would be terrible for us," said Phil Mumma, associate director of the Oakland Museum. Mumma said he believes that the museum would see its attendance, now about 500,000 a year, "soar" if it were in a media center like Los Angeles. Without the Tribune, he said, it would have a more difficult time getting the media attention that attracts visitors.

The Tribune's demise would silence a voice that has reflected this part of Northern California for more than a century. For decades the paper was owned by the late California Sen. William F. Knowland, one of the most powerful Republicans of his time, and it mirrored his views.

During that era, from the 1940s through the mid-1970s, Oakland was run by a white, conservative, Republican Establishment. Knowland, a senator for 13 years until 1958, shot and killed himself in 1974, after having attended the Tribune's 100th anniversary celebration.

Today, Oakland's population is two-thirds minority, the civic leadership is integrated, and the elected officials all are Democrats.

"As Oakland has changed and become a community with lots more ethnic diversity, the Tribune made dramatic changes," Mumma said. "It changed more as a metropolitan daily than any other daily I can think of."

With the circulation and advertising base shrinking, wages no longer can be pegged to those of the more profitable newspapers in San Francisco and San Jose. A Tribune reporter earning the top minimum wage of $700 a week will start seeing $77 less in gross weekly earnings, or $4,000 less per year.

"It's no secret that just everybody at the Tribune is working to get out," said reporter Michael Collier, who turns 34 next week and is the father of three children.

Collier, a five-year employee, said that, given the state of the Tribune and newspapers in general, he is "reassessing" his job goals.

"I don't know any person who is established who can really afford" the pay cut, he said. With children, a mortgage and other monthly bills, he said, "you can only cut so much."

Another reporter described the newsroom mood as being "very militant." Workers are tired of making concessions. At the same time, the feeling is growing that "the end seems to be at hand," he said.

Since 1983, when Maynard bought the paper from Gannett Co., the staff has agreed to pay freezes, job cuts, less favorable work schedules and reduced sick and vacation time.

Maynard has made only sporadic payments on his huge debt with Gannett, a media conglomerate that also owns USA Today. Sources said the debt, which initially was $22 million, has grown to about $26 million.

Douglas H. McCorkindale, a vice chairman of Gannett, reiterated that the company is "not calling the loan," adding: "We're doing what we can to help."

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