By Dan Kennedy • The press, politics, technology, culture and other passions

Economic turmoil and the Globe’s future

The tentative deal between the New York Times Co. and the Boston Newspaper Guild over wage and benefit cuts at the Boston Globe (here, here and here) comes in the midst of unprecedented economic turmoil.

Oddly enough, that may be a positive sign for the future of the Globe, because it demonstrates that the newspaper industry’s problems can’t be attributed solely to the Internet.

Take a look at today’s Globe. The state’s landmark universal-health-insurance program is being cut, and state treasurer Tim Cahill is calling for even deeper cuts. Homeless families are crowding motels. Harvard University is laying people off. The Twin Rivers casino in Rhode Island is heading for bankruptcy. (Take note, Gov. Patrick.) Housing prices continue to drop. Local merchants are hoping to rescue the bankrupt Faneuil Hall Marketplace. And on and on it goes.

In a perverse sense, though, these are all good signs for the Globe. In recent months we’ve heard a lot about the hopeless situation faced by major metropolitan newspapers. Much of their readership has moved online, but advertising hasn’t. And though charging readers for online content would surely be a boon, there are many good reasons to think people won’t pay.

But underlying the pessimism has been an unspoken assumption that current downward trends in print readership and ad revenue will continue until they converge at zero. That’s not going to happen. Somewhere there’s a stabilization point. Boston Herald publisher Pat Purcell has proven that it’s possible to get small enough to break even or earn a small profit. Surely the Globe can do the same. With a readership and ad base considerably larger than the Herald’s, the Globe also should be able to preserve most of its core mission, which is to cover the city and the region as aggressively and thoroughly as possible.

One person who should be feeling very good today is Guild president Dan Totten. As New York Times media reporter Richard Pérez-Peña reported on Monday, Totten has been criticized, rightly so, for keeping his members in the dark. And following the narrow defeat of the first deal a few weeks ago — a defeat that Totten encouraged — the phrase you most often heard about Totten was “in over his head.”

Today, though, Totten can rightfully be said to have gotten a better deal for his members. Yes, it still adds up to a $10 million giveback, and it still means the end of lifetime job guarantees for nearly 200 Guild members. But the total pay cut is lower (about 8 percent when a mandatory furlough is figured in, as opposed to about 10 percent in the first deal), which members will presumably find more palatable, even though cuts in benefits are deeper.

Neither side blinked. But Totten’s instinct that it was worth the pain of forcing management back to the bargaining table proved to be right.

Finally, the Globe’s report today includes some crucial numbers that have been missing from most of the coverage — that Globe reporters earn between $40,000 and $70,000 under the current contract. So let’s consider the impact of these various proposals on, say, a youngish reporter with a bit of experience, making $50,000.

  • Under the proposal that the Guild rejected, her salary would drop to $45,000.
  • Under the 23 percent pay cut that management unilaterally imposed after the “no” vote, she’d be making $38,500.
  • And under the 8 percent total cut now being proposed, she’d make $46,000.

The agreement will be put to a vote on July 20, and though predictions can be futile, it’s hard to imagine that it won’t pass. I also wouldn’t be surprised if there’s a deal to buy the paper very shortly thereafter.

Overall, a very good day for the Globe, for its employees and for Boston.

More: The new deal is an improvement if you think that one of the messages coming out of the “no” vote was that folks would rather take a smaller pay cut even if it meant a larger cut in benefits. I should have acknowledged that that’s likely to be a controversial proposition. The Phoenix’s Adam Reilly is soliciting comments on that very point.

Photo (cc) by blyte1 and republished here under a Creative Commons license. Some rights reserved.

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10 Comments

  1. Amused

    Two things:1. Doesn't Howie Carr look like a total fool after his "polls" and column about Globe employees with their "trust funds" rejecting a 10 percent pay cut and taking 23 percent. Looks like the cut is less than six percent 2. Maybe if the employees buy the paper they ought to make Brian Mooney the CEO.

  2. Southie

    Yes a very good day for the Globe!!! Except if you look at the advertising in the paper, a few national accounts that buy the biggest paper in the market by reflex and a couple of house ads… Now that all the barganing is over, maybe someone can leave the cushy confines of Morrisey Blvd. and actually go out and sell some local advertising. The problems at the Globe are far from over, maybe they will trade in some of those lifetime jobs for people who can actually get the job done!!!

  3. InsiderNegot

    From where I sit, it appears the Guild could have gotten this deal weeks ago. The Guild took a calculated risk that the Globe would not implement the 23% pay cut. Guild leadership let this opinion be known to many members prior to the last vote. While your assertion that neither side blinked seems correct, make no mistake that it was the implementation of the 23% paycut on its members that forced the Guild to bargain seriously.Bottom line, the Globe (NYT)gets what they wanted all along with a deal the Guild could have made weeks ago. In the meantime the Guild membership will suffer a 23% paycut until it is ratified. Even if they get some of it back after July 20, 5 or 6 weeks with 23% less pay from people who live weeks to week is painful.

  4. rozzie02131

    Insider: People who live week to week give up most of their bargaining power, period. It's not a very smart way to live. The fact that so many people, companies, and governments live like this doesn't make it any smarter.

  5. Mike Saunders

    Dan, unless you're privy to complete figures on health benefit cuts that folks inside the building won't get until tonight's meeting, it's premature to say that this is a "better deal." Will the depth of those cuts eat up any savings?

  6. Dan Kennedy

    Mike: It all adds up to $10 million. There was never any question that management was going to stick to that.Seems to me that one of the messages after the "no" vote was that folks preferred a smaller pay cut, even if it meant a larger benefit cut. We're going to find out.

  7. InsiderNegot

    Dan: Clearly that was one of the messages, but it seems the Guild could have done this the first time around, but as you say, we are going to find out.

  8. meamoeba

    as i recall the timeline, the offer that was brought to the guild was a "last, best" from the company and guild heads agreed to bring it without recommendation up or down. this deal could not have been had then because the nyt drew the line in the sand. and while some say the guild blinked with the 23 percent cut, i'd say the company did because they continued negotiating knowing or at least fearing the unilateral paycut would be shot down by the nlrb. my bet is when the no vote came down, they said "sh*t, what are we gonna do now? we have to hit them with the 23 but we'll be hung by the gonads." so they negotiated a mitigating payment to level off the cut. i still think totten's over his head but apparently nyt negotiators are in deeper.

  9. acf

    Which was the short sighted option, cutting pay more, or benefits more? Shocked by the fact that the NYT followed through on their threat and implemented the 23% pay cut, the union was forced to plead for a reopening of negotiations. After looking at a big reduction in take home pay, they were always going to pick whatever deal maximized what was in the envelope on payday. The question remains, what will the long term cost be to them in the benefits area? Are they penny wise, but pound foolish, or was it a smart deal for them?

  10. bevnews

    There's at least one major flaw in this story. The author says: "Much of their readership has moved online . . ."If that's true, Boston is the exception. In a study just reported today, it is clear that when you look at print and online usage combined, print accounts for the bulk of readership. Online appears to add about 20% to 25% unduplicated readers. Here's the link: http://netmail.verizon.net/webmail/driver?nimlet=deggetemail&fn=INBOX&page=1&degMid=96981&folderSelected=INBOX&uidValidity=null&sfield=Num&sorder=descending&reqReceipt=falseIt is true that many — perhaps most — print edition readers also use the online resource, especially for such things as checking stock prices, sports scores, etc.But to say most readers have moved online implies something that simply is not true: That they have abandoned print for online.

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