Alphabet Incthat is almost in its entirety google , had 98,771 employees in December. That news, part of the 10-K annual report that the company published last week, made me think. As you might remember, google exceeded the entire American newspaper industry in advertising revenues in 2010. The figures are no longer close.
It is not a perfect comparison: advertising revenues are worldwide, not in the American newspaper industry. However, the address is correct and it is very telling. Then I asked myself if Google / alphabet I would do the same in terms of employment. The formal answer: there they go.
With 139,900 employees in December, the American newspapers remain above alphabet. The trend is clearly not preferable, and it is history's turn. Last July Mark Bergen and Josh Eidelson of Bloomberg reported that Alphabet employs approximately the same number of contractors as employees with all the benefits.
" Earlier this year, for the first time in the company's 20-year history, contractors performed better than direct employees, according to a person who saw the figures in an internal company database.".
If indeed the contractors of alphabet Outweigh the employees, the company could actually have more than 200,000 employees, much more than the American newspaper industry. Yes, the newspapers have correspondents and other contractors who also do not appear in their payroll, and the figures from alphabet they are not worldwide and those of the newspapers are not. It is not that important in comparison. But it is … disconcerting.
In the second half of the 20th century, newspapers in the United States They earned money mainly by selling ads. They used part of that money to hire journalists, but it was also enough for the owners. In 1997, the operating profit margin of American newspapers was 19.5%. The Gannet Inc. was 26.6%. These margins aroused much criticism when newspapers started to get problems in the 2000s.
I remember talking to Craig Newman from Craigslist at the time and his message was that newspaper owners would no longer have to complain about lost revenue from advertising, stop shooting journalists, and get used to profit margins. Yes, they got used to it – the operating margin of Gannet for the four quarters ended in September was 6.1%, but, as the previous graph shows, they did not stop shooting journalists.
Now they are of course google and Facebook Inc. who make a lot of money by selling ads and generating big profit margins: Alphabet / Google it achieved 22.9% in 2018, Facebook44.6%. These companies bring the public together in a more cost-effective and specialized way than newspapers have in their entire existence. In recent years they have also become major employers (Facebook reported 35,587 employees on 31 December). What they do not do, with few exceptions, is rental journalists.
This is the situation of work in the main industries that are shrinking journalists:
At first sight, labor losses seem to have stopped in 2010. But that simplistic and fast-growing category of "Publications and webcasts and web search portals", despite the fact that there are many exclusive digital journalists included, also includes for the majority of Alphabet and Facebook employees.
"All other information services", which also grow, include, well, me, in addition to libraries, archives and a few other things. The temporary employment sector, which has shrunk a little, but far less than newspapers and magazines, has many employees in the entertainment area. The film and recording industry now employs almost twice as many people as in 1990, but because they are more focused on entertainment, they did not seem to belong to the map.
A more direct, though perhaps less reliable and timely measure is the annual number of "reporters and correspondents" of the annual statistics on employment and occupation of the Bureau of Labor Statistics. In May 2017 there were approximately 38,700, compared to 53,060 in 2006. The same story in other words, with the addition that there are now probably fewer journalists and correspondents than Facebook employees.
Technological changes over the centuries have eliminated many other jobs, so it may seem selfish for a journalist to complain about the loss of journalistic jobs. It's okay, it's selfish. But journalists have a social role, one that has not yet been effectively appropriated by artificial intelligence, collective funding or other innovations.
And while there is a mix of new business models and outdated business models (mainly subscriptions) and non-profit sources, it will probably be enough to keep national journalism on an acceptable and effective scale, locally, things do not look that way encouraging.
Academics are beginning to quantify the consequences of this loss of local journalists. A study published in December by two communication professors and a political scientist concluded that the closure of local newspapers increases the chances that voters would vote for a political party in general, which increases the partial polarization.
"When they lose their local newspapers, we notice that readers turn to their political affinities to learn about their options," the authors concluded. Early last year, a survey by three financial professors revealed that municipal credit costs have increased between 0.05 and 0.11 percentage points after the closure of local newspapers, and the authors argued that "the lack of government supervision" make with the increase.
It does not seem like much, but as Danielle Moran explains, "for a debt issue of US $ 65 million, this equals about US $ 71,500 per year – enough to cover a teacher's salary – or about US $ 2 million in life. a 30-year bonus. "Google makes a lot of useful things and now has a lot of people. But usually these people do not go to city council meetings and they ask uncomfortable questions.
From Justin Fox