Although suffering from the stagnant economy, community newspapers are faring better than the rest of the industry, according to data from Suburban Newspapers of America and the National Newspaper Association. While advertising revenue for community papers in the fourth quarter of 2008 was down 6.6 percent from a year ago at US$428.7 million, this is against an industry wide decline of 21 percent for the same period, with many larger companies revealing even larger figures.

This result comes as community newspapers had less significant declines across all financial quarters last year. SNA reported declines of 2.7 percent for the first quarter of 2008 against the same quarter of 2007; a decline of 2.4 percent for the second quarter and a decline of 1.7 percent for the third for community papers. Industry wide figures for the same economic period sat at much higher levels according to NAA figures of 12.85 percent, 15.11 percent and 18.11 percent for the respective three quarters.

Furthermore, community based publications are not experiencing nearly the same amount of staff reductions. Of the hundreds of daily and weekly community newspapers participating in the survey, only half of the companies reported staff reductions. Conversely, the community papers saw growth as an important focus, with 26 percent of the the companies starting new products in 2008.

"The declines in 2008 are clearly economy-driven," SNA President Nancy Lane said in a press release. "Community papers are affected by the current economic downturn but they are not in a crisis; they are not experiencing massive layoffs and they are investing in the future."

This industry variation comes as a product of retail investment in the local market. While economy-based declines in classified advertising is impacting the community publications, these have been compensated by an increase in large retailers focusing on specific local audiences.