They got what they wanted, and it seemed like things could go back to normal, albeit with fewer deckhands on the ship.

Yet on Monday, George Arwady, the publisher of the The Star-Ledger, wrote in a memo to staff that “the revenue situation at our newspaper has worsened this year, and we expect a further significant revenue decline next year.” Now, the paper needs to cut 50 more jobs, with roughly 25 from the newsroom.

“The state of newspapers today—I’m speaking about all newspapers, not specifically our own—is that revenue is still a very serious problem,” said Donald Newhouse, the owner of Advance Publications (which owns The Star-Ledger) and the brother of Si Newhouse.

When asked if he would again consider closing the paper, Mr. Newhouse said, “No.”

“Last year we faced a specific situation in which we told our employees that if certain things did not happen, we would close the The Star-Ledger,” he said. “The things we said needed to be accomplished were accomplished.”

That’s wonderful news, but it doesn’t stop the bleeding. Can New Jersey’s largest paper sustain itself in this grim climate with such a diminished newsroom?

“We’re not the paper we were and we’re not the paper we want to be,” said Kevin Whitmer, the new editor of The Star-Ledger, who is replacing Jim Willse. “But comparatively, and when you look at online and video, there are more people seeing our content today than at any point in our history.”

This is ultimately the conundrum faced by every paper, large or small, in the country—more people are reading content online, but the eyeballs are not translating to dollars. There’s also the perception, thanks to narrower coverage, fewer stories and smaller staffs, that papers just don’t matter anymore.

“Newspapers are becoming irrelevant,” said Brendan Byrne, the former governor of New Jersey. “You don’t expect that the The Star-Ledger is going to have the kind of news it used to have.”

WHEN THIS ROUND of cuts is finished, The Star-Ledger’s staff will be half the size of what it was a year ago, but at least it will still have a bustling office. The Record, on the other hand, has existed essentially without a home base for over a year—reporters can drop into an office when they want, but they’re encouraged to stay out on the streets. Meanwhile, The New York Times killed its New Jersey section and cleared out its bureaus. The paper did assign two reporters—David Halbfinger and David Kocieniewski—to cover this season’s election, but soon their attention will be elsewhere. All The Times has left is a blog that covers three towns—Millburn, Maplewood and South Orange.

In an interview last year, Governor Jon Corzine told Off the Record that after The Times had emptied its Newark and Trenton bureaus of full-time staffers, he visited Arthur Sulzberger to express his “serious disappointment” with the decision. Mr. Sulzberger replied, effectively, tough luck—we’d love to do it, but we can’t afford it.

Meanwhile, the rest of the dailies in the state are basically enduring an endless nightmare. Gannett owns six daily newspapers in New Jersey—the Asbury Park Press, the Home News Tribune, the Courier News, the Courier-Post, the Daily Journal and the Daily Record—and the cuts have been almost seasonal: This past summer, 125 jobs were eliminated from the six papers; in December, 206 jobs were cut; last summer 55 jobs were cut; there were also more than 80 buyouts earlier in 2008. 

In total, more than 460 jobs have been lost at Gannett’s New Jersey papers in the past two years.

“I started 23 years ago at the Courier News in Bridgewater and have followed papers like that over the years as they have been folded into other papers … and you hear from friends stories like they turned off the lights in this half of the building yesterday,” said Mr. Whitmer, the Star-Ledger editor.

The fact that newspapers have cut jobs is bad enough for reporters and editors, but it’s had visible problems for a state that could use the extra policing.

“What’s going to happen in the future is what has happened already,” said Richard Codey, the State Senate president, former governor and all-around Jersey cheerleader. “Politicians will fight for the tiny piece of ink that is available. You’ve got the governor, his cabinet, mayors, legislators, congressmen fighting for space to get in the paper, and it’s almost impossible.”

“I think that New Jersey is in the precarious danger of not being capable of covering itself anymore,” said Jeff Tittel, the director of the Sierra Club in New Jersey, who is regarded as the most powerful environmentalist in the state.

Mr. Tittel used to walk through the statehouse to chat up reporters and pitch them stories; he would often plop himself on a desk to talk for hours. Now, with far fewer reporters present, he said, “either I don’t go, or I spend five minutes there.”

“A lot of the senior people who understood the issues and who had long histories are gone,” he said. “They’ve replaced them with these younger people, and when I talk to them about environmental issues or technical issues, you see that their eyes are rolling and they just don’t understand. They’ve already got two stories to do, and then they turn a complex story into a he-said, she-said with a couple quickie quotes.”

ONE OF THE most significant problems Mr. Whitmer faces is that just about anything that happens can be interpreted the wrong way. 

This past weekend, The Star-Ledger endorsed Christopher Daggett, the independent, for the governor’s race, reflecting how bored the paper had become by Jon Corzine and Chris Cristie’s mudslinging.

The only problem is that The Star-Ledger was a media partner—along with the Record and the Herald News—in a debate scheduled for this week, and they violated the rule that no newspaper could endorse a candidate prior to the event. After news of their violation of the agreement broke on PolitickerNJ.com, The Star-Ledger had to pull out of its sponsorship, and the perception among Jersey pundits has been that the place is so chaotic that even simple administrative tasks are being screwed up.

“I take responsibility for it,” said Mr. Whitmer. “I don’t think there’s anything more to it than an honest mistake.”

Despite the upcoming cuts, he is optimistic.

“You look at where those papers are now, and what their resources are, and what we’re confronted with, and comparatively we’re better positioned to absorb more cuts,” he said. “There’s not a lot of comfort in that for us, and for the fact we have to keep making cuts, but to this point, we’ve been able to maintain the basic structure of the paper and the vision of our coverage.”

He cited significant traffic gains for nj.com, the paper’s Web site, and a promise that with a post-layoff staff of about 175, New Jersey—primarily Essex, Morris, Somerset, Union and Hunterdon Counties—will continue to front the paper.

Meanwhile, the Record, with its shedding of office space in favor of more mobile reporters who report from Starbucks via their cell phones, has shown some signs of life. Last year, both the Record and its sister paper, the Herald News, saw an increase in average daily circulation by 3 percent. This year, they are expecting a very modest gain in circulation—“a few hundred copies,” said a spokeswoman.

In the past, a typical front page for the Record might have a mix of national and international stories. Now it’s all about Bergen and Passaic counties.

“We’ve been working so hard at emphasizing the local,” said Frank Scandale, the editor of the Record.

On Monday, Jon Corzine signed a bill that will give the state more oversight over public and private projects that use government dollars and cents. The bill was born from investigative pieces in the Record, which garnered a Pulitzer nomination for local reporting in 2008.

On Tuesday, the Record wrote a story about the bill signing, and The Star-Ledger used that story as well.

“The state oversight wasn’t watching it, and it was the local paper that turned over the rocks and looked at the records,” said Mr. Scandale. “This was a bad deal for the state, and people lost a lot of money. Without the Record investigating it and turning over those rocks, this wouldn’t have been discovered.”

jkoblin@observer.com