Convinced that cutbacks were needed for the Post-Gazette to survive amid increasing media competition, unions at the 220-year-old newspaper have ratified contracts that include decreases in net pay, job reductions and changes in health care coverage.

The last unions to ratify the 39-month contracts voted yesterday.

"It's trying times for newspapers and trying times for the workers," said Teamsters union President Joe Molinero. "We have to do our best to ensure that they stay in business, so we stay in business."

The Post-Gazette has reported it lost more than $20 million last year -- a result of declines in circulation and advertising revenue, as well as high production costs and competition from the Internet. The new contracts will save more than $27 million a year, the company said.

"Achieving new labor agreements reflects an understanding by all of our employees that the newspaper industry and the Post-Gazette are changing to meet the challenges and interests of our readers, advertisers and the communities we serve," said David Beihoff, president of the Post-Gazette.

The Block family, which has owned the Post-Gazette since 1927, had threatened to sell the paper if unions did not make significant concessions.

The 14 unions had been working under the terms of five-year contracts that expired Dec. 31.

Under the new contracts, all the bargaining units at the newspaper will see wages frozen over the life of the contract, but a provision requiring employees to divert 5 percent of their wages, up to $50,000, toward health care effectively serves as a pay cut.

"It was something we had to do," said Mr. Molinero. "We have never, ever paid any portion of our health care. ... It's about time we shared in the cost of that."

The Teamsters will see a dramatic reduction in their workforce. The union, which had 375 members last year, will lose 80 positions through attrition and buyouts.

The newspaper is seeking to cut dozens of other positions or eliminate higher-paid staffers in other unions through buyouts, including 10 members of the newsroom staff.

The contract includes changes to the newspaper's health care plan and requires retirees to pay at least 25 percent of their premium payments, where they previously received health care for free.

Mike Bucsko, president of the Newspaper Guild, which represents the newsroom staff, described the contract negotiations as "horrible" and "excruciating." But in comparison to some of the concessionary contracts that are becoming the norm at big city newspapers, he said, "it's not as bad as it could have been."

Last month, for example, the Philadelphia Inquirer began laying off 71 newsroom employees, or 17 percent of its staff. The New York Times Co., which also owns The Boston Globe, is eliminating more than 700 positions company-wide through buyouts and layoffs.

"Newspapers are struggling because they have found themselves in what is a free market environment in a different way than they have been for some time," said Alex S. Jones, director of the Joan Shorenstein Center on the Press, Politics and Public Policy at Harvard University. "Often the unions have to choose between jobs and salaries -- it's a hard choice."

Declining profits at Knight-Ridder prompted the sale in June of what was then the nation's second-largest newspaper chain. The Tribune Company, which owns the Chicago Tribune and Los Angeles Times as well as other newspapers, is also considering a sale.

Partly, newspapers are struggling to make money on their Web operations, which have contributed to circulation declines by drawing readers away from the printed product through free online content.

In the period between March and September of last year, Post-Gazette daily circulation fell 8.1 percent, compared with a national average of 2.8 percent.

The new Post-Gazette contract includes provisions for the company to develop additional Web features using freelancers and contract workers, rather than union employees.

Whether the cuts will be enough for the company to regain profitability is still an open question.

"We looked at their books -- it's not a pretty picture," said Mr. Molinero. "But even with all these cuts, there's no guarantee they're going to remain profitable. If the trends continue the way they are, down the road we're going to have problems again."