ABC: Overall newspaper circulation down 2.1%. Only six of the top 25 papers showed circulation increases. Over the last 30 years, U.S. population has grown by 50 million while newspaper circulation has declined by eight million.

The slowdown in the real estate market couldn’t come at a worse time. Sales of existing homes fell 8.4% between February and March, and that’s the steepest month-to-month drop in 18 years. As a result, newspaper real-estate classified revenue slipped 2.26% in Q207. Just two quarters ago, the growth rate was 10.5%.

Economists aren’t predicting things will turn around soon, which means that one of newspapers’ few advertising strongholds - real estate classifieds - is under assault for the foreseeable future. Recruitment and services advertising is already moving online in a big way. Where will newspapers find the markets that justify their traditionally huge margins? Real estate ads apparently aren’t the answer.

According to MediaPost, “McClatchy saw total classified ad revenue drop 12%, with automotive down 10%, real estate down 18.6% and job recruitment down 12.7%.” The company blamed the declines on market weakness, but Craigslist says business is just fine.

Knowledge@Wharton reports on the Washington Post’s innovative campaign to move its model online, but notes that the paper struggles with the smaller revenue and cost base of an Internet business. Registration required.