Union-represented journalists at the San Jose Mercury News agreed to significant pay cuts last night as the newspaper industry continued to decline during the steep recession. Merc journalists voted 127-39 to ratify a contract agreement that cuts pay immediately by 7 percent, plus another 2 percent on January 1. The contract also results in higher medical-care payments, less vacation time, and lets the company put workers on unpaid furlough for up to five days next year. In addition, the deal allows MediaNews to move Merc copy editors to its consolidated copy editing facility in Walnut Creek, which also serves the Contra Costa Times and the Oakland Tribune. "This is a tough contract that will hurt a lot of our members, but it reflects the terrible situation that the news industry and the country is in," San Jose Guild President Sylvia Ulloa, who was on the bargaining committee, said in a statement. "The committee did the best we could do to limit the damage to our members, minimize the loss of jobs and to try to maintain the quality of the Mercury News." Journalists at the Trib and CC Times will be voting on their contract today.