The decision was "near-sighted and wrong", he said.
The Alliance said it had put a proposal to the company recommending the creation of a virtual sub-editing and production hub based in Newcastle and Wollongong.
The proposal would have enabled skilled sub-editors to remain in the community while achieving cost savings, Mr Murphy said.
In a statement, Fairfax Regional Media CEO and publisher Allan Browne said the decision to relocate the work was the best one.
"We believe the relocation of work to another business unit of Fairfax Media delivers on several fronts," the statement said.
"It reflects the Fairfax of the Future strategy of newsrooms concentrating their energy on creating content and the centralisation of secondary functions."
The jobs will be relocated to FES, an established editorial production facility within Fairfax Media.
The equivalent of 56 full-time equivalent staff will be offered redundancies across both publications. If the quota isn't reached some job losses will be compulsory, Mr Hywood said.
Newcastle Herald journalist Rosemarie Milsom said the decision was devastating.
"We are all utterly devastated," she said in an email.
Dan Proudman, chair of Newcastle Herald's house committee, said Fairfax wanted the changes in place by October.
"Their timeline is by October, when everything will be in place and... all production would be (moved) by then," Mr Proudman told AAP.
"All the mastheads will start to move over basically from today, as well as some community papers, then Wollongong by end of next month," he said.
- AAP
