Illustrated Gnome News (The Gryphon Clerks) by Mike Reeves-McMillan

They may be putting out a newspaper, but there are some things they don't want becoming news. The Illustrated Gnome News is the only newspaper serving the newly emancipated gnome community, but there are days when Ladle, the paper's overworked editor, thinks that's because nobody else is stupid enough to try to run one. She has to balance not scaring off all their advertisers with putting out a paper that stands for a better future for all gnomes. Including those gnomes who don't match up to traditional ideas of what's proper. One of these is her friend Loom, the first gnome woman to qualify as an engineer. But Loom has a secret that would shock conventional gnomes even more than that, and must somehow find a way to pursue her own happiness amidst the wider struggle to turn gnome emancipation into true freedom. (Advisory: contains non-explicit scenes of a romantic and sexual relationship between two women. The book itself is not illustrated; the title refers to the newspaper at the center of the story.)