Journalists can talk the economy up or down

The media should exercise caution when reporting the Euro crisis, researchers warn, as the language that journalists use seems to be affecting our economic fortunes.

According to a new report from the Emphasis Research Centre, there is a strong link between consumer confidence and the use of the word ‘recovery’ in the press.

The study tracked the press’s use of the word ‘recovery’ (along with ‘green shoots’) during the recent recession and the months leading up to it. In doing so, researchers found that the use of the terms increased significantly even as the financial markets were still in freefall.   From August to November, for example, the FTSE 100 fell an enormous 24 per cent. Yet references to ‘recovery’ rose by 26 per cent in the same period.

Meanwhile, just months after recession became official in January 2009, consumer confidence began to rise – and continued to rise the more ‘recovery’ appeared in the media. Crucially, however, consumer confidence lagged slightly behind the press’s use of the word.

The researchers suggest that the language used by the press may have helped buoy consumer confidence and therefore contributed to the UK’s eventual climb out of recession. They also warn that the media itself could trigger the much-feared double-dip recession.

Rob Ashton, Chief Executive of Emphasis, says this appears to support anecdotal claims that the press can talk the economy up or down, even if they do so unwittingly. ‘It could be that merely repeating the word “recovery”, like a mantra, somehow seeped into the subconscious of both the public and the market,’ he explains. ‘This may be an example of journalists influencing the news, as well as reporting it.’

The research project began as a positive alternative to The Economist‘s ‘R-word index’, which tracks how often the word ‘recession’ appears in The New York Times and Washington Post. Over the past two decades, the index has spotted major economic turning points, such as the start of recessions in America in 1981, 1990 and 2001.

A copy of Recovery Watch is available from the Emphasis website at emphbootstrap.wpengine.com/resources/research-centre/

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Press enquiries

For more information, please call Indigo Cow, Emphasis’ PR agency, on 01273 773516 or email [email protected]

Notes for editors

1. Recovery Watch tracked the number of articles containing the words ‘recovery’ and ‘green shoots’ in the UK broadsheets between January 2008 and May 2010 against the backdrop of market activity and intervention measures. These measures include the UK Government’s stimulus package, announced in November 2008; the start of quantitative easing in March 2009; and the G20 summit leaders’ $1.1 trillion package to tackle the financial crisis in April 2009. While these other factors may have contributed to renewed faith in the future of the markets, similarities between the rise in newspaper references to recovery and the Nationwide Consumer Confidence Index appear significant.

2. Recovery Watch is the second research project published by the new Emphasis Research Centre. Launched in April 2010, the centre conducts research into language, communication and writing skills in the UK.

3. The Emphasis Research Centre is funded by Emphasis Training Ltd, which is the UK’s leading business writing training organisation.