But even though large swaths of the economy have shuttered with extraordinary speed, this economic downturn is likely to hit some people and places much harder than others. Those disparate effects, in turn, raise a question that is critical for politics as well as economics: In a country as large and diverse as the U.S., how do citizens know whether the economy is doing better or worse?
One obvious source of information is the news media. In fact, some political scientists have found that negative news coverage of the economy can shape public opinion, especially in an election year. Marc Hetherington, for instance, found that media coverage in the run-up to the 1992 presidential election was more negative than the economy warranted and cost incumbent President George H.W. Bush support. That could be particularly telling now, considering this is all happening just months ahead of a presidential election, and a strong economy has historically boosted the incumbent president’s chances of winning reelection.
But in a 2017 “Research & Politics” article, Eunji Kim, Soojong Kim and I found that the news media’s ability to influence Americans’ perceptions of the economy may be overstated. Our analysis found that major media outlets’ coverage of the economy is much more likely to lag public perceptions than to lead them. That means that the media coverage of an economic recession, like the one we seem to be headed toward, isn’t independently reshaping how Americans think the economy is doing. Instead, we found that media coverage often follows public opinion.
We used nearly 40 years of data from the University of Michigan’s surveys of consumers, a long-running survey that asks Americans their views of the economy, to create a monthly index of Americans’ level of concern about the economy.<a class="espn-footnote-link" data-footnote-id="1" href="https://fivethirtyeight.com/features/media-coverage-doesnt-actually-determine-public-opinion-on-the-economy/#fn-1" data-footnote-content="
Specifically, we looked at four questions the survey has asked consistently: 1) a question on respondents’ personal economic situation in the previous year; 2) a question on general business conditions in the previous year; 3) a question on respondents’ personal economic expectations in the coming year; 4) and a question on expectations about business conditions in the coming year.
“>1 We then compared that index to a measure of how 24 different media outlets covered the economy during that same time period, including big national newspapers like The New York Times and The Washington Post as well as regional papers like the Houston Chronicle.<a class="espn-footnote-link" data-footnote-id="2" href="https://fivethirtyeight.com/features/media-coverage-doesnt-actually-determine-public-opinion-on-the-economy/#fn-2" data-footnote-content="
The full list of media outlets is: ABC News (which owns FiveThirtyEight), the Arkansas Democrat-Gazette, the Atlanta Journal-Constitution, the Boston Globe, CBS News, the Chattanooga Times Free Press, the Chicago Sun-Times, Cleveland’s The Plain Dealer, The Columbus Dispatch, the Herald-Sun in Durham, North Carolina, the Minnesota Star Tribune, the New York Daily News, The New York Times, the Omaha World-Herald, The Oregonian, the Pittsburgh Post-Gazette, the San Diego Union-Tribune, the San Francisco Chronicle, the Seattle Post-Intelligencer, the Tampa Bay Times (known as the St. Petersburg Times through 2011), USA Today, The Virginian-Pilot, and The Washington Post.
“>2 Systematically measuring media outlets’ coverage in nearly half a million newspaper articles and television transcripts proved a bit more challenging. But similar to our approach with the economic survey data, we created an index, this time using words associated with positive or negative economies — words like “bear,” “drop,” “jobless,” and “layoff,” as well as “bull,” “growth,” and “invest”<a class="espn-footnote-link" data-footnote-id="3" href="https://fivethirtyeight.com/features/media-coverage-doesnt-actually-determine-public-opinion-on-the-economy/#fn-3" data-footnote-content="
Specifically, we created what is called an additive index, using 21 different keywords to determine both the frequency and tone of each outlet’s coverage. The resulting index tracks real-world economic indicators closely.
“>3 — to score the tone of economic stories published by these outlets.
And if we drill down into one of the most prominent media outlets we analyzed, The New York Times, we find no indication that media coverage is shaping public opinion. A telltale sign of media influence would have been if the tone of the Times’s economic coverage shifted before public perception does. But as you can see in the chart below, that didn’t really happen. Instead, the public’s perceptions of the economy more often seemed to lead news coverage rather than lag behind it. For instance, during key moments such as in the run-up to the Great Recession in 2008, the public grew more pessimistic well before the Times’s tone shifted.
In fact, this was the case across the 24 media outlets we analyzed. There were some outlets for which we found that the tone of media coverage consistently led public perceptions of the economy, but overall, we found no strong evidence that media coverage pushed Americans as a whole to perceive the economy in one way or the other.
Given how much attention politicians devote to the tone of media coverage, these results may seem surprising. But we’re actually not the only researchers to conclude that public perceptions aren’t heavily influenced by how the media frames the economy. H. Brandon Haller and Helmut Norpoth, for instance, found that citizens’ perceptions of the economy didn’t vary much based on their news consumption habits.
Still, other studies find evidence that the influence can run in both directions, with the tone of media coverage sometimes anticipating public perceptions. For example, Stuart Soroka, Dominik Stecula and Christopher Wlezien found that public perceptions can anticipate media coverage, but also that media coverage can actually lead public perceptions of how the economy has performed but not perceptions of how it will perform. After examining the tone of economic coverage in the four highest-circulation national newspapers, though, Amber Boydstun, Benjamin Highton, and Suzanna Linn conclude that media coverage can predict how Americans view the economy even after accounting for the state of the economy itself.
On two key points, then, academic research has been consistent: Public perceptions of the economy can get out ahead of media coverage, and public perceptions are also closely connected to actualeconomic conditions. This suggests that there are critical limits to the media’s influence on public perceptions, which is consistent with otherresearch thatshows the impact of elite opinion is often overstated.
In other words, when the economy shifts directions, the news media’s capacity to reshape public perceptions of the economy is limited at best. It’s easy to pick up a newspaper and assume that its writers and editors can shape public opinion, but that doesn’t seem to be true of the economy. Rather, the public reacts to real-world economic conditions, not media spin.
Staying Home Saves Lives. Could It Also Protect The Economy?
OTTAWA – Canada’s unemployment rate held steady at 6.5 per cent last month as hiring remained weak across the economy.
Statistics Canada’s labour force survey on Friday said employment rose by a modest 15,000 jobs in October.
Business, building and support services saw the largest gain in employment.
Meanwhile, finance, insurance, real estate, rental and leasing experienced the largest decline.
Many economists see weakness in the job market continuing in the short term, before the Bank of Canada’s interest rate cuts spark a rebound in economic growth next year.
Despite ongoing softness in the labour market, however, strong wage growth has raged on in Canada. Average hourly wages in October grew 4.9 per cent from a year ago, reaching $35.76.
Friday’s report also shed some light on the financial health of households.
According to the agency, 28.8 per cent of Canadians aged 15 or older were living in a household that had difficulty meeting financial needs – like food and housing – in the previous four weeks.
That was down from 33.1 per cent in October 2023 and 35.5 per cent in October 2022, but still above the 20.4 per cent figure recorded in October 2020.
People living in a rented home were more likely to report difficulty meeting financial needs, with nearly four in 10 reporting that was the case.
That compares with just under a quarter of those living in an owned home by a household member.
Immigrants were also more likely to report facing financial strain last month, with about four out of 10 immigrants who landed in the last year doing so.
That compares with about three in 10 more established immigrants and one in four of people born in Canada.
This report by The Canadian Press was first published Nov. 8, 2024.
The Canadian Institute for Health Information says health-care spending in Canada is projected to reach a new high in 2024.
The annual report released Thursday says total health spending is expected to hit $372 billion, or $9,054 per Canadian.
CIHI’s national analysis predicts expenditures will rise by 5.7 per cent in 2024, compared to 4.5 per cent in 2023 and 1.7 per cent in 2022.
This year’s health spending is estimated to represent 12.4 per cent of Canada’s gross domestic product. Excluding two years of the pandemic, it would be the highest ratio in the country’s history.
While it’s not unusual for health expenditures to outpace economic growth, the report says this could be the case for the next several years due to Canada’s growing population and its aging demographic.
Canada’s per capita spending on health care in 2022 was among the highest in the world, but still less than countries such as the United States and Sweden.
The report notes that the Canadian dental and pharmacare plans could push health-care spending even further as more people who previously couldn’t afford these services start using them.
This report by The Canadian Press was first published Nov. 7, 2024.
Canadian Press health coverage receives support through a partnership with the Canadian Medical Association. CP is solely responsible for this content.
As Canadians wake up to news that Donald Trump will return to the White House, the president-elect’s protectionist stance is casting a spotlight on what effect his second term will have on Canada-U.S. economic ties.
Some Canadian business leaders have expressed worry over Trump’s promise to introduce a universal 10 per cent tariff on all American imports.
A Canadian Chamber of Commerce report released last month suggested those tariffs would shrink the Canadian economy, resulting in around $30 billion per year in economic costs.
More than 77 per cent of Canadian exports go to the U.S.
Canada’s manufacturing sector faces the biggest risk should Trump push forward on imposing broad tariffs, said Canadian Manufacturers and Exporters president and CEO Dennis Darby. He said the sector is the “most trade-exposed” within Canada.
“It’s in the U.S.’s best interest, it’s in our best interest, but most importantly for consumers across North America, that we’re able to trade goods, materials, ingredients, as we have under the trade agreements,” Darby said in an interview.
“It’s a more complex or complicated outcome than it would have been with the Democrats, but we’ve had to deal with this before and we’re going to do our best to deal with it again.”
American economists have also warned Trump’s plan could cause inflation and possibly a recession, which could have ripple effects in Canada.
It’s consumers who will ultimately feel the burden of any inflationary effect caused by broad tariffs, said Darby.
“A tariff tends to raise costs, and it ultimately raises prices, so that’s something that we have to be prepared for,” he said.
“It could tilt production mandates. A tariff makes goods more expensive, but on the same token, it also will make inputs for the U.S. more expensive.”
A report last month by TD economist Marc Ercolao said research shows a full-scale implementation of Trump’s tariff plan could lead to a near-five per cent reduction in Canadian export volumes to the U.S. by early-2027, relative to current baseline forecasts.
Retaliation by Canada would also increase costs for domestic producers, and push import volumes lower in the process.
“Slowing import activity mitigates some of the negative net trade impact on total GDP enough to avoid a technical recession, but still produces a period of extended stagnation through 2025 and 2026,” Ercolao said.
Since the Canada-United States-Mexico Agreement came into effect in 2020, trade between Canada and the U.S. has surged by 46 per cent, according to the Toronto Region Board of Trade.
With that deal is up for review in 2026, Canadian Chamber of Commerce president and CEO Candace Laing said the Canadian government “must collaborate effectively with the Trump administration to preserve and strengthen our bilateral economic partnership.”
“With an impressive $3.6 billion in daily trade, Canada and the United States are each other’s closest international partners. The secure and efficient flow of goods and people across our border … remains essential for the economies of both countries,” she said in a statement.
“By resisting tariffs and trade barriers that will only raise prices and hurt consumers in both countries, Canada and the United States can strengthen resilient cross-border supply chains that enhance our shared economic security.”
This report by The Canadian Press was first published Nov. 6, 2024.
