A Quick Guide to Writing Business Stories

Joe Mathewson

• Publisher: Routledge
• Year: 2016
• ISBN:
  9781317518280
• Edition: 1
• Topic: Languages & Linguistics
• Subtopic: Journalism
• Index: Languages & Linguistics

Business journalism is of critical importance to society, though it may appear to some that it concerns only big business and big investors. A Quick Guide to Writing Business Stories helps students acquire the marketable writing skills required to succeed in this competitive and vibrant segment of print and online journalism. This hands-on, practical text provides step-by-step guidance on how to write business articles such as the corporate quarterly earnings story, small business profiles, and business or consumer trend stories.

Mathewson's book, based on Northwestern University's highly successful business journalism program, guides students in the use of data, documents and sophisticated expert sources. With A Quick Guide to Writing Business Stories as their resource, students will be able to write challenging stories with clarity and speed, greatly enhancing the journalist's ability to tackle stories on other complex topics, in any medium.

1  Why Business Journalism?

No other nation in history has achieved the economic success and comfortable standard of living that the United States enjoys today. Business is the essential foundation and driver of modern American life, and our future. Everyone has a stake in our nation’s business, for better or worse. Always changing, business is must coverage for responsible journalism, in all media.

Therefore, it follows that business journalism is enormously important to all of us, though it may appear to some that it concerns only big business and big investors. Not so. Two-thirds of our economy, expressed as gross domestic product, our total output of goods and services, is driven by consumer spending. So public needs and tastes, fashion and style, tech interests and uses, as well as manufacturing and mining, all are covered by business journalists.

Business Journalism Lives!

Not surprisingly, even in the midst of wrenching changes in journalism generally, business journalism is thriving. Of the dozens of journalism job openings listed every Friday by Gorkana USA, always half or more are in business journalism, print and online. The employers include Bloomberg, The Wall Street Journal, American Banker, metropolitan daily newspapers, city business weeklies like Crain’s Chicago Business and South Florida Business Journal, and specialized industry publications such as Advertising Age, The Deal, Platts, Debtwire, Institutional Investor, Insurance Networking News, Argus Media, and many others. Aggressive online news services such as Quartz and BuzzFeed are expanding their business coverage and thus their business reporting staffs. Less noticed, because their online offerings are by subscription only and cater to highly specialized (and highly demanding!) audiences, are such specialized news services as Reorg Research, in New York, which covers bankruptcy and distressed-business investing, and Tax Analysts, in suburban Washington, D.C., whose coverage speaks for itself. These business and financial reporting jobs pay better than average, because not all journalists are qualified to handle them.

So why, obscured by the decline of newspaper coverage of all kinds, is business journalism expanding? Why is there a seemingly endless demand for more and better business journalists? Who cares?

Everybody.

Casual readers of online headlines may not see themselves as consumers of business and financial news. But are they seeking a better job? A larger apartment? A deal on a used car? A good rate on a small personal loan? Maybe getting married or raising a family?

Or are they trying to cast an intelligent vote, trying to sort through the promises of the candidates about how they’ll improve job opportunities or middle-class pay? Cut taxes? Job training? Tuition assistance? Minimum wage? Crack down on Wall Street fraud?

Are these folks interested in business and financial news? Of course they are. They might not know it, but they are.

Which takes us back to the more traditional consumers of business and financial news, investors and people in business. Even this more refined audience is growing enormously. Half of American families are now invested, directly or indirectly through such vehicles as mutual funds, in the stock market. The near-doubling of working women to 70 million in recent decades has further enlarged the audience for business news.

And let’s expand the audience ever further. Think about the movers and shakers of our world, the policy makers, the thought leaders, the public intellectuals, if you will. They used to worry mostly about the Cold War and the Iron Curtain and arms control, but since the 1989–1990 upending of Communist hegemony in Eastern Europe the focus of these thoughtful people is largely economic. Economic development, trade deals, international finance, immigration pressures, monetary policy, exchange rates, and on and on. This is sophisticated stuff. As Finley Peter Dunne might have said, “it ain’t beanbag.” Who but business journalists can purport to follow this thinking, these policies, and their results—and tell the world what’s going on?

The journalists who do this important work—from consumer trends to personal finance to Big Think Economics—are a special breed. Not born, but bred.

These jobs typically require training and sometimes experience in business journalism. So how do you get your foot on the first rung of the ladder? These days, because business and finance are challenging, both to practice and to cover, it’s increasingly common that business journalists have some well-focused formal education to prepare and qualify. Most journalism schools, in both undergraduate and graduate programs, offer a course or two in business journalism, and some even offer master’s degrees in business journalism (maybe you’re reading this book as part of such a course).

The increasing complexity of business and financial affairs tells us that journalism schools should be training smart, incisive and above all skeptical business reporters. This book is designed to help that process, because credible, effective skepticism must be based on knowledge—knowledge of business and its traditional practices, standards and norms, knowledge of government regulation of business, and, especially, knowledge of how to recognize and call attention to danger. Herein, knowledge. Needless to say, this knowledge, and the skills it facilitates—whether in print, video, Web design or Internet communications—may also be employed in other forms of business or financial communications, for instance, in public relations, investor relations or other corporate communications, government financial communications, even securities analysis.

Because economic and financial understanding, whether imparted through journalism or another profession, always requires numbers, is usually detailed and complex enough to require explanation and interpretation, and demands audience time and attention for optimum comprehension, these stories are best transmitted primarily through text. Yes, they can often be enhanced, supplemented or summarized through audio, still photos, slide shows, video, social media, other websites, and undoubtedly other technological innovations yet to be invented, but until The Wall Street Journal and Bloomberg News abandon print there will be a priority need for business journalists to write, and that will be the emphasis in what follows here. As needed, a journalist accomplished in textual communication of the complexities of business, finance and the economy can readily adapt his professional skill to the less comprehensive breezy style of broadcasting, staccato style of Twitter or chunky style of the Internet.

Questions for Discussion

1  How would you define the appropriate scope of business journalism, i.e., where would you draw the outer limits and what subject area(s) would that exclude? Why?

2  Is it justifiable for business publications (and thus, the public) to rely on work by journalists who haven’t earned business degrees or actually worked in business or finance? Why or why not?

3  Do you think the business press is influential enough to help the nation avert another catastrophic boom and bust if reporting improves? If so, how?

2 Words

You’re embarking into a brave new world. Full of numbers, important and informative numbers, waiting to be discovered, assessed and communicated by you. But to handle them, let’s look first at the words, tools at your fingertips to employ usefully and precisely in presenting and characterizing the numbers.

As you familiarize yourself with the words of business journalism, think of your audience. Those men and women know a lot of the terminology of business and investing. But, as you’ll see in The Wall Street Journal and other well-written business publications, obscure or new terms should be explained, even to them. What’s the difference between familiar and new? Understandably, there’s no hard and fast rule, but your reading and your own writing will give you a considerable sense of what’s standard business language, so when a word or phrase crops up that’s unfamiliar, check investopedia.com or ask your instructor, or, if you’re still uncertain, err on the side of understanding: include an explanation, and leave it to the editor to decide whether to keep it or strike it.

The Economy

Everyone cares about the economy, at least to some degree, like your own job, for instance. When we refer to the economy, or major aspects of it, certain things come to mind:

Gross domestic product, or GDP: this is the official measure of the economy, meaning the nation’s total output of goods and services. Real GDP, which means adjusted for inflation, is about $18 trillion in 2016. Two-thirds of our GDP is consumer spending. When times are good, GDP expands. But two consecutive quarters of a contracting GDP, showing a decline in the nation’s production of goods and services, translates as recession (distinguished from the more ominous deflation, which connotes falling prices as well). The Great Recession lasted from December 2007 to June 2009. GDP is measured by the federal Bureau of Economic Analysis, part of the Department of Commerce, which terms its figure an “estimate” and subsequently publishes second and third estimates as it collects and refines more data. Nominal GDP is the GDP of a past period as reported in the dollar value of that time, i.e., without adjustment for inflation.

The U.S. national debt, ever growing, is often measured against GDP. As of 2016, the debt is about $18 trillion, roughly equal to GDP. This comparison sets off political alarm bells.

A closely watched part of GDP is industrial production, which is a measure of the total output of the nation’s factories, mines and utilities. Like some other aspects of the economy, industrial production is reported as an index, an artificial construct that, in this case, starts at 2012, or 2012 = 0. Industrial production was 107 in 2015, or 7 percent above 2012, but it’s been sliding for several decades in the face of foreign competition, and in 2015 was below its 1972–2014 average.

Closely related to industrial production is capacity utilization, showing what percentage of industrial production capabilities are actually in use. It was in the high 70s in 2015, below the 1972–2014 average of 80 percent.

An important aspect of the American economy is real estate activity, and journalists follow various indicators of its health. Housing starts is the commencement of construction of both single-family and multi-family homes, measured in numbers of housing units. New-home sales are separated from sales of existing homes, both reflecting only single-family homes, and both still recovering only fitfully from the Great Recession, which flooded the market with abandoned homes and hordes of others repossessed by mortgage lenders.

An important slice of the economy, one that journalists follow closely, is often called simply the market, as in “how’s the market?” In fact, it’s a number of markets—stocks, bonds, commodities, options, currencies, all sorts of things. But it’s the stock market that gets the most attention, and its movement up and down is most often measured by the Standard & Poor’s 500-Stock Index. (It’s the performance benchmark that professional money managers try to beat, and mostly don’t.) Other commonly reported measures of the stock market are the Dow Jones Industrial Average of just 30 “blue chip” stocks, so-called because, like blue poker chips, they’re highly valued, the NASDAQ Composite Index (predominantly technology stocks) and the Russell 2000 Index (broader than the others, including many smaller companies).

Another closely followed indicator of the economy is the unemployment rate. It moved slowly downward in the recovery from the Great Recession, from 10 percent of the workforce in late 2009 to around 5 percent in 2015, a level that’s sometimes deemed “full employment” because there’s always frictional unemployment reflecting the normal movement of people around the country, or from school to job or between jobs or whatever. Note, however, that sometimes the unemployment rate appears to be improving (dropping) when, in fact, it might be because some unemployed workers have become so discouraged that they cease looking for work, i.e., they “drop out” of the workforce. The federal Bureau of Labor Statistics (part of the Department of Labor) says that to be counted as unemployed, a person must be actively seeking work.

While we’re getting a grip on “the economy,” it’s not too soon to define the Fed. That’s short for the Federal Reserve Board, the peculiar name (given partly to obscure its purpose) for the U.S. central bank, located in Washington. It’s independent of the government. More likely in recent years, the Fed refers to the Federal Open Market Committee comprising the seven members of the Federal Reserve Board and five of the presidents of the 12 regional Federal Reserve Banks that are part of the Federal Reserve System. The president of the New York Federal Reserve Bank, by far the largest, is a permanent member of the FOMC; the others rotate in for terms of one year each. The FOMC meets periodically to consider whether it should raise or lower short-term interest rates, a policy decision that’s guided by two statutory mandates: to control inflation and to minimize unemployment.

That important interest-rate decision, traditionally implemented by the Fed’s deft purchase and...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• Introduction
• 1  Why Business Journalism?
• 2  Words
• 3  Numbers
• 4  People
• 5  The Earnings Story
• 6  Financial Services Reporting
• 7  The Corporate Finance Story
• 8  The Bankruptcy Story
• 9  The Corporate Outlook Story
• 10  The Economic Indicator Story
• 11  The Small Business Story
• 12  The Trend Story
• 13  The Consumer Story
• 14  The Derivatives Story
• 15  The Agriculture Story
• 16  The Sports Business Story
• 17  The Energy Story
• 18  The Not-for-Profit Story
• Conclusion: You’re Important!
• Works Cited
• Appendix
• Index