Image Source: UnsplashThe high volume of available news challenges business leaders. Inflation, recession, interest rates, and White House policy are all important topics, but the day is short and the news is long. And much of the news distracts people from issues that really impact their business.Having followed economic news for decades—more closely than any business leader should—I’ve found some guidelines that help my clients stay focused on topics most important to the management of their business.Identify The Drivers Of ProfitabilityI ask my clients what matters most for their company. Perhaps sales are variable, depending on consumer spending. Or maybe sales are fairly stable but costs depend on oil prices. Credit availability makes a huge difference in some businesses but not others.These examples show external factors at work, but internal issues are also critical. How important to the business is bringing new employees up to speed? Or quickly adapting product design to technological change?With both internal and external profit drivers identified, I help connect the drivers to economic measures when appropriate.Identify Economic Indicators Relevant To ProfitabilitySuppose that your business sales are quite variable and tied to an identifiable category of buyers. The customers may be consumers buying staples based on price, or consumers with discretionary income to spend, or businesses expanding their branches. The challenge is finding the right economic measures to watch, including both recent data and forecasts. Old-timers in the industry may know what was worth watching in the past, but the business has changed along with the available data sources.Those who are not familiar with economic data can begin by scanning industry publications. Every sector has specialized publications. With as large an economy as we have, it’s natural for even a small niche to justify a print or online publication just for that sector. When reporters for such a publication reach out to me, they often ask specifically about the economic concepts relevant to that industry. Reading the trade journals is a good place to start.One can also scan general business publications, such as the Wall Street Journal, and focus on articles that seem particularly relevant to the industry. What economic concepts do they emphasize?Another approach—which turned out particularly well when I tested it—is to ask an AI tool such as ChatGPT or Claude “What economic indicators would be most useful to the CEO of a [type of business]?”A more hands-on approach would scan government data sources. Here in the United States, a great deal of sales-related data show up in the National Income and Product Accounts, including Gross Domestic Product and its components. The industrial side of the economy is covered by the Federal Reserve in its Industrial Production data release. The Fed also publishes data on interest rates and the flow of funds through the economy. Inflation is covered by the Bureau of Labor Statistics for both consumer prices and producer prices.Monitor Data RegularlyHaving identified the economic measures that relate to a particular business, the leader can monitor those indicators regularly. Monitoring means both looking at recent data as well as looking at experts’ forecasts.Most of the economic data crucial to a business can be downloaded for free from the FRED database, a service of the Federal Reserve Bank of St. Louis. FRED retrieves data from the many different government agencies, then makes it available in one convenient location.Businesses that have critical relationships with foreign entities have a more difficult challenge. If only one country is important, search for a national statistical agency. For multiple countries, the International Monetary Fund, the World Bank and the OECD maintain databases with individual country data.A simple spreadsheet can cover most of the economic data needed. Charts help the user to see whether a movement in the data is just noise or part of a significant trend.Forecasts can be bought or gleaned from some public sources. Surveys of economists’ forecasts of major indicators, such as GDP, inflation and interest rates, are available from the Federal Reserve Bank of Philadelphia, the Wall Street Journal, as well as specialized newsletters such as Blue Chip Economic Indicators. Some economists and consulting firms with an industry focus also publish their forecasts. Foreign country forecasts are available from the IMF. FocusEconomics sells compilations of forecasts by on-the-ground economists around the world.Ignore Irrelevant NewsWith the most important economic information at hand, the business leader can ignore all of the other economic news. Headlines about recession worries, television pundits talking about Federal Reserve moves, online sparring matches about the deficit—ignore it all. Just consult with your key economic indicators regularly, then relax when other economic information is broadcast. Kick back with a favorite beverage instead of fretting about irrelevant news.More By This Author:Financial Markets Have No Present Tense—Trades Are GamblesThe High-Leverage Activity CEOs Can’t Ignore: Time Management Strategy2.8% Growth Vs. 28% Recession Risk: The New Economic Landscape In 2024