At the World Economic Forum in Davos last week, Richard Edelman released the 20th Edelman Trust Barometer, an annual public opinion poll that tracks attitudes towards government, corporations, civil society, and the media in more than 20 countries. One of the key takeaways from this year’s report is the pressing need for corporate leaders to assume a more central role in addressing key societal issues, such as global warming and rising inequality. Edelman also observed the seismic shifts occurring in the media, and especially in journalism. He noted that the rapid demise of local news is denying people critical information on vital issues, harming trust in government, and imperiling our democratic system. In this crucial area, local business leadership is urgently needed.

The economic outlook for local journalism in the U.S. is grim. Since 2004, more than 1,800 local newspapers have folded, leaving over 1,300 American communities without local news coverage. Much of this decline is the result of lost advertising revenue, which has fallen by an estimated 70% since 2006. To put it mildly, the business model for these newspapers is broken. By contrast, growth in online advertising is dramatic. Last year, for the first time, half of all advertising dollars spent globally were spent online, totaling more than $330 billion worldwide. This spending was concentrated mostly between Google and Facebook. The inevitable result of these shifts is that there are far fewer journalists, especially those reporting on local news. Nationwide, there are fewer than 38,000 people working as reporters, editors, and photographers, a decline of 47% from 2004.

This has led to hundreds of “news deserts” around the country. As Alberto Ibargüen, president of the Knight Foundation, has highlighted, “Without revenue, you can’t pay reporters. Without reporters, you can’t develop consistently reliable news reports about what’s happening in your town.” In these news deserts, residents are less likely to stay informed about local issues and less likely to vote in local elections.

Read the full Forbes article.
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Michael Posner is a Professor of Business and Society and Director of the NYU Stern Center for Business and Human Rights.