Two weeks ago, the Chancellor, George Osborne, delivered his sixth Budget speech. Last year, our #CCUKBA team used simple text analytics to look at what he said, and predict what the upcoming year could bring for the UK economy. Whilst the Chancellor used numbers to spell out his message about the economy, did his words also tell an interesting story about what was going on?
So what is text analytics?
Text analytics is a maturing technology that is beginning to deliver substantial return on investment in a growing number of application areas. Businesses can use text analytics to understand comments in context, to pull out the key concepts and make sense of what people are saying.
For example does what the Chancellor actually say in his speech reflect what actually happens in the economy? We’ve thought we would look at the number of times the word grow in its various forms has appeared in various Chancellors speeches over the last 10 years, and see whether this correlates with actual GDP growth.
Growing, growing, grown...
Last year the Chancellor mentioned grow related words 25 times. This is very slightly higher than average over the last 10 years and can be seen in context in Figure 1 below:
Figure 1 – The uses of grow related words in the speeches of Chancellors
In the last 10 years, the biggest exponent of growth was Gordon Brown, who was Chancellor until 2007. He talked about growth on average 26 times in each Budget speech. Alastair Darling, who followed him, was much more circumspect, only averaging around 19 times. George Osborne, who has been Chancellor since the 2010 election started small with only 16 mentions in his first speech, but his references to growth have been growing since then.
But what has this got to do with what actually happens in the economy?
If we look at how mentions of growth compare to actual growth, we see the following: -
Figure 2 – Comparison of grow related word usage to actual GDP growth (%) (Source: ONS)
Although it looks, from the chart, like there may be some relationship between the number of times growth is mentioned and the actual growth achieved, this relationship is not mathematically significant, and so we cannot, in this case, use how the economy does over the next 12 months to predict how often the Chancellor will speak these words next year.
Another option that we have is to use visualisation tools to try to understand what was in the text of the Chancellor’s message. One way to do this is to produce a word cloud (or tag cloud) which is a way of illustrating the key words that were used – the size of the word relates to the number of times that the word was used.
We have used WordItOut (free open-source software) to generate a word cloud for the text of last year’s budget and this is shown below: -
Figure 3 – Word cloud based on 2014 Chancellor’s speech
So what does this tell us? Some of the words are part of the necessary language that the Chancellor has to use (for example Speaker, and PC meaning percent). However some of the other words there are more interesting. Growth was used much less than might have been expected, and given that we were told that this was a budget for pensions and savers, those words do not appear quite as prominently as might be imagined. Indeed the biggest significant word that did appear was tax – so perhaps the overall message from the budget was not about growth, or even about pensions or savings, but about the fact that the Chancellor’s biggest impact on all of us was through the tax system.