task analysis meaning in education

One Step at a Time: Using Task Analyses to Teach Skills

• Published: 03 February 2017
• Volume 45 , pages 855–862, ( 2017 )

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• Melinda R. Snodgrass 1 ,
• Hedda Meadan 2 ,
• Michaelene M. Ostrosky 2 &
• W. Catherine Cheung 2  

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Task analyses are useful when teaching children how to complete tasks by breaking the tasks into small steps, particularly when children struggle to learn a skill during typical classroom instruction. We describe how to create a task analysis by identifying the steps a child needs to independently perform the task, how to assess what steps a child is able to do without adult support, and then decide how to teach the steps the child still needs to learn. Using task analyses can be the key to helping a young child become more independent.

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Conducting Task Analysis

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Snodgrass, M.R., Meadan, H., Ostrosky, M.M. et al. One Step at a Time: Using Task Analyses to Teach Skills. Early Childhood Educ J 45 , 855–862 (2017). https://doi.org/10.1007/s10643-017-0838-x

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DOI : https://doi.org/10.1007/s10643-017-0838-x

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Task Analysis: The Foundation for Successfully Teaching Life Skills

A Well Written Task Analysis Will Help Students Gain Independence

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A task analysis is a fundamental tool for teaching life skills.  It is how a specific life skill task will be introduced and taught. The choice of forward or backward chaining will depend on how the task analysis is written.

A good task analysis consists of a written list of the discrete steps required to complete a task, such as brushing teeth, mopping a floor, or setting a table. The task analysis is not meant to be given to the child but is used by the teacher and staff supporting the student in learning the task in question.

Customize Task Analysis for Student Needs

Students with strong language and cognitive skills will need fewer steps in a task analysis than a student with a more disabling condition. Students with good skills could respond to the step "Pull pants up," while a student without strong language skills may need that task broken down into steps: 1) Grasp pants on the sides at the student's knees with thumbs inside the waistband. 2) Pull the elastic out so that it will go over the student's hips. 3) Remove thumbs from waistband. 4) Adjust if necessary.

A task analysis is also helpful as well for writing an IEP goal. When stating how performance will be measured, you can write: When given a task analysis of 10 steps for sweeping the floor, Robert will complete 8 of 10 steps (80%) with two or fewer prompts per step.

A task analysis needs to be written in a way that many adults, not just teachers but parents, classroom aides , and even typical peers, can understand it. It need not be great literature, but it does need to be explicit and use terms that will easily be understood by multiple people.   

Example Task Analysis: Brushing Teeth

• Student removes toothbrush from toothbrush case
• Student turns on water and wets bristles.
• Student unscrews toothpaste and squeezes 3/4 inches of paste onto bristles.
• Student opens mouth and brushes up and down on upper teeth.
• Student rinses his teeth with water from a cup.
• Student opens mouth and brushes up and down on lower teeth.
• Student brushes the tongue vigorously with toothpaste.
• Student replaces toothpaste cap and places toothpaste and brush in toothbrush case.

Example Task Analysis: Putting on a Tee Shirt

• Student chooses a shirt from the drawer. Student checks to be sure the label is inside.
• Student lays the shirt on the bed with the front down. Students checks to see that the label is near the student.
• Student slips hands into the two sides of the shirt to the shoulders.
• Student pulls head through the collar.  
• Student slides right and then left arm through the armholes.  

Keep in mind that, prior to setting goals for the task to be completed, it is advisable to test this task analysis using the child, to see if he or she is physically able to perform each part of the task. Different students have different skills. 

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Global Cognition

What is cognitive task analysis.

by Winston Sieck updated September 20, 2021

Cognitive Task Analysis helps you unpack the thought processes of experts, so you can teach them to others.

Have you ever needed to train novices to perform well on a real-world task or job that’s complex and poorly understood?

Some of your experienced people do it well. But you don’t have a clear understanding of how they do it.

You can observe the experts’ behavior. But that only gets you so far, especially when the tasks are complex. To really understand, you need to know what’s going on inside their heads .

You need to figure out what they know and how they think. You need access to their interpretations, their goals, the ways they frame problems and decisions, as well as the thought processes they employ to work through them.

Cognitive Task Analysis (CTA) is a family of psychological research methods for uncovering and representing what people know and how they think. CTA extends traditional task analysis to tap into the mental processes that underlie observable behavior, and reveal the cognitive skills and strategies needed to effectively tackle challenging situations.

At Global Cognition, we primarily apply cognitive task analysis to inform instruction focused on higher order thinking skills. This application is similar to the use of behavioral interviews to identify competencies in human resources research. However, CTA has also been used to design human-computer interfaces and other technological systems. There are numerous ways that cognitive task analysis can help boost performance in complex work settings. For example, CTA has provided significant input into our cultural competence modeling efforts.

What does a cognitive task analysis look like?

At this point in time, it really depends on the researchers conducting the analysis. As I mentioned above, CTA represents a family of methods. And it’s not a small family. In an overview chapter on cognitive task analysis, Richard Clark of the University of Southern California and his colleagues noted that there are currently over 100 types of CTA methods in use.

Regardless of the specific technique, CTA typically consists of several broad phases that the family holds in common:

Background preparation – getting familiar with the domain and population of interest. Reading through any existing manuals, doctrine, and holding informal discussions are common ways to start getting up to speed in the problem area.

Elicitation of knowledge – using one or more specific techniques to draw out the tacit knowledge and thought processes of experts. More on this below.

Analysis of qualitative data – sifting through the mass of data, usually in the form of transcripts of the experts’ verbal reports. Identifying decisions, cues, goals, strategies, concepts, and other elements of thought.

Knowledge representation –  assembling those thought elements into a readily digestible format for understanding and communication. Usually, this means creating tables, charts, or diagrams that clearly represent the experts’ knowledge.

Design & develop applications – creating instruction, decision aids, or other applications using the newly constructed model of the experts’ knowledge as a starting point for ideation and design.

Knowledge Elicitation

To go a bit deeper into CTA methods, let’s take a look at one specific approach for eliciting knowledge, the critical decision method. First described by Beth Crandall, Gary Klein, and colleagues at Klein Associates, this is an interview technique for eliciting critical incidents to unpack the intuitive decision making of experts.

We’ll focus on this knowledge elicitation method because it distinguishes cognitive task analysis from other psychological research methods. Unlike the focus of many self-report survey methods, no one asks you to rate your opinions in a critical incident interview. And, this approach doesn’t lead you to assess your own personality, skills, or competence.

Instead, the idea of the critical decision method is to get experienced professionals to describe some of the toughest challenges they faced. By using carefully crafted probes, the CTA interviewer teases out how these people assessed situations and made decisions in critical moments of their experience.

So, how does the critical decision method work?

First, the CTA interviewer guides the subject-matter expert to identify a relevant incident. Next, the participant tells their whole story, without interruption. They are asked to recount the events in their entirety.

Then, the interviewer combs back over key points in the story several times to get the subject-matter expert to elaborate them. As they visit and revisit narrow slices of the experience, the interviewer and participant establish the critical decisions that were made, where understanding changed, and other turning points during the episode. The interviewer asks targeted questions to uncover the factors and cues noticed, goals adopted, and strategies used to resolve the incident.

Once the original story is fully fleshed out, the interviewer might ask hypothetical, “what if” questions to get a sense of anticipated outcomes that were never realized and trade-offs that were made.

Unlike the last monotonous phone survey you took, critical incident interviewers are not asking questions in lock-step fashion. Instead, they keep some flexibility to probe on aspects of a lived experience that make the most sense in the moment.

This semi-structured approach makes the critical decision method a fairly difficult interview to conduct. It takes some study and practice to learn how to execute it well. It’s also common for two interviewers to conduct the session together.

In the end, the interview produces a rich description of a critical incident and the cognition used to tackle it. In addition to observable details about the situation and behaviors, the cognitive task analysis interviewer dredges up information about the tacit knowledge, goal structures, and judgment and decision processes underlying the readily observable actions taken.

Cognitive Task Analysis for Instructional Design

These critical incidents, along with the decision points, cues, and strategies provide experience-based information that can be taught to novices.

One CTA, for example, uncovered the initial cues that experienced paramedics used to identify heart attack victims before they were fully symptomatic. These cues included changes in skin tone, the temperature of their skin, the state of their breathing and the patient’s mental state. Once they were identified, instructional materials were developed to teach new paramedics to recognize these subtle cues.

In addition to informing learning objectives, critical incidents provide a solid basis for creating informed, realistic scenario-based exercises. Along with providing a highly engaging instructional method, such exercises can expose learners to a variety of the tough situations they may encounter, and clue them in to the difficult decisions they’ll have to make. Further, they enable learners to practice the higher order thinking skills they’ll need to successfully work through challenging problems.

In all, using an expert’s knowledge, skills, procedures, and methods, locked inside incidents they have experienced, to design training materials can yield better decision-making processes for everyone.

Image Credit: johnhain

Clark, R., Feldon, D., Van Merrienboer, J. J. G., Yates, K., & Early, S. (2008). Cognitive task analysis. Handbook of Research on Educational Communications and Technology . 577-593.

Hoffman, R. R., Crandall, B., & Shadbolt, N. (1998). Use of the critical decision method to elicit expert knowledge: A case study in the methodology of cognitive task analysis. Human factors , 40 (2), 254-276.

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Task Analysis in Special Education: How to Deconstruct a Task

• September 15, 2022 April 11, 2024

As educators, we often go through the process of deconstructing a task by breaking down a complex skill into smaller steps so that students are able to learn the skill gradually, and easily. This process is known as Task Analysis and is especially crucial when teaching students with special needs.

We typically learn in two ways, explicitly and implicitly. Explicit learning is the intentional experience of acquiring a skill or knowledge, while implicit learning is the process of learning without conscious and deliberate awareness, such as learning how to talk and eat. Our students with special needs benefit more from explicit teaching and learning because they often face challenges acquiring skills implicitly due to the need for contextual understanding, communication skills, and so on. 

For explicit teaching and learning to be effective, it is important to have a thorough understanding of the skill through task analysis.

Task Analysis involves a series of thought processes:

1. Goal Selection: Know exactly what it is that you want to teach

Be clear and specific about the goal or the skill that you want to teach. Avoid having too many sub-goals. 

• Negative example: Play a complete song.
• Positive example: Press keys on the piano by following the alphabets shown on a flashcard or music score.

2. Identify any prerequisite skills, if any 

In our earlier example of teaching the sequence of piano keys, some of the prerequisite skills will include:

• Literacy skills of alphabets and/or colours
• Matching skills of alphabets and/or colours
• Visual referencing skills in top-down and/or left-right motion
• Motor skill of only using one finger to press the key, or to imitate an action

Prerequisite skills are important because these skills help to make the learning more feasible and increase the possibility of successfully performing the new skill. 

3. Write a list of all the steps needed to complete the skill you want to teach

A skill can be completed in a single step, or in a series of sequential steps. It is thus helpful that we list down all the steps needed to complete the skill we want to teach. With this, the Task Analysis becomes more detailed and effective. Let’s take the above goal and list down the steps needed. 

Goal: Press keys on the piano by following the alphabets shown on a flashcard or music score.

The keys steps needed to complete this task are:

• Look up at the flashed alphabet.
• Process and retain the information in the learner’s working memory.
• Look down at the piano keys.
• Find the corresponding key by scanning past non-target keys.
• Identify and stop at the target key.
• Aim and press with one finger. 

4. Identify which steps your child can do and which he/she cannot yet do

The next step will be to know the current skill level of your learner by identifying which steps the learner can do, and which the learner cannot. Assume the learner has the following challenges:

• Not consistent in visual referencing skill of looking up and down repeatedly.
• Unable to focus and scan more than 4 keys at one time.
• Often mistakes Letter G for C and vice versa. 

This means that this learner will have challenges in completing Steps 3, 4, and 5 in the above Task Analysis. 

5. Isolate any gap skills, if needed, and teach them first

The steps in which the learner cannot do or has challenges in are known as gap skills . After identifying the gap skills, take time to isolate the skills, teach them, and bridge them. This process takes time. For example, looking at the gap skills in the above example: 

• Visual Referencing Skill: 

This is an abstract skill that takes time to build. It is unlikely that the learner can learn and master this in a couple of weeks. Therefore, to bridge this, the teacher should intentionally provide opportunities for top-down visual referencing across activities and settings, such as taking a toy from a shelf above and keeping them back on top, or sorting activities whereby one item is on top, and one is at the bottom. 

• Working Memory Stamina

This is also another skill that takes time to build. Teaching it across settings and activities will be more effective and efficient. 

This is a skill that can be taught together with the target skill. Since the learner mistakes G for C and vice versa, and is unable to scan more than 4 keys at any one time, reduce the sequencing to CDEF or FGAB such that there is only either C or G in the target sequence. Once the learner is more confident, isolate C and G so that the learner learns to differentiate the two before the full sequence is introduced again. 

Once the gap skills are bridged, the likelihood of the learner performing the target skill will increase vastly.

6. Determine the strategy to be used when completing the target skill, with or without gap skills

At this stage, the learner might still have some gap skills to work on, but the teacher decides to move on to teaching the actual target skill. There are generally three strategies to use:

• Backward Chaining

As the name suggests, Backward Chaining involves the teacher helping the student complete all the steps in the front, leaving only the last step for the learner to do. This also means that the teacher focuses on the last step in the teaching process. The teacher then slowly moves to teach the step before the last until the learner is able to complete all the steps.

• Forward Chaining

This is the opposite of Backward Chaining. The teacher starts teaching from the first step and then moves on chronologically. 

• Total Chaining

This strategy involves the learner in all the steps and the teacher teaches all the steps to the learner with prompts. The learner is learning all the steps. 

It is common to have tried all three strategies before the teacher is able to decide which one works best, so do not be afraid to evaluate and change your mind halfway!

7. Develop a systematic teaching plan, implement, assess and evaluate the progress

After you decide on your teaching strategy, you can then plan and start the actual teaching. Do remember to assess and evaluate the learner’s progress regularly so as to make the learning effective!

Task Analysis may be a long and daunting process at the beginning. However, the more you do it, the better you get at it. In fact, we are practising the steps of Task Analysis as we write this article for you! Practice more and you will soon see how useful it is. 

Interested in more tips on teaching to children with special needs? You can read about the importance and features of a good classroom set-up here !

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EDI Activates 18 of the Top 30 Influences on Student Achievement, As Measured by Hattie

John Hattie, a professor of education from Australia and New Zealand, published Visible Learning in 2009 (with additional books in 2012 and 2015).  The purpose of his research was to identify what works and what doesn’t in education in statistical terms.  It was a groundbreaking analysis because, for the first time, educational methods could be compared in terms of effectiveness.  The Times Educational Supplement called Hattie’s research “the holy grail of education.”

In reviewing Hattie’s descriptions of educational influences, Dataworks has found that Explicit Direct Instruction (EDI), which was developed by Hollingsworth and Ybarra as a collection of research-based teaching strategies for design and delivery of lessons, actually activates 18 of top 30 effects (out of 195 total). That means the EDI approach to education is a useful system for making learning visible, according to Hattie’s research.

Effect Size

Hattie analyzed 900+ meta-studies of educational programs and procedures, and came up with an “effect size” for each of 195 “influences” on learning (138 in 2009 and 150 in 2012).  The range is from 0 to 1.62, with the larger effect being more valuable. Hattie found that .40 was the “hinge point” of usefulness.

Hattie said, “There is no fixed recipe for ensuring that teaching has the maximum possible effect on student learning, and no set of principles apply to all learning for all students. But there are practices that we know are effective and many practices that we know are not.” He concluded that if teachers are using practices that have a less than .40 effect, then it “may mean that teachers need to modify or dramatically change their theories of action.”

Visible Learning and Teaching

Hattie says “visible teaching and learning occurs when there is deliberate practice aimed at attaining mastery of the goal, when there is feedback given and sought, and when there are active, passionate, and engaging people (teacher, students, peers) participating in the act of learning.”  Mansell (2008) describes this “holy grail” of education as “improvement in the level of interaction between pupils and teachers.”

Implications for Schools

Furthermore, Sebastian Waack from Edkimo, who writes the Visible Learning blog, says Hattie’s research has two main implications for teachers and schools.  “ First, teachers are the central aspect of successful learning in schools. Second, Hattie’s results suggest that school reform should concentrate on what is going on in the classroom and not on structural reforms.” This supports the EDI mission of focusing on instructional excellence in the classroom.

Following are the specific ways that EDI correlates with Hattie’s top influences on learning. The effect size and year of publication are noted in the text for each influence .

Summary of How EDI Uses Top Effects of Hattie Research

Details of how edi uses top effects of hattie research, author:  mike neer.

Mike has served as editor and curriculum researcher for DataWORKS since 2010. Previously, he taught English in middle school, high schools, and colleges in Illinois, Puerto Rico, and California. He has edited national trade magazines and presented seminars nationwide for businesses and non-profit organizations. He believes words are a powerful educational tool for reporting, reflecting, and revealing.

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"Learning never exhausts the mind" Leonardo da Vinci

Why is task analysis important in teaching and learning?

1. Make a list of skill and knowledge (my previous article on Skill Hierarchy will be helpful) 2. Select the learning objective (learning objective will give you insight on the S/K) 3. Based on the S/K start to identify types of activity 4. Make a list of activity based on S/K 5. Organize the activity (in other words, “write a lesson plan”) 6. Based on the lesson plan draw a task analysis diagram

Image source: In Zahari Hamidon (2018). Online learning – Instructional strategy matters [Keynote Speaker] on 10 September 2018. Learning Resources Festival. International Medical University (IMU), Bukit Jalil Campus. 9-11 September 2018.

Through task analysis, you will be able to deliver the S/K effectively which will give impact to the learning outcomes.

Szidon, K., & Franzone, E. (2010). Task Analysis: Online Training Module. (Madison, WI: National Professional Development Center on Autism Spectrum Disorders, Waisman Center, University of Wisconsin). In Ohio Center for Autism and Low Incidence (OCALI), Autism Internet Modules , http://www.autisminternetmodules.org . Columbus, OH: OCALI.

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What is Task Analysis in Teaching?

• November 2022
• Task Boxes , Academics , Life Skills

What is Task Analysis?

Task analysis in teaching means the process of breaking down a skill into smaller, more manageable components . It's a great way to teach students in special education (especially with Autism Syndrome Disorder) a skill that may be too challenging to teach all at once.

When Should I Use Task Analysis in Special Education?

A lot of people tend to get mixed up between Discrete Trial Training (DTT) and task analysis. They can be similar but there are some major differences between DTT and task Analysis . (LINK the blog Kristina wrote that compares them) I typically like to use more of a task analysis for teaching certain life skills to my students that may be overwhelming. I use DTT as more of an Applied Behavior Analysis Approach.

Why is Task Analysis Important?

Using task analysis in teaching is important because it allows opportunities to teach our students a more challenging skill . The more challenging and functional skills that they can do, the more independent they can be! This is why using a task analysis approach in teaching is so important in special education!

What are Some Examples of Task Analysis?

A great example of a task analysis in teaching would be breaking down a life skill that some of our kids may find more difficult, such as brushing their teeth, washing hands or making a sandwich into smaller steps.

For example, when teaching students to brush their teeth , you teach them that it is an 11 step process:

• Get out toothbrush.
• Get out toothpaste.
• Open toothpaste lid.
• Squeeze a small amount of toothpaste on toothbrush.
• Brush your top teeth while counting in your head to 30.
• Brush your bottom teeth while counting in your head to 30.
• Spit out toothpaste into sink.
• Rinse toothbrush under running water.
• Rinse your mouth with a cup of water.
• Wipe your mouth with a towel.
• Put toothbrush and toothpaste away.

I would have these steps typed up on a sheet of paper for them to follow while in the bathroom (with visuals also). For some students, you may even want them to check off each step as they complete it to make sure that they don't miss anything. The more that they repeat this routine process, the more natural and less challenging the skill becomes for them. I hope this helps you better understand what a task analysis is.

CHECK OUT THESE LIFE SKILLS TASK BOXES FOR MORE IDEAS!

I am a High School, self-contained Autism teacher from Central New York, who is passionate about individualizing student learning. I am a mommy of three, lover of all things Disney, married to my best friend and addicted to chocolate!! I hope that you find great ideas and inspiration here, so welcome!!

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Task Analysis in Special Education: Break Down Complex Tasks into Managable Chunks to Aid Students with Disabilities

• Categories : Teaching students with learning disabilities
• Tags : Special ed information for teachers & parents

What is Task Analysis?

Task analysis is a process by which a task is broken down into its component parts. Everyone uses task analysis at some point, even if it is unconsciously. How else would anyone learn to complete processes? As the adage goes, you have to walk before you can run. It is easy to forget that some tasks need to be broken down into chunks, because after a time, they become like second nature to us. We often expect students to be able to figure out the steps involved in completing a task. But with a special needs population, where you might have children with processing disorders or difficulty with organization, it’s necessary to take the time to express the different parts of a task until the student has mastered each one.

Consider telling a student to put his coat on to go home at the end of the day. It seems self-explanatory. Yet when you think about it, there are several steps involved. Where is the coat? If the student isn’t already holding it, he has to go to a location to retrieve it. Once that is accomplished, how does he put on the coat? He could just stick his arms in, but then it would be backwards. He could lay it on the floor, stick both arms in upside down and then flip it overhead, but that in itself is three steps. He could put one arm in and then send the coat around his back until he finds the other sleeve to put his arm into – three more steps. Finally, should he just leave the coat hanging open? Is there a zipper, snaps or buttons? Working any of those fasteners requires several operations. So, the simple instruction of putting on a coat to go home is not as simple as it may have initially seemed.

How Does Task Analysis Work?

Like any other undertaking, Task Analysis can also be deconstructed into steps:

• Determine what task you want the student to perform
• Figure out what steps will be required to complete the task.
• Teach the student one step until the student displays mastery of it.
• Decide what order to teach the steps in. You might have the student master the last step,then second to last and so on until the entire task can be done independently. Or vice versa, you can work from the first step to the last. This is known as chaining.
• As each part of the process is learned, add it to the chain until the task can be completed independently.

Task Analysis can be an invaluable tool for a special educator trying to help students gain independence. Whether the students have cognitive, physical or communication impairments, they can benefit from this process.

Task analysis in education and evaluation: an application among midwives in the Republic of Yemen

• PMID: 8057954
• DOI: 10.1016/s0266-6138(05)80251-7

The political union between the countries of North and South Yemen prompted nurse-midwife educators to re-examine the midwifery curricula of both countries and define the roles midwives play as members of the health team, based on the unique circumstance in which Yemeni midwives operate within the health care system. The faculty of the Health and Manpower Institute (HMI), the main educational institution for the education of midwives, recognised that the delineation of tasks attributed to the practice of midwifery varied widely within Yemen, and between Yemen and other countries, despite the existing international definition of the role. In 1992, the Agency for International Development (AID) funded a workshop for the HMI faculty. Nineteen midwives, nurses and other health care professionals used task analysis techniques to define key knowledge, skills and attitudes that a midwife should be taught in Yemen. Task analysis, a psychometric (test development) technique, is a process that can be used to develop specific role delineations. This article describes in detail the process of task analysis in identifying key skills, knowledge and attitudes to be taught to student midwives in Yemen, clarifying the role of midwives and identifying the usefulness of a derived task listing in educational development and student evaluations.

PIP: With the political union of North and South Yemen, Health and Manpower Institute (HMI) faculty noted a need to define tasks related to the practice of midwifery since these tasks differed greatly within Yemen and between Yemen and other countries. In 1992, USAID provided funds to the Family Health Training Project to put on a 3 day workshop in basic evaluation skills for 19 midwife teachers, nurses, and X-ray technicians. The workshop facilitators had the participants use the process of task analysis to define key knowledge, skills, and attitudes that a midwife should learn in Yemen. Task analysis is a psychometric (test development) technique. The steps of task analysis are data collection, development of a comprehensive document of the tasks, and evaluation of the task document. When task analysis is used as an evaluation methodology, the first step is making a detailed list of expected competencies (i.e., task statements) which are used to guide curriculum development. Program managers can use norm-referenced evaluation methods (i.e., comparing the pefformance of 1 midwife student or practitioner to that of others in the same or similar group) and/or criterion-referenced evaluation methods (i.e., an expected and predetermined standard of competent performance). The task statements can also be used for practicing midwives to perform self-assessment of their competency. The task list can also be used in more global evaluation strategies (e.g., licensure exams). HMI faculty learned and used task analysis during the workshop to identify core clinical competencies and to set goals and objectives (e.g., competency checklist aimed to improve midwifery instruction and improve quality of care). At the end of the workshop, the 2 groups built a consensus and finalized a Performance Assessment Instrument. Faculty members of midwifery schools throughout Yemen have field tested the instrument for validity.

• Curriculum*
• Health Knowledge, Attitudes, Practice*
• Nurse Midwives / education*
• Practice Patterns, Physicians'*
• Task Performance and Analysis*

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PESTLE Analysis

Insights and resources on business analysis tools

PEST Analysis: Examples and Meaning in Business

Last Updated: Apr 8, 2024 by Jim Makos Filed Under: PEST Analysis

What is a PEST analysis, and what are its four parts? What is the difference between PESTLE analysis and PEST, and why is it important for every business? As a business student, analyst, manager or owner, you are called to conduct a PEST analysis sooner or later. In the next 10 minutes, I’ll go through everything you need to know about PEST analysis and how you can do a PEST analysis of an organization starting from scratch. I promise you’ll know more about PEST analysis than 99% of people out there, as I’m explaining everything as concisely as possible. Let’s start with the PEST analysis definition.

What is a PEST Analysis?

PEST analysis is a strategic tool for organizations to identify and assess how Political, Economic, Social, and Technological external factors impact operations so that they can gain a competitive edge. A PEST analysis helps you determine how these factors will affect a business’s performance and strategy in the long term. It is often used in collaboration with other analytical business tools. For example:

• A combination of PEST and SWOT analysis usually gives a clearer understanding of a situation with related internal and external factors
• PESTLE analysis is an extension of PEST analysis that covers legal and environmental factors

I’m going to explain the PEST analysis as simply as possible with examples and a template for better understanding. I will also show how to do a PEST analysis starting from scratch, even for people without any business education like me!

Why Do a PEST Analysis

It’s simple: to succeed. For a business to be successful, they need a few things:

• A solid product
• Marketing plan
• Identifiable brand
• Happy customers
• Thorough budget
• An investor or two
• Unique selling position
• And a whole lot of research

Throughout the endless market research, customer acquisition costs, and project risk assessments, business managers could forget about outside influences ( we call these external factors in this type of analysis). Aside from the company’s internal resources and industry factors, PEST’s macroeconomic factors can impact a company’s performance in a big way.

By being aware of external factors, managers can aid their business. But if they don’t know them, they can cripple their business before it begins. That’s how advantageous PEST analysis is .

What are the four parts of PEST analysis?

Now, let me explain each of the four parts of a PEST analysis more thoroughly. You’ll better understand what each of these external factors in this analysis is all about.

• Political – Here, government regulations and legal factors are assessed in terms of their ability to affect the business environment and trade markets. The main issues addressed in this section include political stability, tax guidelines, trade regulations, safety regulations, and employment laws.
• Economic – Next, businesses examine the economic issues that have an impact on the company. This would include factors like inflation, interest rates, economic growth, the unemployment rate and policies, and the business cycle followed in the country.
• Social – At this stage, businesses focus on the society and people. Elements like customer demographics, cultural limitations, lifestyle attitudes, and education come into play here. This part allows a business to understand how consumer needs are shaped.
• Technological – This may come as a surprise, but technology may not always be an ally for businesses. Depending on the product, technology may affect the organization positively but also negatively. In PEST’s last section we find technological advancements, the role of the Internet, and how an industry’s innovation creates winners and losers.

Every business is different. Some factors may not affect a firm or industry as they would with others. But it’s beneficial to have a well-rounded view of the many factors that could affect them. Along with the ones that will affect them.

This is why we do PEST analysis for a business — to be aware of risks, opportunities, influences, and limitations. Let’s go deeper into these external factors that impact the success of a business. I’ll also briefly mention a specific example for each of them.

Political Factors

Political factors in PEST analysis refer to the extent to which the government and political actions in a country influence the business climate. Here are some examples that will occasionally make it into the (P) of my PEST analysis:

• Tax policies
• Tax incentives
• Political tensions
• Employment laws
• Import restrictions
• Health and safety laws
• Consumer protection laws
• Tariff and Trade restrictions
• Regulation and deregulation

For instance, a country’s foreign policy often plays an important role in determining trade regulations. This can either result in trade restrictions or trade incentives and can affect an organization’s operations. Read my dedicated page on political factors with more examples here .

Economic Factors

In the (E) part of PEST Analysis, we run into how the economy affects the organization. I consider the following economic factors when doing a PEST analysis:

• Interest rate
• Inflation rates
• Exchange rates
• Unemployment rate

For instance, exchange rates affect a global organization by influencing the cost of imported and exported goods. Furthermore, interest rates influence the cost of capital available to the organization. Thus they are significant in the expansion and growth of a business. Find more economic factors and examples of how they affect businesses here .

Social Factors

Social factors include different cultural and demographic aspects of society. These can affect the macro-environment in which the organization operates.

In the ‘S’ part of the PEST analysis I usually examine:

• Age distribution
• Cultural diversity
• Demographics shifts
• Population growth rate
• Health consciousness and trends
• Changing consumer lifestyles and preferences

A study of these factors can help organizations understand the dynamics of existing and emerging potential markets along with future customer needs.

Social factors are more unpredictable than economic and political factors, simply because people are unpredictable. But every business needs customers. And what and how they buy has an immediate effect on an organization’s profitability.

Based on these social factors, marketers create buyer personas. These avatars are necessary for businesses to target the ideal customer.

For example, if you’re selling whey powder, you go after fitness enthusiasts and bodybuilders. You are looking for people that follow an active lifestyle. Hence, a declining trend in health consciousness doesn’t seem encouraging.

That’s the tip of the iceberg. Learn more about social factors here .

Technological Factors

Technological factors aren’t important only for tech-related businesses. The (T) part in PEST analysis may affect even the most old-school organization that’s been operating for a century.

Technology is evolving at a rapid pace and consumers are becoming extremely tech-savvy. With the advent of new technology, older technology gets outdated and obsolete. If an organization does not look out for technological changes, it can lag behind its competitors.

I often include the following technological factors when conducting a PEST analysis:

• Cybersecurity Threats
• Emerging Technologies
• Big data and computing
• AI and Machine Learning
• Supply Chain Automation

Let’s consider the advancements in computing; more specifically, networking.

If a business offers the latest and fastest Wi-Fi in their store, it’s an added luxury. It’s annoying if it still operates on 3G speeds, but won’t ruin sales. However, if they handle all receipts in an online database and that goes offline because they didn’t keep their network infrastucture up-to-date then they have a major problem. Especially in big holidays like Black Friday.

Again, this is about impact on the business operation. How will ‘X’ technology affect the business in the long and short term? That’s what we’re trying to figure out with PEST analysis.

A ton more technological factors can be found here .

PEST Analysis Examples

Here is a hypothetical PEST analysis example that can give you a clear understanding of how this works:

Here at PESTLEanalysis.com I rarely limit myself to PEST analysis. I almost always go the extra mile and include the Legal and Environmental factors when I initiate a PEST analysis. This leads to a more detailed analysis called PESTLE.

PESTLE Analysis: An extension of PEST Analysis

PESTLE analysis is an extension of PEST that is used to assess two additional macroeconomic factors. These factors are the  Legal and Environmental conditions that can have an impact on a organization. Examples of PESTLE analysis are similar to those of a PEST analysis, but they will include factors such as these:

• Discrimination laws
• Copyright and patent laws

Environment:

• Waste management
• Changes in weather and climate
• Laws regarding pollution and recycling
• Use of green or eco-friendly products and practices

So, if you want to assess a business situation comprehensively, a PESTLE analysis is a definite must. You can find more about that analysis here .

Why PEST Analysis Is Important For Every Business

So, now that we did a PEST analysis, how’s that going to help the business?

What does a five-year business plan look like? Or a ten-year plan? It likely involves growth.

Whether it’s the expansion of a product line or opening stores in new locations, business changes need proper preparation. And that’s where the PEST analysis comes in.

PEST analysis is the foolproof plan for business expansion !

Both new business owners and veterans should include PEST analysis in their business plan. By breaking down the critical influences in the P.E.S.T. categories, businesses get a better understanding of whether their next business move is strategic or doesn’t make sense.

For example, politics isn’t just about political tensions, unrest and elections. Politics are also about trade policies, regulations and taxation. Companies doing business worldwide have to consider laws in the countries they operate, as well. Even if they aren’t doing international trade yet, it could be a possibility in the future, and going in blind is a good way to toss success out the window.

PEST analysis helps people become aware.

Aware of how political parties and regulations can impact a business. And how the economy (past, present, and future) affects an industry. It allows people to understand consumers — who they are, what they buy, and why they don’t buy. And finally, it identifies what technology is necessary for the development and success of a product, business, or industry.

It’s almost like an outline. It shows people what influences impact the quality, success, or devastation of businesses and industries. You can’t stop the four influences, but if you’re aware of them and their impact, you can plan around, against, or with them.

PEST analysis is often used by business analysts, marketers, students, and business owners, since it’s super important for every business!

All you need to do a proper PEST analysis is time. And the payoff is worth every second.

How PEST analysis works

PEST analysis requires research and data, sometimes ten years old, sometimes only a couple. The more information I have to go through, the more accurate my final results will be. By looking into the past and the present, I can make predictions for the future.

By studying these recent developments through a PEST analysis lens, organizations are deciding whether to jump into this for the long haul or for the time being.

You want to look at your industry in a similar light. Ten years ago, did it exist? Has it slowed down within the last two years or are more companies diving in? More competition can be a strong sign an industry is booming, but it could also be the first sign of oversaturation.

Break down your assessment into the four categories of PEST analysis. Start with politics and work your way through the remaining factors. Or start from the bottom. Whatever gets the job done and makes the analysis enjoyable.

How to Do a PEST Analysis From Scratch

I’ve written dozens of PEST analyses over the last couple of years. Below I document my process on how to do a PEST analysis , even when you’ve never written one before.

You should have a topic in mind. Most PEST analyses are about a specific business, industry, or product. However, they can also be applied to countries, too. You can’t start without a topic, though, so have it ready.

Where to find information for your PEST analysis

It’ll be easier to find and segment information if you break your analysis down into four sections, like the acronym implies:

• Technological

Each section will require its own information. However, some of this information will overlap.

For instance, the economy is often closely tied to political (in)stability. And the state of the economy always affects consumers (social). You don’t need to look for these patterns specifically— it’ll become apparent as you discover new information.

Start with the history

You should be familiar with your topic. If you’re not, read about its history. Learn how it was established, how long it has been around, and who founded it. Read about any major achievements on the organization in question over the last few years. Jot down notes whenever something that seems relevant or important pops up.

After this informational primer, it’s time to start on the four sections. I do my PEST analysis in order of the acronym because the information often bleeds into the next section.

Finding Political Information

Political information is easier to find than in other sections of the analysis (social and technological, specifically). Here, you’ll want to investigate the current political climate.

For instance, if the organization originates from America, you’ll research the current political parties. Who is in charge? Has this affected business operations in any way?

If your topic (business, product, industry) was established years ago, what was the political climate like then? Are different parties in power now? If this is the case, then you’ll want to compare how things have changed for your topic from then to now.

This is also the section where you’ll look into laws and regulations affecting business. Remember the list we went through in the beginning.

I find this information with a simple Google search. Such as “tariff laws USA” (plug in the country you’re searching for if it’s not the United States).

It’s best to get this information from a government site. These sites end in .gov. You may also find information from organizations (websites ending in .org) but not all of these sites are legitimate organizations. Be wary while you research.

Honestly, most of the information you’ll find is dense. But it’s easier if you have a goal. Look for signs of:

• Government (in)stability
• Possible political corruption
• New bills/regulations that may impact your topic
• Any issues your topic has had with current/former regulations or political parties

If your topic is a company, finding the right information may be easier. Search for “company name + political issues” or “company name + policies” and see what comes up. Avoid any information from untrustworthy sites and sites with no legitimate source.

Finding Economic Information

While you’re researching political information, you may come across connections to the current economy. For instance, political instability often leads to economic instability. This causes unemployment rates to rise and employee strikes. This affects how much disposable income people have.

You may have already found information in your political section that confirms economic problems. But if you haven’t, search government sites for current tax rates, interest rates (if your topic involves international business), and the current state of the economy. Is it good? Thriving? Or bad and declining?

Again, use government websites. Search for economic statistics over the last few years. If your topic is an industry, see how many companies (startups) have started within the last few years.

If your topic is a business that has international stores, look into the relationship between the country of origin and each country the company does business. If the relationship is good, it’s often a good outlook for the company. But if it’s bad, it may lead to problems. What problems? Do a bit of digging online.

Also, if your PEST analysis is for a company, you may look into stocks . Have they been declining? On the rise? Because if it’s the former, then the business may not be looking good. And you’ll want to find out why .

If my topic is a business, I sometimes check out the competition. I’ll look into how that other company has been fairing economically, specifically how its sales have risen or fallen over the last couple of years. If it’s dropped products, shifted marketing efforts, etc., I want to know why . A competitor analysis isn’t always necessary , but it can shed light on possible problems your topic may face.

Finding Social Information

This section is a bit trickier. Political and economic sectors rely heavily on data and evidence. You can find this information on government websites. News sites too, even. And although you can find databases about demographics and population growth for this section — all applicable in a PEST analysis — I wouldn’t stop there.

In the social section, I often examine how consumers are impacted by political and economic factors. You can draw conclusions based on the information you’ve already gathered from your political and economic segments.

For instance, if there is political instability and the economy is on the fritz, then consumers may feel uneasy. They may have fewer job options. And that means they’re less likely to spend frivolously. If your topic is a luxury product, it may mean the company that makes it may have lower sales this year.

But you also want to learn about how consumers feel about your topic. If it’s a company, do consumers generally like it? Or is public opinion souring? There should be a reason for why.

Consider Facebook. The company’s CEO, Mark Zuckerberg, has consistently been in hot water over the years. If not for data breaches affecting millions of users, but for their shady involvement with fake news and political tampering.

This has led many consumers to shy away from using Facebook. And this affects businesses that use Facebook to reach new customers.

In this section of the PEST analysis, I’m more likely to search for my topic on news sites and publications. The more popular the topic, the easier it’ll be to find articles written about it. But if the topic has ever been in the news, you’ll likely find it online.

Websites to search include :

• Consumer Reports
• Local news websites
• Other reputable sources

If you know your topic has been in the news for something bad, you can search the topic + the problem.

Although the information may overlap, take keynotes here. See how the problem is affecting consumer opinion. You may even want to take a look at the comments (if there are any) and see what people are saying. It’s coming straight from the lion’s mouth (consumers).

I think many PEST analyses favor numbers too much. We live in a world where anyone with an opinion can be heard, thanks to the internet. And enough of those voices can cause a business to change its policies and products. It can even cause the company to collapse.

So it’s important to search for how consumers feel about your topic too.

Finding Technological Information

This section of the PEST analysis is a bit abstract as well. You’re looking into how new technological advancements has affected your topic positively or negatively. You should also look into what technology your topic uses (currently). And what technology they may want to incorporate.

You may want to look at competitors if your topic is a product or business. See what others are using. And think about why they are.

Press releases

It may be beneficial to search for press releases involving your topic, if possible. If your company is using new technology, they may have announced it through a press release. You can search “company name + press release” or search through these press release websites:

• PR NewsWire
• NPR: National Public Radio

You may also find other information here for the other sections of the PEST analysis. Which is just an overall bonus. If all else fails, check if your topic has a website (unless it’s an industry or country). Discuss how they use social media (if they don’t, then… discuss that too!). In this section, you’re assessing what your topic uses, what it doesn’t, and why.

Putting it all together in a final PEST analysis

You’ll likely have heaps of information at hand. For some it’ll feel like too much — but that’s never the case for a PEST analysis. As you begin to read through each section’s notes, incorporate the most interesting, pressing, or surprising information. If anything overlaps with other sections, include that too.

I write each section of a PEST analysis at a time. I take my notes and create coherent sentences. Sometimes I make a list of the most important points and include them that way. If the section is long, I’ll use subheadings to break up the information.

Work on each section separately. And then if there are overlapping themes, incorporate those in. You may want to use those at the end of each section to connect to the next.

Once you’ve done this, you’ve completed your PEST analysis! Most of the work is in finding the information and making it coherent. The last 10-20 percent is putting it all together. So, once the research phase is done, you’re basically done too!

Understanding PEST Analysis: Taking Action

In conclusion, developing an understanding of what is PEST analysis becomes even more important when a company is about to launch a new business or a new product. In general, when they are about to change something drastically. That’s when all these factors play an important role in determining the feasibility and profitability of the new venture.

Therefore, developing an understanding of PEST analysis is useful for organizations for analyzing and understanding the ground realities of the environment they have to operate in.

Realizing what is PEST and knowing how to take this analysis into consideration, the organization can be in a better position to analyze the challenges, environment, factors, opportunities, restrictions and incentives it faces. In case an organization fails to take into account any one of these factors, it may fail to plan and operate properly.

But don’t PEST analysis stop you. Here are some variations that may come in handy when assessing how the external environment affects an organization:

• STEEP Analysis
• STEEPLED Analysis
• SWOT Analysis

Protesters Are Calling on Universities to Divest from Israel. Here’s What That Means

W hen Victoria Hinckley, a 21-year-old student organizer at the University of South Florida, participated in a pro-Palestinian protest Tuesday evening, she says the night ended with tear gas and rubber bullets used by police against the activists. (The school denies that rubber bullets were used.)

“It makes me really disappointed, but more than anything, it really, really makes me angry to see this sort of response,” says Hinckley, who says she was suspended later that evening over email. The college senior, however, remains adamant in one of her demands that led her to protest that night: for her university to divest funds from Israel.  

Hinckley is one of thousands of students choosing to participate in encampments or sit-ins across more than 100 colleges throughout the U.S. The protests are framed as an act of solidarity with the more than 34,000 Gazans who have died , according to the Hamas-run Gaza health ministry, following Hamas’ kidnapping of more than 200 hostages and killing of 1,200 Israelis on Oct. 7. 

Divestment from Israel is one of the demands echoed by student demonstrators nationwide. At several colleges, students have erected tents on campus grounds as they rally for their cause, calling on universities to sell off investments from Israeli companies and those with ties to Israel, such as Lockheed Martin, Boeing, Alphabet, and Amazon. About 100 U.S. colleges have reported gifts or contracts from Israel totaling $375 million over the past two decades, according to a Department of Education database .

“Divest all of Columbia’s finances, including the endowment, from companies and institutions that profit from Israeli apartheid, genocide and occupation in Palestine,” the Columbia University Apartheid Divest group wrote in its list of five demands , which also include an academic boycott and ending campus policing. “Ensure accountability by increasing transparency around financial investments.”

What are the students calling for? 

While the demands across universities vary, students are generally asking their schools to both disclose their investment profiles and commit to divesting from any business that profits from, or has a relationship with, Israel. 

“We think we should have a right to see where our own tuition money is going and have a say in what our tuition money is going towards,” says Hinckley. 

At least one of the corporations Hinckley names, and alleges her school has current investments in, is listed on the Boycott, Divestment, Sanctions (BDS) movement website , which calls for the withdrawal of support of companies that they say support Israel or otherwise “engage in violation of Palestinian human rights.” The University of South Florida tells TIME in a statement that the school has maintained a “consistent position” on divestment for more than a decade and will not divest. “We have made this position clear many times. USF’s investments are guided by its mission, fiduciary responsibilities and state and federal laws. USF does not select individual stocks or companies for investment.”

But students elsewhere are also asking for divestment from tech companies like Google, which provides cloud computing services to Israeli troops, and has been subject to sit-ins by its own workers, prompting dozens to get fired. Other student protesters have also invoked Amazon, which has a joint contract with the Israeli government and military. 

At Yale University, students are advocating for divestment from military weapons manufacturing. The university previously prohibited investment in assault weapon retailers that facilitate sales to the general public. But in April, Yale’s Advisory Committee on Investor Responsibility announced that divestment from military weapons manufacturing did not meet their criteria for divestment “because this manufacturing supports socially necessary uses, such as law enforcement and national security.” 

How do college endowments and investments work? 

The calls for universities to divest from companies profiting from the Israel-Hamas conflict has put a spotlight on the intricate workings of university endowments and the practical implications of divesting. 

University endowments serve as the financial backbone of educational institutions, comprising vast sums of assets that can be used to support future investments and are managed to ensure long-term sustainability. Endowment figures at major universities can soar into the billions, with Columbia University’s endowment sitting at $13.6 billion in 2023. At Harvard, the endowment hovers around $50 billion.

These endowments—which are entrusted to boards of trustees—aren’t just money sitting idle, but rather actively managed investments cultivated to generate returns that help support the institution’s mission.

“Endowments are basically the university version of a 401(k),” says Chris Marsicano, who researches higher education finance and is an assistant professor of education studies at Davidson College. “There’s a bundle of different investments and the goal is to earn enough money in revenue over the next couple of years such that you can take some of that revenue and put it into your operating funds.”

Investment managers typically select companies for endowment portfolios that demonstrate strong financial performance, though many institutions also consider environmental, social, and governance (ESG) criteria into their investment process, screening companies based on their ethical practices.

What would divesting from Israel mean in practice? 

While the concept of divestment from Israel appears straightforward—selling off shares of companies with ties to the country—its practical implications are far more complex.

Divesting from Israel would mean universities reassessing their investment portfolios to identify and potentially divest from companies implicated in Israel’s war effort, such as supporting Israeli settlements in occupied territories or supplying equipment used in military operations. Some experts in the financials of higher education say that divesting could be a lengthy and complicated process, since most universities hold diversified portfolios managed by external investment managers that can’t provide easy identification of which companies are connected to Israel.

“There's no guarantee that any fund a university owns has no connection to Israel,” Marsicano says. “It's a near impossible task, just functionally getting it done.”

He adds that it would be particularly complicated for universities to divest from any company that does business in Israel, since nearly every major American multinational company does business in the country. Endowment managers also have a fiduciary responsibility to act in the best interests of the organization they oversee, which could be a “tough pill to swallow,” Marsicano says.

The Israeli-Palestinian conflict is also marked by a high degree of geopolitical sensitivity, suggesting protesters may find it difficult to persuade universities from divesting. Such actions may provoke backlash from alumni, donors, and political groups who oppose divestment initiatives on grounds of academic freedom or solidarity with Israel.

Have colleges divested from anything before?

There is a history of divestment movements that have had both symbolic and tangible impacts. Student-led divestment campaigns over South Africa apartheid rule in the 1980s pressured Columbia University to withdraw its investments from companies operating in the country. By 1988, a total of 155 colleges had at least partially divested from South Africa, with five institutions fully divesting.

On its website, the Columbia University Apartheid Divest group has compared itself to the protests on the same campus from nearly 40 years ago. "We are a continuation of the Vietnam anti-war movement and the movement to divest from apartheid South Africa."

That movement was soon followed by multiple schools’ decision to divest from the tobacco industry . “The effort to punish South Africa was a student-led thing, involving the occupation of administration buildings, but tobacco does not resonate with students that way,” Douglas Cogan, then director of tobacco information service at the Investor Responsibility Research Center, told the New York Times in 1997. “Today, faculty and administrators are leading the charge. That is particularly true when a school does cancer research and the faculty and administrators see a contradiction with its portfolio.”

Other institutions, like Stanford University, chose to divest from Sudan in 2005. “I don’t want the endowment that’s supposed to be serving me and this community invested in a country that conducts genocide,” Seth Silverman, a Stanford student said during a town hall meeting that year. At least 60 other colleges and universities opted to do the same, according to Investors Against Genocide, an organization that formerly worked to advocate for divestment of two foreign oil companies that helped fund the Darfur genocide.

More than 140 higher education institutions have divested from fossil fuels since 2011, per a research article published on the University of California Press site. Schools have also pulled investments from private prisons, with Columbia being the first university to do so in 2015. 

“We've seen other campuses divest when students demand it so we know that it's something that they can do, and we know that it's something that they will do as long as we put pressure on them to do so,” says Hinckley.

While divesting from American companies that have ties to Israel would most likely hurt endowments at universities, Marsicano says there are some examples of when divesting didn't negatively impact endowment figures. “Divesting from fossil fuels did not hurt Stanford's endowment, or Dayton’s sit-down, or Syracuse's endowment... in some cases, the endowment values rose fairly substantially after divestment.”

How schools have responded

Several universities have remained firm against student demands. Columbia University President Minouche Shafik announced on Monday that the school would not divest from Israel, but offered to “publish a process for students to access a list of Columbia’s direct investment holdings, and to increase the frequency of updates to that list of holdings.” Columbia also offered to make investments in health and education in Gaza.

In late March, the University of Michigan Regent Sarah Hubbard said the Board of Regents was “not moving to make any divestment of any kind” because the university needs a diversified investment portfolio to ensure returns remain high and risk stays low. She claimed that “less than one-tenth of the 1% of the endowment is invested indirectly” in companies with business ties to Israel, despite claims by students that the number was around one-third of the endowment, according to the University Record . The University of California and Yale University have also resisted calls for divestment. 

So far, Brown University seems to be the only college considering divestment in response to the latest protests. Administrators agreed to have five students meet with members of the Corporation of Brown University in May to present their argument for divestment, though their decision on the matter is not expected until October. 

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Presidential elections 2024: what do they mean for investors?

• Octa's latest analysis explores how these political changes might impact investment areas.

Disclaimer. We provide impartial political commentary. We do not endorse any political party or figure, focusing strictly on political events' economic and market consequences.

The bulk of 2024's electoral action will occur in Europe, with 19 countries voting. The head of state may change in 10 nations, and 11 may see parliamentary shifts. The European Parliament elections, involving 27 EU member states and affecting 447 million individuals, are especially noteworthy. According to polls, Eurosceptic parties could possibly secure up to 40% of seats.

Undoubtedly, the most intriguing event in world politics will be the November elections in the USA.

We should remember the elections in other regions, which might also reshape the global balance of power.

Traditionally, investors are sceptical about the political agenda, giving more weight to financial news, such as monetary policy adjustments or major corporate activities. However, understanding the political climate is crucial before diving into election-period investments.

In the U.S., it's once again Trump vs Biden. As of March 18, 2024, the U.S. political scene is set for a rematch between Donald Trump and Joe Biden, who have won their parties' primaries. Thus, they will soon be officially nominated for the U.S. presidency by their respective parties, mirroring the 2020 electoral battle, promising an intense campaign period.

Early elections in the UK. While initially scheduled for January 2025, the UK might experience an early election. This follows Labour leader Keir Starmer's challenge to Prime Minister Rishi Sunak, urging an earlier vote to address national challenges. Starmer stressed that the population chooses between ‘continued decline with the Conservatives or national renewal with Labour.’ Prime Minister Rishi Sunak has agreed to a 2024 election, which is currently planned for the second half of 2024.

Japan's leadership vacuum. Japan is contending with a scandal that has significantly dented Prime Minister Kishida Fumio's and Shinzo Abe's faction's authority and has led to the dismissal of four cabinet ministers, precipitating a potential leadership crisis. Kishida's faction is also on investigators' radar, and his popularity has fallen to 17%.

Kishida aims to regain public trust with promises to root out corruption and foster economic growth. Should he fail and resign, a contentious power struggle is likely to follow. Japan will get a new administration with new political priorities and possibly a new economic agenda.

Example: How elections affect economy and investors

During the presidential election season, many investors fall into the trap of believing that stocks have a better chance if their preferred party or candidate wins. However, market data shows the opposite—in the long run, financial markets rise regardless of the ruling party.

Let's take the U.S. election as an example. What can a Republican or Democrat president mean for financial markets? U.S. market history illustrates that political leadership has little correlation with market performance, as markets have generally thrived across different presidential administrations. Let's find out why.

● Good market dynamics, regardless of the ruling party. The U.S. stock market has delivered positive returns under most administrations, except for periods ending in deep recession. Since its inception in 1957, the S&P 500 index has achieved an average annual return of approximately 10%, regardless of whether Democrats or Republicans were in power. The U.S. economy also grew by about 3% annually.

● No radical economic changes despite political shifts. The structure of the US economy has remained unchanged for decades. Even periods of one-party rule did not result in significant change. The passage rate of ‘substantial’ bills did not increase while the same party controlled both the executive and legislative branches.

● The executive branch is subordinate to monetary policy. While the executive branch plays a role in economic governance, it operates under a broader framework of monetary policy, which can significantly influence the president's success. For example, Presidents Reagan and Clinton benefited from successive drops in interest rates. Conversely, Presidents George H.W. Bush and George W. Bush faced challenges due to Federal Reserve tightening policies, resulting in an inverted yield curve and recession. Meanwhile, President Obama benefited from predominantly favourable interest rates during his term, apart from a short period in 2015-2016. In contrast, President Trump was the unfortunate recipient of tightening policy during his first two years in office.

History shows that innovation and investment opportunities will continue regardless of who wins the presidential election.

There may be many political changes in the coming year that could make significant adjustments to the legislative and executive branches of government. Nevertheless, it isn't easy to see any correlation between the political situation, the president's popularity, the economy's state and the dynamics of the financial markets.

Investors should focus more on the global economic landscape and central bank policies rather than politics. Timing the financial market is generally tricky and risky. Basing such a decision on an election cycle is not wise in most situations.

Octa is an international broker that has been providing online trading services worldwide since 2011. It offers commission-free access to financial markets and various services already utilised by clients from 180 countries with more than 42 million trading accounts. Free educational webinars, articles, and analytical tools they provide help clients reach their investment goals.

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Politics latest: New Labour MP Natalie Elphicke's apology 'unlikely to change minds'

The fallout is continuing from the shock defection of MP Natalie Elphicke from the Conservatives over to Labour. She has now released a statement apologising for supporting her ex-husband, who was her predecessor as MP for Dover, after his sexual assault conviction.

Thursday 9 May 2024 18:00, UK

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• Coming up on Politics Hub With Sophy Ridge at 7pm
• New Labour MP issues apology
• Cameron says defection 'says more about Starmer'
• Rob Powell: Elphicke apology unlikely to change minds
• Re-elected Tory mayor condemns party 'chaos'
• Ex-chancellor to stand down at election  | Every MP who's quitting
• Live reporting by Ben Bloch and (earlier)  Faith Ridler

Labour MP Natalie Elphicke has apologised for comments she made supporting her ex-husband after he was convicted of sexual assault, following criticism from her new party colleagues. 

Concerns had been raised about comments she made after Charlie Elphicke, her predecessor as MP for Dover, was convicted in 2020 of sexually assaulting two women and sentenced to two years in prison.

At the time, she said in an interview with The Sun that being "attractive" and "attracted to women" had made him an "easy target".

Labour said yesterday "all those issues have been dealt with previously both in parliament and in public".

But in a new statement, Ms Elphicke said the period was an "incredibly stressful and difficult one for me as I learned more about the person I thought I knew".

She added: "I know it was far harder for the women who had to relive their experiences and give evidence against him.

"I have previously, and do, condemn his behaviour towards other women and towards me. It was right that he was prosecuted and I'm sorry for the comments that I made about his victims.

"It is vital that women can have confidence in the criminal justice system and our rates of prosecution and conviction are far too low as a country.

"Keir Starmer's mission to halve male violence against women and girls is critical and I wanted to take the opportunity to express my explicit support for Labour colleagues working to realise it."

By Alix Culbertson , political reporter

Lord Cameron has accused Labour of standing for nothing after Sir Keir Starmer accepted a right-leaning Tory MP into the party.

The foreign secretary said Sir Keir welcoming Dover MP Natalie Elphicke into Labour on Wednesday showed the party does not have a plan.

"In life, if you don't stand for something, you will fall for anything," he said following a speech about defence on Thursday.

"I thought that's sort of what yesterday said, that there isn't a policy about anything.

"It's just been about clearing the decks to try and focus attention on the governing party.

"And I think yesterday proved, 'oh, if you're going to fall for that, then you really stand for nothing'. The plan, policies? No idea."

"When you hear about a defection you think 'oh no, not another one, how are we going to handle this by the end of the day?'.

"But that says so much more about Keir Starmer, the Labour Party, and a complete lack of clarity than it does about a prime minister who's a good man, doing a great job in a difficult time," he said.

"But I think increasingly people will see that."

Mrs Elphicke's defection has been criticised on all sides of the political spectrum, with many Labour MPs unhappy to have a politician in their party who was seen as being to the right of the Tory party, especially with her views on immigration.

Read more from the speech here:

As you may be aware, the government passed legislation last year to force employers in certain key sectors to provide a minimum level of service during industrial action.

This was greeted with outrage from trade unions, who argue that it threatens the right to strike, and they are challenging it in the courts.

Today, the High Court ruled that the judicial review requested by trade unions can proceed.

The general secretary of the Public and Commercial Services (PCS) Union, Fran Heathcote, accused the government of "once again attacking trade unions".

"PCS will not stand by and allow them to erode our members' rights and freedoms and we welcome the Court's decision to allow our claim to proceed to judicial review," she added.

TUC general secretary Paul Nowak said this is "another setback for the government's draconian anti-strikes laws", labelling them "a fundamental attack on the right to strike".

"We will keep fighting this spiteful legislation and will not rest until it is repealed," he added.

Downing Street has been contacted for comment.

On this episode, Niall Paterson speaks to one of the doctors who worked to restore the hearing of an 18-month-old girl – who was born deaf.

Medics at Addenbrooke's Hospital in Cambridge have used gene therapy to help a rare condition, auditory neuropathy. It's caused by the disruption of nerve impulses travelling from the inner ear to the brain.

Opal Sandy can now respond to her parents' voices and can communicate words such as "Dada" and "bye-bye".

Plus, Natalie Elphicke, the MP who defected from the Conservatives to Labour yesterday, apologises for comments she made after her ex-husband, and predecessor as MP for Dover, was convicted of sexual assault in 2020.

She said at the time that being "attractive" and "attracted to women" had made him an "easy target".

Niall talks to deputy political editor Sam Coates about the disquiet within Labour over Mrs Elphicke’s arrival.

👉  Listen above then tap here to follow the Sky News Daily wherever you get your podcasts  👈

Over a year ago, Rishi Sunak made five pledges for voters to judge him on.

The prime minister met his promise to halve inflation by the end of 2023.

But with the general election approaching, how is Mr Sunak doing on delivering his other promises?

You can see the progress for yourself below:

The prisons watchdog has said Wandsworth prison should be placed into emergency measures amid major concerns over security failings and severe problems with overcrowding, drugs, violence and self-harm.

Wandsworth, in southwest London, is one of the largest prisons in the UK.

Chief inspector of prisons Charlie Taylor has published "deeply concerning findings", and has written to Justice Secretary Alex Chalk to issue an urgent notification for improvement at the category B jail in southwest London.

Mr Taylor said there are "systemic and cultural failures" that have "stemmed from poor leadership at every level of the prison, from HMPPS and the Ministry of Justice."

He continued:  "Many well-meaning and hard-working leaders and staff persevered at Wandsworth, and their resilience was impressive, but they were often fighting against a tide of cross-cutting, intractable problems that require comprehensive, long-term solutions."

'Risk of death or escape from custody'

In order for the prison to start to recover, he said, it needs "permanent experienced leaders at all levels who are invested in its long-term future to improve security, safety and guide their less experienced colleagues".

"Until this happens, the risk of a further catastrophe, a self-inflicted death or escape from lawful custody, is ever present," he concluded.

In response to the report, prisons minister Edward Argar acknowledged the "significant challenges" the prison faces.

He said the government will be "strengthening the management team" in the "coming weeks" to "provide the leadership, culture change and training needed to turn Wandsworth around".

The Sky News live poll tracker - collated and updated by our Data and Forensics team - aggregates various surveys to indicate how voters feel about the different political parties.

With the local elections complete, Labour is still sitting comfortably ahead, with the Tories trailing behind.

See the latest update below - and you can read more about the methodology behind the tracker  here .

By Jennifer Scott , political reporter

In a dramatic move just moments before Prime Minister's Questions got under way this week, Natalie Elphicke joined Labour as her surprised Conservative colleagues looked on.

What exactly happens when an MP defects to another party?

Ms Elphicke  is far from the first MP to change sides between elections, but it was incredibly rare - until recently - for a member of the governing party to switch to the opposition.

She is the third Tory to do so in just over two years, following  Christian Wakeford in 2022  over the partygate scandal and  Dan Poulter just two weeks ago  over the Tories' handling of the NHS.

Before that, it hadn't happened since 1995, when Alan Howarth became the first ever Conservative to cross to Labour on the eve of his party conference, citing the "divisiveness" of policies under John Major's leadership.

Only three MPs in the past 25 years have gone the other way - from main opposition to government - all leaving the Conservatives to join Labour.

Defecting to smaller parties happens more often, such as moves  from both Conservative and Labour to Change UK  during the Brexit years, or  Douglas Carswell  and  Mark Reckless  heading over to UKIP ahead of the referendum.

Our flagship weeknight politics show  Politics Hub With Sophy Ridge  will be live on Sky News from 7pm.

The fast-paced programme dissects the inner workings of Westminster, with interviews, insights, and analysis - bringing you, the audience, into the corridors of power.

Sophy will be joined tonight by security minister Tom Tugendhat  to discuss the rise in antisemitism in the UK, as well as broader security threats facing the country.

And on Sophy's panel will be:

• Sonia Sodha , chief leader writer at The Observer;
• Charlie Rowley , former adviser to minister Michael Gove.

Watch live on Sky News, in the stream at the top of this page, and follow live updates here in the Politics Hub.

As we've reported, the prime minister met this morning with representatives of the Union of Jewish Students, other Jewish communal organisations, and vice-chancellors of a number of universities.

We've just had a readout of the conversation from Downing Street.

A Downing Street spokesperson said Rishi Sunak called on universities to "remain bastions of tolerance, where debate takes place with respect for others and where every student feels safe".

He wants university leaders to take "personal responsibility for protecting Jewish students", and have a "zero tolerance" approach to antisemitism and all forms of hatred.

The PM welcomed a new Office for Students initiative that aims to hold universities to account for dealing with antisemitism.

Representatives from the Union of Jewish Students attended the meeting, and Downing Street said university leaders "recognised" the challenge of dealing with rising antisemitism.

The group "discussed the importance of properly enforcing disciplinary procedures against students found to be inciting hatred or violence, while respecting the legitimate right to protest".

Also in attendance at the meeting was Tom Tugendhat, the security minister, and he made the point that "actions have consequences and freedom of speech didn’t extend to the right to abuse or intimidate".

Mr Tugendhat will join us on Politics Hub With Sophy Ridge from 7pm.

As we reported earlier this week, the Ministry of Defence (MoD) was hacked, with data about armed forces personnel being accessed.

In a statement in the Commons on Tuesday, Defence Secretary Grant Shapps confirmed contractor SSCL's system was breached by a "malign actor", and that the Cabinet Office is investigating, alongside the MoD.

Sky News revealed that  China was responsible for this MoD breach , but Mr Shapps refused to confirm that in the Commons.

Labour's national campaign coordinator, Pat McFadden, has written to the deputy PM, Oliver Dowden, on the matter.

'Utterly unacceptable'

He hit out at recent security breaches, asking for more details on this recent one, and pushing for the actor responsible to be named.

The senior Labour MP wrote: "Any such hostile action against our forces is utterly unacceptable, but this is the latest in an increasing list of serious cybersecurity breaches."

He cited the hacks on the Electoral Commission, parliamentarians, the British Library, and NHS trusts, raising questions about the UK's broader cyber defences.

He asked the deputy PM to confirm if more data has been breached than has already been confirmed, when the investigation will conclude, and what action will be taken to secure other IT system.

Given that Mr Shapps refused to confirm Sky's report that China was responsible for the breach, Mr McFadden asked: "Can you confirm if and when the government will be able to attribute this attack to a specific actor?"

In the Commons on Tuesday, Mr Shapps committed to naming the actor responsible as soon as possible, but said there is a somewhat lengthy process to be gone through before a minister can formally attribute responsibility.

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