PRESIDENT ROOSEVELT hoped that shifting Thanksgiving from the last
to the fourth Thursday of November would stimulate the 1939 economy
by lengthening the Christmas shopping season. The measure stimulated
more debate than employment.
Ordinarily, techniques of seasonal adjustment escape controversy. Except
in recession, business analysts and econometricians are inclined to
accept seasonally adjusted figures without question. Only in slack times is
each monthly pip of the unemployment rate awaited with keen anticipation.
Regrettably, it is precisely in these times that technical problems in
seasonally adjusting the unemployment rate become particularly acute.
While the distortions are short-lived inasmuch as the annual average is
insensitive to the particular procedure used in seasonally adjusting the
data, they can befuddle the analyst attempting to identify the cycle's
lower turning point. This paper presents a least-squares alternative to the
official method for seasonally adjusting the unemployment rate.