Seasonal Fluctuations

Seasonal fluctuations are regular changes in economic activity that happen at the same time every year.

These patterns repeat because of factors such as weather, holidays, and institutional schedules, among others.

First, weather patterns can affect economic activity.

For example, in countries such as the United States and Germany, construction slows down during the cold winter months.

Next, holidays also cause changes in economic activity.

For example, in many countries, retail stores often see higher sales in November and December.

During this time, people shop for holidays such as Christmas and New Year's, buying gifts, decorations, and festive items.

Lastly, institutional schedules also affect economic activity.

For example, schools may close down for long holidays during a specific time of year.

Families may spend more on travel during this period.

When economists study an indicator such as unemployment, they may focus on the adjusted rate, which removes regular seasonal patterns found in the unadjusted rate. This helps them identify less predictable influences.