In contrast, third quarter economic activity increased by 2.7 percent over the second quarter. The index rose to a seasonally adjusted value of 102.9 from 100.2 in the second quarter. January 1994 is the base month for the index and its value is set at 100. Thus the 102.2 value for September indicates that the level of economic activity has increased 2.2 percent since that time. The graph below plots the seasonally and non-seasonally adjusted values for the index of economic activity from January 1994 through September 1996.
Seasonal adjustment is a technique that eliminates seasonal variation from the economic data.
An increase in the seasonally adjusted series represents an increase in economic activity beyond normal seasonal fluctuations. Therefore, the seasonally adjusted series is a better measure of fundamental change in the economy. The bar chart below displays the change in the seasonally adjusted index components between the second and third quarters of 1996. The composite index describes the overall change in economic activity in Humboldt County and, as mentioned above, the index rose to a seasonally adjusted value of 102.9 from 100.2 in the second quarter. A sharp increase occurred in manufacturing and housing, home sales seem to have rebounded from their decline in the second quarter.