METHODS OF FORECASTING SHORT TERM UNEMPLOYMENT CHANGE,
Abstract
The present report outlines preliminary findings in a study of how to develop a practical model for the forecasting of short term unemployment changes. Since the varying tide of demands for GNP final goods and services is surely central in any explanation of variations in employment and unemployment, the author began with one approach to measuring these forces. The use was explored of manufacturers' unfilled orders (in the form of a ratio of orders minus inventories to sales). This was done because variations in factory hirings are sparked by orders, and because these in turn stimulate demands on suppliers (e.g. mining) and distributors (e.g. transport, trade) of factory products. The ratio that was derived proves to be highly correlated with unemployment levels since 1947, at -.865. A second category of variables investigated are those that relate to the gradual diffusion of business cycle change--among firms, industries, areas, etc. A third category of variables studied relate to the persistence of business cycle change. For a persistent trend of employment, even if small, reports something just as relevant to forecasting future trends as the mere magnitude of change in a given period.
Document Details
- Document Type
- Technical Report
- Publication Date
- Oct 01, 1964
- Accession Number
- AD0608771
Entities
People
- Stanley Lebergott