'Misclassification Error' Leads To Inaccurate May Jobs Report

The May jobs report initially seemed positive, but an error was found indicating the unemployment rate was actually 16.3%, higher than the reported 13.3%. The Bureau of Labor Statistics (BLS) and Census Bureau are investigating the mistake, which involved misclassifying some temporarily unemployed individuals as employed but absent for other reasons. This issue, first noticed in March, suggests that unemployment rates for March and April were also understated. The misclassification was partly due to COVID-19, as people waiting to return to jobs were incorrectly categorized.

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