But What’s the Real Unemployment Rate?

Whenever there’s an economic downturn, there’s a debate about the limits of the much-watched unemployment rate: People who give up looking for work are considered out of the labor force rather than unemployed; those who have to take part-time work when they’d rather be full-time are still considered employed; etc. Such points are made especially fervently by the party out of power. But this is 2020, so the debate has to be crazier and weirder this time around. Yesterday, upon hearing the news that the unemployment rate actually declined in May, Paul Krugman half-seriously floated the theory that the administration was manipulating the statistics and later apologized. Now the Washington Post is out with a story titled “A ‘misclassification error’ made the May unemployment rate look better than it is. Here’s what happened.”

The story itself takes the shock out of the headline. Nothing went wrong with the May unemployment rate in particular. There’s just an ongoing, and incredibly boring, technical difficulty stemming from the pandemic.

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