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Photo: Marcelo Hernandez/Getty Images

The responses of fewer than 41,000 people were used to determine a major part of last month's U.S. unemployment rate, the Bureau of Labor Statistics tells Axios.

Why it matters: That's the lowest number in modern history and is one of many unusual developments in government data collection that have affected important readings for months.

What it means: The surprises in May's nonfarm payrolls report, which found there were only 21 million unemployed while 30 million Americans were collecting unemployment insurance benefits, were largely the result of oddities in data collection.

  • A portion of the jobs report is determined by a household survey in which government workers interview people at their homes and determine whether any person over the age of 16 is "employed, unemployed, or not in the labor force" — the only three possible designations.

What's happening: The coronavirus pandemic has "depressed" survey responses since March, as BLS stopped conducting in-person meetings, restricting its ability to reach new households, Julie Hatch Maxfield, BLS associate commissioner for employment and unemployment statistics, tells Axios.

  • "The first month of the sample we get a lot of information and that sets up the whole thing going forward," she says.
  • This has taken the response rate from 82% in January to 73% in March to 67% in May.
  • "Response rates probably will be depressed even when interviewers go back into the field," Maxfield notes.

What else: In May, BLS identified 9 million people who had lost their jobs but were counted as "not in the labor force" rather than unemployed because they hadn't been searching for a job in the last four weeks due to the pandemic.

  • If those people were considered unemployed it would have taken the unemployment rate to 17.9%.
  • A similar calculation would have put the unemployment rate at 19.8% in April and 7.5% in March, BLS says in a report about the coronavirus pandemic's impact on its data.
  • A separate "misclassification error" categorized millions of workers who had been absent and likely lost their jobs as employed.
  • Additionally, workers who were paid by their employer for any part of the pay period including the 12th of the month were counted as employed, even if they weren't actually at their jobs.

The bottom line: We may never know how many people lost their jobs as a result of the coronavirus pandemic.

  • However, according to BLS, both the number of unemployment insurance claims and the number of unemployed people appear to have peaked in April and are declining.
Data: U.S. Department of Labor; Chart: Andrew Witherspoon/Axios

Another 1.5 million Americans applied for first-time traditional unemployment insurance benefits last week, and 700,000 more applied for benefits under the Pandemic Unemployment Assistance (PUA) program.

  • Combined with a decline in the number of people in the U.S. who are receiving benefits, total claims have dropped to 35.4 million from 37.2 million last week.

Background: The CARES Act allowed millions of people who had been impacted by the coronavirus pandemic but previously would not have qualified for unemployment insurance — the self-employed, people who had quit their job, those who had offers of employment but had not yet started a job — to qualify for PUA benefits.

  • Tens of millions have been approved for benefits under PUA, but many are not considered unemployed by BLS standards.

Go deeper

Sep 18, 2020 - Health

Rep. Khanna: COVID-19 could change the perception of public health care

Rep. Khanna and Axios' Margaret Talev

The universal experience of COVID-19 could change how opponents view Medicare for All, Rep. Ro Khanna (D-Calif.) said at an Axios virtual event on Friday.

What they're saying: "The pandemic has reminded us of our shared humanity with other American citizens. It's no longer possible to think, 'Oh, we're not part of those who get sick.' Now almost everyone knows, unfortunately, someone who has been hospitalized, someone who had a serious bout with COVID," Khanna said.

Felix Salmon, author of Capital
Updated 8 mins ago - Economy & Business

How central banks can save the world

Illustration: Aïda Amer/Axios

The trillion-dollar gap between actual GDP and potential GDP is a gap made up of misery, unemployment, and unfulfilled promise. It's also a gap that can be eradicated — if central banks embrace unconventional monetary policy.

  • That's the message from Eric Lonergan and Megan Greene, two economists who reject the idea that central banks have hit a "lower bound" on interest rates. In fact, they reject the idea that "interest rates" are a singular thing at all, and they fullthroatedly reject the idea — most recently put forward by New York Fed president Bill Dudley — that the Fed is "out of firepower."

Why it matters: If Lonergan and Greene are right, then central banks have effectively unlimited ammunition in their fight to increase inflation and employment. They are limited only by political will.

Updated 27 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Large coronavirus outbreaks leading to high death rates — Coronavirus cases are at an all-time high ahead of Election Day — Fauci says U.S. may not return to normal until 2022
  2. Politics: Top HHS spokesperson pitched coronavirus ad campaign as "helping the president" — Space Force's No. 2 general tests positive for coronavirus
  3. World: Taiwan reaches a record 200 days with no local coronavirus cases — Europe faces "stronger and deadlier" wave France imposes lockdown Germany to close bars and restaurants for a month.
  4. Sports: Boston Marathon delayed MLB to investigate Dodgers player who joined celebration after positive COVID test.