fbpx US unemployment rate falls in August as many workers on temporary layoffs return to work - Jason Furman | Harvard Kennedy School

HKS Affiliated Authors


September 4, 2020, Opinion: "The official unemployment rate fell to 8.4 percent in August from 10.2 in July, marking the first time the unemployment rate has been below 10 percent since March. As in prior months of the pandemic, the official unemployment rate continues to understate the unemployment rate from a historically-comparable perspective because it counts an extra 1.1 million people who were "not at work for other reasons" as employed (the so-called "misclassification error") and also because 3.7 million people have left the labor force since February, more than would be expected even given this large increase in unemployment. Adjusting for these factors our "realistic unemployment rate" was 9.9 percent in August, falling faster than the official unemployment rate as the misclassification error continued to shrink and labor force participation increased."