The unemployment rate may be much lower, the nation’s former top statistician says

Each month, the U.S. Census Bureau and the Bureau of Labor Statistics conduct the Current Population Survey which is used to calculate key economic indicators such as the unemployment rate as well as the wage rate.

While the survey data is meant to be representative of the entire workforce, there is growing concern that the questions fail to capture non-traditional work or non-primary work. Nearly 4% of those currently labelled as not having any job, and nearly 22% altogether, had their employment misclassified.

That’s the conclusion of a report released Monday written by Katherine Abraham, a professor of economics and survey methodology at the University of Maryland who also served as commissioner of the BLS from 1993 through 2001, and Ashley Amaya, a research survey methodologist at RTI, a nonprofit research institute based in Piedmont, N.C.

As MarketWatch previously reported, many workers may not think of themselves as having a primary job and, therefore, do not often report side hustles and other freelance work. “We rely on the CPS to provide us with a picture of work activity, and if it missing things then we don’t have a complete picture,” Abraham said.

Some of the questions the researchers ask focus on a sector known as the “gig economy”. Currently, the BLS does not track the gig economy partially because there is no agreed upon definition of gig work.

“In the CPS we are looking for information about people’s main jobs only and not secondary jobs or additional jobs,” Karen Kosanovich, an economist at the BLS, told MarketWatch.

By asking more specific questions, it may be possible to better understand the work that does not appear in the monthly unemployment report. When CPS respondents are asked follow-up questions about work activity outside of a regular job, it is possible to uncover more meaningful insights about the workforce which otherwise would not appear in the CPS, they wrote.

To highlight the amount of work that goes largely unnoticed by the BLS, the researchers not only asked about the type of additional or non-primary work respondents are involved also about the number of hours worked and salary earned.

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