Unemployment Rates During the COVID-19 Pandemic: In Brief (R46554, Version 6, Updated January 12, 2021)

Summary

Version 6 of this Congressional Research Service In Brief, updated January 12, 2021, reports an unemployment rate of 6.7% in December, down from 14.8% in April 2020. Leisure and hospitality unemployment fell from 39.3% in April to 16.7% in December, while the mining industry, with looser attachment to in-person services, stood at 13.1%, the second highest among all industries. The part-time and full-time gap seen in April (24.5% against 12.9%) has effectively closed, and the gap between workers with and without a college degree remained in December. In April every state and the District of Columbia exceeded its highest Great Recession unemployment rate.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

Unemployment Rates During the COVID-19
Pandemic: In Brief

Updated January 12, 2021

Congressional Research Service
https://crsreports.congress.gov
R46554
SUMMARY

R46554
Unemployment Rates During the COVID-19
January 12, 2021
Pandemic: In Brief
Gene Falk, Coordinator
The Coronavirus Disease 2019 (COVID-19) pandemic has had a significant effect on Specialist in Social Policy
unemployment in every state, industry, and major demographic group in the United
States. This report provides information on which groups have experienced the largest Jameson A. Carter
increases in unemployment rates since the onset of the pandemic in 2020. Young Research Assistant
workers, women, workers with low educational attainment, part-time workers, and racial
and ethnic minorities had relatively high unemployment rates in April. Many, but not all, Isaac A. Nicchitta
of these groups had relatively high rates in December as well. The report also compares Research Assistant
the overall unemployment rate during the current recession with the unemployment rate
experienced during the Great Recession. This report shows the following: Emma C. Nyhof
Research Assistant
 The unemployment rate peaked at an unprecedented level, not seen since data
collection started in 1948, in April 2020 (14.8%) before declining to a still- Paul D. Romero
elevated level in December (6.7%). Research Assistant
 In April, every state and the District of Columbia reached unemployment rates
greater than their highest unemployment rates during the Great Recession.
 In the early months of the recession, unemployment was concentrated in
industries that provide in-person services. Notably, the leisure and hospitality industry
experienced an unemployment rate of 39.3% in April, before declining to 16.7% in December.
While rates for service industries remain elevated, other industries with loose attachment to in-
person services are now experiencing high rates. For example, the mining industry exhibited an
unemployment rate of 13.1% in December, the second highest observed among all industries.
 Part-time workers experienced an unemployment rate almost twice that of their full-time
counterparts in April (24.5% vs. 12.9%), but this gap has since effectively closed.
 Workers without a college degree experienced worse unemployment rates in April (e.g., 21.2%
for workers with no high school degree) than workers with a Bachelor’s degree or higher (8.4%).
The gap between educated and less-educated workers remained in December.
 Teenaged women experienced an unemployment rate of 36.6% in April, and teenaged men,
28.6%; compared with 13.7% for women and 12.1% for men ages 25-54. The gap between men
and women has since narrowed overall, but young workers are still experiencing relatively high
rates of unemployment.
 Racial and ethnic minorities had relatively high unemployment rates in April (16.7% for Black
workers compared to 14.2% for White workers, and 18.9% for Hispanic workers compared to
13.6% for non-Hispanic workers), and these gaps persisted in December.

Congressional Research Service
Unemployment Rates During the COVID-19 Pandemic: In Brief

Contents
Introduction ................................................................................................................... 1
U.S. Unemployment Rate: Historical Trends ....................................................................... 1
Comparing the Great Recession and the COVID-19 Recession ......................................... 2
COVID-19 Recession: Unemployment Trends..................................................................... 3
Unemployment Rates by State..................................................................................... 3
Unemployment Rates by Industry ................................................................................ 5
Unemployment Rates for Full- and Part-Time Workers.................................................... 7
Unemployment Rates by Sex and Age .......................................................................... 7
Unemployment Rates by Racial Group and Hispanic Ethnicity ......................................... 8
Unemployment Rates by Education ............................................................................ 10
Data Limitations and Caveats.......................................................................................... 10
COVID-19-Related Data Issues ................................................................................. 11
General Data Caveats ............................................................................................... 12

Figures
Figure 1. Historical Unemployment Rate ............................................................................ 2
Figure 2. U.S. Unemployment Rate.................................................................................... 3
Figure 3. Monthly State Unemployment Rates ..................................................................... 4
Figure 4. Monthly Unemployment Rates by Industry ............................................................ 6
Figure 5. Monthly Unemployment Rates for Full- and Part-Time Workers ............................... 7
Figure 6. Monthly Unemployment Rates by Sex and Age ...................................................... 8
Figure 7. Monthly Unemployment Rates by Racial Group ..................................................... 9
Figure 8. Monthly Unemployment Rates by Hispanic Origin ................................................. 9
Figure 9. Unemployment Rates by Education .................................................................... 10

Contacts
Author Information ....................................................................................................... 13

Congressional Research Service
Unemployment Rates During the COVID-19 Pandemic: In Brief

Introduction
The National Bureau of Economic Research declared the start of the current economic downturn
in February 2020, marking the end of the longest period of expansion in U.S. history. 1 This
expansion followed the Great Recession (December 2007 to June 2009), a downturn widely
considered to be the worst since the Great Depression (August 1929 to March 1933). 2 The
unemployment rate rose quickly in March 2020, and by April 2020 it had greatly surpassed its
previous peaks observed during and just after the Great Recession. This spike in unemployment
coincided with various mandated stay-at-home orders implemented in response to the
Coronavirus Disease 2019 (COVID-19) pandemic and other pandemic-related factors affecting
U.S. demand. 3 Although unemployment rates have declined since April, the December rate
(6.7%) remains almost twice as high as the rate observed during February (3.5%).
This report discusses recent unemployment rate patterns at the national and state levels using
Bureau of Labor Statistics (BLS) data. The two primary sources are the Current Population
Survey (CPS) and the Local Area Unemployment Statistics (LAUS) program. In addition to the
usual caveats about estimates (see “General Data Caveats”), there were additional data challenges
caused by the COVID-19 pandemic (see “COVID-19-Related Data Issues”). The pandemic led to
lower survey response rates by businesses and households, and BLS detected an error in their
categorization procedures that likely underestimated unemployment early in the recession. 4 This
report generally finds the following:
 The unemployment rate peaked at a level not seen since data collection started in
1948, in April 2020 before declining to a still-high level in December.
 In April, every state and the District of Columbia reached unemployment rates
greater than their highest unemployment rates during the Great Recession.
 Unemployment during the current recession is concentrated among workers who
were last employed in industries that provide in-person services and among
young workers, women, workers with low educational attainment, part-time
workers, and racial and ethnic minorities.

U.S. Unemployment Rate: Historical Trends
Prior recessions typically developed with gradually increasing economic distress. The current
recession was caused by the COVID-19 pandemic, which was an abrupt and exogenous shock to
the economy. The pandemic resulted in limiting contact among individuals and in many shutdown
orders. Therefore, the trends in the unemployment rate in the current recession differ from those
in prior recessions (see Figure 1). Rates observed during prior recessions rose relatively
gradually over the course of an economic downturn and then peaked. The current recession
exhibited an unprecedented sharp increase in the rate (10.3 percentage points) from February to
1 T he National Bureau of Economic Research; see https://www.nber.org/cycles.html for their historical series of

expansions and contractions. For more on their process for determining expansions and contractions, see
https://www.nber.org/cycles/recessions_faq.html#:~:text=
What%20is%20an%20expansion%3F,more%20than%20a%20few%20months.& text=
Expansion%20is%20the%20normal%20state,economy%3B%20most%20recessions%20are%20brief .
2 T he unemployment rates observed during the Great Recession, however, never surpassed those of the early 1980’s.

3 See CRS Insight IN11388, COVID-19: U.S. Economic Effects, by Rena S. Miller and Marc Labonte.

4 See CRS Insight IN11456, COVID-19: Measuring Unemployment, by Lida R. Weinstock.

Congressional Research Service 1
Unemployment Rates During the COVID-19 Pandemic: In Brief

April 2020. 5 Following April, the rate declined rapidly (8 percentage points from April to
December 2020) as temporarily furloughed workers returned to work. Despite these rapid
declines, the December unemployment rate persisted at a high level (6.7%). The share of workers
on furlough has declined since peaking in April, while the share of permanently laid off workers
has steadily increased and has now passed the number furloughed for the first time since March
2020. 6 The Congressional Budget Office (CBO) and the Federal Reserve have projected that
elevated unemployment rates over 6% will persist over the next three years. 7

Figure 1. Historical Unemployment Rate
Seasonally adjusted monthly data from January 1948 to December 2020

Source: Created by CRS using data from the Bureau of Labor Statistics (BLS).
Notes: Shaded regions indicate recessionary periods as identified by the National Bureau of Economic Research.

Comparing the Great Recession and the COVID-19 Recession
During the Great Recession, the unemployment rate increased from 5% in December 2007 (the
start of the recession) to 9.5% in June 2009 (the end of the recession) (see Figure 2). The
unemployment rate peaked at 10% in October 2009, four months after the recession officially
concluded. In the current recession, the unemployment rate increased from 3.5% in February
2020 to 4.4% in March 2020, peaked8 at 14.8% in April, and then fell to 6.7% in December. The
peak represents the quickest month-over-month increase in unemployment rates and the highest
overall unemployment rate since the CPS data started being collected in 1948. 9

5
For information on the differences between the congressional response to the current recession compared to the
congressional response during the Great Recession in the Unemployment Insurance system, see CRS Report R46472,
Comparing the Congressional Response to the Great Recession and the COVID-19-Related Recession: Unemployment
Insurance (UI) Provisions, by Katelin P. Isaacs and Julie M. Whittaker.
6
CRS analysis of BLS data, which can be found at https://www.bls.gov/webapps/legacy/cpsatab11.htm. Workers on
temporary layoff declined from 18 million in April to 3 million in December as the number of permanent job losers
increased from 2 million in April to 3.3 million in December.
7 See CRS Insight IN11460, COVID-19: How Quickly Will Unemployment Recover?, by Lida R. Weinstock.

8 T hroughout this report, peak refers to the highest level of unemployment between January 2020 and December 2020.

It does not account for months outside this range.
9 T here are many differences in labor force statistics observed during the Great Recession, its aftermath, and the

COVID-19 recession. For more on this and for information on labor market patter ns since 2007, see CRS Report
R45330, Labor Market Patterns Since 2007, by Sarah A. Donovan and Marc Labonte.

Congressional Research Service 2
Unemployment Rates During the COVID-19 Pandemic: In Brief

Figure 2. U.S. Unemployment Rate
Seasonally adjusted monthly data from November 2004 to December 2020

Source: Created by CRS using data from the Bureau of Labor Statistics (BLS).

COVID-19 Recession: Unemployment Trends
The COVID-19 pandemic has affected the unemployment rates for every state, industry, and
major demographic group. In the early stages of the current recession, unemployment rates
disproportionately increased in industries delivering in-person services. Some demographic
groups are overrepresented in such industries, contributing to higher rates for those workers. 10

Unemployment Rates by State
Figure 3 displays state-level monthly unemployment rates from January to November 2020 and
indicates whether the rate increased or decreased from October to November. The data for
December 2020 have not been released as of the cover date of this report. Further, the figure
shows that no state was immune from economic damage early in the pandemic. 11 Since the onset
of the current recession, the unemployment rate for every state and the District of Columbia
surpassed levels seen during the Great Recession. The variation in economic damage was due to a
number of factors, including the proportion of jobs in sectors that provide non-essential services

10
Guido Matias Cortes and Eliza Forsythe, “ T he Heterogeneous Labor Market Impacts of the Covid-19 Pandemic,”
Upjohn Institute, May 2020; and Robert Fairlie, “T he Impact of Covid-19 on Small Business Owners: Evidence of
Early-Stage Losses from the April 2020 Current Population Survey,” NBER Working Paper No. 27309, June 2020.
11 Felipe Lozano-Rojas et al., “Is the Cure Worse than the Problem Itself? Immediate Labor Market Effects of COVID -

19 Case Rates and School Closures in the U.S.,” NBER Working Paper No. 27127, May 2020; Eliza Forsythe et al.,
“Labor Demand in the T ime of COVID-19: Evidence from Vacancy Postings and UI Claims,” NBER Working Paper
No. 27061, April 2020.

Congressional Research Service 3
Unemployment Rates During the COVID-19 Pandemic: In Brief

to in-person customers, 12 individual fears of contracting COVID-19 causing declines in personal
consumption, 13 and the implementation of stay-at-home orders and business closure policies. 14

Figure 3. Monthly State Unemployment Rates
Seasonally adjusted data, displaying rates from January to November 2020 and change since last month

Source: Created by CRS using data from the Bureau of Labor Statistics (BLS) Local Area Unemployment
Statistics program.
Notes: The National Bureau of Economic Research identified February of 2020 as the first month of the current
recession. The month-over-month changes are point estimates and have not been tested for significance. The
data for December 2020 have not been released as of the cover date of this report.

The unemployment rate in most states peaked in April 2020 and has since declined. In November,
the five states with the highest unemployment rates were New Jersey (10.2%), Hawaii (10.1%),
Nevada (10.1%), New York (8.4%), and Louisiana (8.3%). The states with the lowest

12 Matthew Dey and Mark Loewenst ein, “How many workers are employed in sectors directly affected by COVID-19

shutdowns, where do they work, and how much do they earn?” Monthly Labor Review, April 2020.
13 Austan Goolsbee and Chad Syverson, “Fear, lockdown, and diversion: comparing drivers of pandemic economic

decline 2020,” NBER Working Paper No. 27432 , June 2020.
14 Sumedha Gupta et al., “Effects of Social Distancing Policy on Labor Market Outcomes,” NBER Working Paper No.

2780, May 2020.

Congressional Research Service 4
Unemployment Rates During the COVID-19 Pandemic: In Brief

unemployment rates in November were Nebraska (3.1%), Vermont (3.1%), South Dakota (3.5%),
Iowa (3.6%), and New Hampshire (3.8%).

Unemployment Rates by Industry
Workers whose last job was in the leisure and hospitality industry experienced a higher peak in
unemployment (39.3% in April 2020) than did workers who were previously employed in any
other industry; they also had the highest unemployment rate in December 2020 (16.7%).
However, elevated unemployment rates are not constrained to industries providing in-person
services. Workers whose last job was in the mining or extraction industry have experienced
steadily increasing unemployment since the onset of the recession; in December they exhibited
the second highest rate among all workers across industries (13.1%). The lowest December rates
were among workers whose last job was in the government (3.2%) or financial activities (3.1%)
industries. These two industries have had unemployment rates below 15% from January through
December. 15 Within industries, some workers were more likely to lose their jobs than others. For
example, recent studies suggest that low-wage workers in the leisure and hospitality industry and
other services industries experienced disproportionately large employment losses. 16
Figure 4 displays the unemployment rate data for industries while indicating whether the change
from 2019 to 2020 in a given month is statistically significant. 17 CRS chose to compare 2019 and
2020 because of a lack of seasonally adjusted data. Without seasonal adjustments, it is difficult to
determine whether unemployment trends are related to the recession or to seasonal trends. This
report attempts to minimize seasonal influences (for non-adjusted data) by comparing year-over-
year estimates for each month. For example, the figure shows that over the course of the current
recession, the unemployment rate steadily declined for agricultural workers (before increasing as
winter approached) and steadily increased for mining and extraction workers. However, the
changes in unemployment rates for agricultural workers are not considered statistically significant
when tested against the prior year of data, while increases for mining and extraction workers are
statistically significant.

15 T he third lowest December 2020 unemployment rate was in the education and health services sector (4.1%). T hese

data are not seasonally adjusted and do not account for the likely seasonal variation in employment within the
education and health services sector.
16
Alexander Bartik et al., “ Measuring the labor market at the onset of the COVID-19 crisis,” NBER Working Paper
No. 27613, July 2020; and Guido Matias Cortes and Eliza Forsythe, “ T he Heterogeneous Labor Market Impacts of the
Covid-19 Pandemic,” Upjohn Institute Working Paper, May 2020.
17
BLS publishes a series of formulas used to produce standard errors for unemployment rates, from which they can
calculate confidence intervals to determine whether a year-over-year difference is statistically significant. CRS used
these formulas to calculate significance at the 95% confidence level. Bureau of Labor Statistics, “Calculating
Approximate Standard Errors and Confidence Intervals for Current Population Surv ey Estimates,” Washington, DC,
2018, p. 10, https://www.bls.gov/cps/calculating-standard-errors-and-confidence-intervals.pdf.

Congressional Research Service 5
Unemployment Rates During the COVID-19 Pandemic: In Brief

Figure 4. Monthly Unemployment Rates by Industry
Non-seasonally adjusted data, displaying differences between 2019 and 2020 for each month, and
statistical significance of year-over-year differences from January to December 2020

Source: Bureau of Labor Statistics (BLS).
Notes: Due to the lack of seasonal adjustment for these data, the 2020 unemployment rates for the different
industries are compared to their non-seasonally adjusted values from 2019. Statistical significance of year-over-
year differences is indicated by a black outline. Industry sectors are defined by the North American Industry
Classification System (NAICS) and can be found at https://www.bls.gov/iag/tgs/iag_index_naics.htm. The figure
shows unemployment rates for wage and salary workers.

Congressional Research Service 6
Unemployment Rates During the COVID-19 Pandemic: In Brief

Unemployment Rates for Full- and Part-Time Workers
As shown in Figure 5, part-time workers experienced a higher peak unemployment rate (24.5%
in April 2020) than full-time workers (12.9% in April). This disparity has closed as the recession
has progressed, as the unemployment rate for part-time workers in December 2020 (7.0%)
roughly equals the unemployment rate for full-time workers (6.7%).
There are a few reasons why part-time workers’ apparent recovery since April may not reflect the
economic realities they face. First, the gap between full- and part-time workers may have
narrowed because workers with part-time jobs are leaving the labor force. It is unclear whether
that is the case, though labor force participation rates have declined since March. Additionally,
workers who normally would be working full-time may be working part-time for economic
reasons. This could reduce the unemployment rate among part-time workers. BLS has observed
that during the current recession, measures of labor underutilization, including workers who are
part-time due to economic reasons, have remained elevated. 18

Figure 5. Monthly Unemployment Rates for Full- and Part-Time Workers
Seasonally adjusted data, January 2020 to December 2020

Source: Created by CRS using data from the Bureau of Labor Statistics (BLS).

Unemployment Rates by Sex and Age
As seen in Figure 6, unemployment rates tended to increase more for younger workers and were
higher for women early in the recession. Between February and April 2020, the rate for women
ages 16-19 increased by 25.8 percentage points to 36.6%; in contrast, the rates for men of the
same age increased by 16.4 percentage points to 27.6%. Since then, the gap between men and
women has narrowed. Although unemployment rates for younger workers remain relatively high
compared to older workers, the December rates for men and women across age groups have
declined to somewhat similar levels. The unemployment rate for teenaged men (15.5%) was
lower than the rate for teenaged women (16.5%) in December. The rate for men ages 20-24
(12.1%) was slightly higher than the rate for women of the same age (10.1%). The large

18
See https://www.bls.gov/news.release/empsit.t15.htm for U-6 unemployment rates, a measure of the total
unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic
reasons, as a percentage of the civilian labor force plus all persons marginally attached to the labor force. For more on
this measure, see CRS In Focus IF10443, Introduction to U.S. Economy: Unemployment, by Lida R. Weinstock.

Congressional Research Service 7
Unemployment Rates During the COVID-19 Pandemic: In Brief

disparities observed in April between younger men and women were not observed in older age
groups, although women ages 25-54 and 55 and over had rates 1-3 percentage points high than
their male counterparts. This relatively modest gap has since narrowed; the rate in December for
women ages 25 to 54 (5.8%) equaled that of men (5.8%), and the rate for women ages 55 and
over (6.1%) was very similar to that of men (5.9%) from the same age group.

Figure 6. Monthly Unemployment Rates by Sex and Age
Seasonally adjusted data, January 2020 to December 2020

Source: Created by CRS using data from the Bureau of Labor Statistics (BLS).

Unemployment Rates by Racial Group and Hispanic Ethnicity
As seen in Figure 7, the unemployment rates for Black, Asian, and White19 workers increased
sharply in early 2020. But whereas the unemployment rate for White workers peaked in April, the
rate for Black and Asian workers continued to rise through May. The December rates for Black
(9.9%), Asian (5.9%), and White (6.0%) workers were all higher than their respective rates in
February 2020. The rate for Black workers has declined 6.9 percentage points since peaking in
May, compared to a decline of 9.1 percentage points for Asian workers and 6.4 percentage points
for White workers across the same period.

19 Asian, Black, and White are the three racial categories used in BLS, T able A2: Employment status of the civilian

population by race, sex, and age. See https://www.bls.gov/news.release/empsit.t02.htm.

Congressional Research Service 8
Unemployment Rates During the COVID-19 Pandemic: In Brief

Figure 7. Monthly Unemployment Rates by Racial Group
Seasonally adjusted data, January 2020 to December 2020

Source: Created by CRS using data from the Bureau of Labor Statistics (BLS).

People of any race can identify as being either Hispanic or non-Hispanic in the CPS. As seen in
Figure 8, Hispanic workers, like Black and Asian workers, have experienced strong negative
outcomes during the current recession. For Hispanic workers, unemployment increased by 13.7
percentage points to 18.9% from February to April 2020. For non-Hispanic workers the
unemployment rate increased by 10 points to 13.6%. These conditions have partially improved, as
Hispanic workers experienced an unemployment rate of 9.2% in December, compared to 5.9%
for non-Hispanics.

Figure 8. Monthly Unemployment Rates by Hispanic Origin
Non-seasonally adjusted data, January to December, 2019 and 2020

Source: Created by CRS using data from the Bureau of Labor Statistics (BLS).
Notes: Due to the lack of seasonal adjustment for these data, the 2020 unemployment rates for the Hispanic
and non-Hispanic groups are compared to their non-seasonally adjusted values from 2019. Statistical significance
is not calculated because BLS does not provide formula parameters for non -Hispanic workers.

Congressional Research Service 9
Unemployment Rates During the COVID-19 Pandemic: In Brief

Unemployment Rates by Education
In general, workers with lower levels of educational attainment have higher rates of
unemployment. This pattern has been amplified during the current recession, as seen in Figure 9.
The unemployment rate for workers with less than a high school diploma peaked in April 2020
(21.2%), which was higher than the peak for all other education levels. The December rate for
workers with less than a high school diploma (9.8%) was also higher than the rate for all other
education levels. Workers with a Bachelor’s degree or higher, the highest educational level
classified here, had the lowest peak unemployment rate (8.4% in April) and the lowest December
rate (3.8%) among all education levels.

Figure 9. Unemployment Rates by Education
Seasonally adjusted monthly data, January to December 2020

Source: Created by CRS using data from the Bureau of Labor Statistics (BLS).

Data Limitations and Caveats
National level data presented in this report are from the CPS and state level data are from the
LAUS program. The CPS is a sample survey of about 60,000 households conducted by the
Census Bureau for BLS. LAUS is a BLS program that calculates state-level unemployment rates
using multiple data sources, including the CPS. 20

20 In addition to the CPS, LAUS uses the Current Employment Statistics survey, state Unemployment Insurance claims

counts, the Quarterly Census of Employment and Wages program, and data from the Census Bureau’s American
Community Survey and Population Estimates Program; https://www.bls.gov/lau/laumthd.htm.

Congressional Research Service 10
Unemployment Rates During the COVID-19 Pandemic: In Brief

Both the CPS and LAUS estimates are subject to sampling and non-sampling error. 21 Sampling
error occurs when the survey sample is not representative of the underlying population, while
non-sampling error describes errors often associated with data collection. 22 Sampling error is a
result of statistical theory that underlies any estimate generated through surveys. While the CPS
sample is selected to be representative of the nation, the possibility remains that it does not
accurately estimate certain nationwide statistics. 23 Non-sampling error refers to all sources of
error that are not due to sampling. They can result from incorrect or biased collection and
processing of the data. For example, non-sampling error can occur if a surveyor incorrectly
records responses or a respondent incorrectly responds to a question.

COVID-19-Related Data Issues
The COVID-19 pandemic increased non-sampling error in the CPS due to a number of factors.
For example, BLS reported that the survey experienced lower household response rates. 24 (The
bureau has made statements affirming the robustness of its estimates despite these lower response
rates. 25 ) Furthermore, BLS detected an error in its categorization procedures that likely
underestimated unemployment early in the recession. 26 Specifically, large numbers of workers
were classified as employed but not at work when they should have been recorded as unemployed
on temporary layoff.
Per agency policy, BLS did not adjust CPS records, but it did provide adjusted estimates of the
unemployment rate. BLS estimated that its categorization error underestimated seasonally
adjusted unemployment by roughly 0.9 percentage points in March 2020, 4.8 points in April, 3.1
in May, 1.2 in June, 0.9 in July, 0.7 in August, 0.4 in September, 0.3 in October, 0.4 in November,
and 0.6 in December. These estimates evaluate what the impact would be in the worst-case
scenario, as the true impact is uncertain. BLS released a statement regarding the underestimate,
noting that, “these assumptions probably overstate the size of the misclassification error.”27 In
later months, BLS made efforts to correct this classification error during data collection and
processing. 28
LAUS was impacted by both the low response rate and the categorization error due to its
connection with the CPS. Considering that LAUS is dependent on a number of other data sources
that were impacted by COVID-19 in their own right, the net effect of the pandemic on LAUS
estimates is unknown. 29

21 For further discussion of error, see the “Reliability of the Estimates” section of the Employment Situation report’s

T echnical Note at https://www.bls.gov/news.release/empsit.tn.htm. For a description of LAUS estimation procedures,
see https://www.bls.gov/lau/laumthd.htm.
22 For more information, see https://www.bls.gov/opub/hom/topic/error-measurements.htm.

23 For more information, see https://www.bls.gov/opub/hom/topic/sampling.htm.

24 See the FAQ BLS produced on this topic for more on the impact of COVID-19 on data collection by month at

https://www.bls.gov/covid19/home.htm.
25 See https://www.bls.gov/covid19/employment -situation-covid19-faq-april-2020.htm.

26
See CRS Insight IN11456, COVID-19: Measuring Unemployment, by Lida R. Weinstock.
27 See https://www.bls.gov/covid19/employment -situation-covid19-faq-december-2020.htm#ques5.

28 Among other protocols, the Census Bureau monitored survey resp onses in August and marked those they felt could

be misclassified. T hese responses were then re-evaluated. For more on BLS and Census efforts to reduce the
misclassification, see https://www.bls.gov/covid19/employment -situation-covid19-faq-august-2020.htm#ques9.
29 For more on the impacts of COVID-19 on LAUS and its inputs, see https://www.bls.gov/covid19/effects-of-covid-

19-pandemic-on-employment-and-unemployment-statistics.htm.

Congressional Research Service 11
Unemployment Rates During the COVID-19 Pandemic: In Brief

General Data Caveats
Other data considerations include the following:
 Lack of seasonally adjusted data: Seasonally adjusted data are published by BLS
for selected labor force indicators to better account for seasonality in the trends. 30
Without seasonal adjustments, it is difficult to distinguish between trends related
to the recession and seasonal trends. Where adjusted data are not available, this
report compares year-over-year estimates to minimize seasonal influences.
 Reference week: In general, CPS data are collected for the calendar week
containing the 12th of the month. This could lead to incongruity between actual
labor force conditions over the course of a month and the conditions observed.
 CPS and LAUS comparability: While the LAUS program uses the same
unemployment concepts as the CPS and uses the CPS as an input, LAUS
estimates are based on multiple sources (including administrative data).
Consequently, CPS and LAUS estimates are not directly comparable.
 Statistical significance: CRS used BLS formulas to calculate year-over-year
statistical significance in changes in monthly data. As a tool, statistical
significance does not guarantee that year-over-year changes were meaningful.

30 See CPS and LAUS documentation for more on seasonal adjustment at https://www.bls.gov/cps/seasonal-

adjustment-methodology.htm and https://www.bls.gov/lau/lauseas.htm.

Congressional Research Service 12
Unemployment Rates During the COVID-19 Pandemic: In Brief

Author Information

Gene Falk, Coordinator Emma C. Nyhof
Specialist in Social Policy Research Assistant

Jameson A. Carter Paul D. Romero
Research Assistant Research Assistant

Isaac A. Nicchitta
Research Assistant

Acknowledgments
The four Research Assistants in CRS’s Domestic Social Policy Division were responsible for the analysis
and writing of this report, under the guidance of Gene Falk, Specialist in Social Policy. Questions from
congressional staff should be directed to Mr. Falk.

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
shared staff to congressional committees and Members of Congress. It operates solely at the behest of and
under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other
than public understanding of information that has been provided by CRS to Members of Congress in
connection with CRS’s institutional role. CRS Reports, as a work of the United States Government, are not
subject to copyright protection in the United States. Any CRS Report may be reproduced and distributed in
its entirety without permission from CRS. However, as a CRS Report may include copyrighted images or
material from a third party, you may need to obtain the permission of the copyright holder if you wish to
copy or otherwise use copyrighted material.

Congressional Research Service R46554 · VERSION 6 · UPDATED 13

File and source

File: R46554.6.pdf
Size: 1,879,046 bytes
SHA-256: 164ded4eff7cf399fd3a92c79bd1015df48098c93de6843f3eebaa162316d380
Our copy: R46554.6.pdf
Original: crsreports.congress.gov