The second paragraph in the Bureau of Labor Statistics Employment Situation Summary for February says it all:

The unemployment rate edged down to 7.7 percent in February but has shown 
little movement, on net, since September 2012. The number of unemployed 
persons, at 12.0 million, also edged lower in February.

While the unemployment rate dropped two-tenths of a percent from January, fewer people are working. As the report goes on to tout 236,000 jobs added one wonders how fewer people could be working and the number of people having jobs could go up?

The easy answer is two different sets of numbers make of the BLS report: the Household Survey and the Establishment Survey.

The Household survey counts the following in its numbers:

– Agriculture and related employment;
– Uncompensated Workers;
– Part Time Workers;
– Unpaid Family Employees;
– Workers absent without pay from their jobs;
– Self employed, Work-at-home Contractors;

The Establishment survey counts none of that in its numbers.

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