The employment report for May from the U.S. Bureau of Labor Statistics presented some potentially troubling signals.

First, it must be noted the two favorite takeaways from this report are in obvious contradiction. Total nonfarm payroll employment increased by 339,000 in May while the unemployment rate rose by 0.3 percentage points to 3.7 percent.

Hmmm. So, we experienced strong employment growth, but the jobless rate increased? What’s the deal?

The monthly employment report includes data from two surveys. The establishment survey provides payroll numbers, while the household survey results are used to calculate not only the unemployment rate, but also the far more important labor force participation rate and employment-population ratio.

While the unemployment rate actually is a dicey measure for a variety of reasons, the results in this case are pretty straightforward and stand in direct contradiction to the establishment survey. According to the household survey, employment in May declined 310,000, with the employment-population ratio dropping slightly from 60.4 percent in April to 60.3 percent in May.

While we’ll have to wait and see which survey might point in the right direction regarding the labor market, it’s worth remembering the household survey better captures small business and startup activity. That leads us to look at the latest data on self-employment in this survey.

The self-employed numbers in the monthly report capture people who say self-employment is their main work. They’re effectively full-time entrepreneurs. These entrepreneurs can have employees or not and are either unincorporated or incorporated.

Since the data are seasonally adjusted, we can look at the numbers for the unincorporated self-employed month to month. For three consecutive months, the number of unincorporated self-employed have declined — from 10.119 million in February to 9.403 million in May. The May 2023 level was the lowest since the depths of the pandemic.

Numbers for the incorporated self-employed aren’t seasonally adjusted, so need to look back to the same time last year. Incorporated self-employed registered 6.823 million in May 2022 and fell to 6.706 million in May 2023. For three months in a row, the number of incorporated self-employed were down from a year earlier.

If we add in the unincorporated data, total self-employment decreased from 17.034 million in May 2022 to 16.22 million in May 2023.

The household survey in May gives us plenty to be concerned about regarding employment and entrepreneurship. Hopefully, these matters will turn around in coming months — although the White House and Congress are doing nothing to aid matters on the policy front to encourage investment, risk taking and entrepreneurship.

Raymond Keating is chief economist for the Small Business & Entrepreneurship Council. The nonpartisan, nonprofit advocacy, education and research organization works to protect small business and promote entrepreneurship. For additional information, log on to the website at www.sbecouncil.org.