Extending jobless benefits could inflate the official unemployment rate — even though more people aren’t out of work.

The government’s unemployment rate counts only workers who say they’re looking for work. To qualify for benefits, a person has to say he or she is looking for work. When benefits were less generous – or simply unavailable – more jobless workers indicated that they had given up looking, and thus weren’t officially counted as unemployed.

Michael Feroli, a J.P. Morgan Chase Bank economist, says this phenomenon may have boosted the reported unemployment rate by 1.5 percentage points.

Internal Federal Reserve estimates suggest the boost is as much as one percentage point, sparking a debate inside the Fed over whether the official unemployment rate actually overstates the amount of slack in the economy compared to past recessions. But there is no consensus.

“The several extensions of emergency unemployment insurance benefits appeared to have raised the measured unemployment rate, relative to levels recorded in past downturns, by encouraging some who have lost their jobs to remain in the labor force,” according to Federal Open Market Committee minutes from its January meeting.

Some Fed officials warn that comparing the current official unemployment rate to recent history may be misleading and could lead the Fed to overestimate the amount of slack in the economy. The more idle workers in an economy, the less upward press on prices on wages. If there’s actually less slack in the economy than it appears from official measures, the Fed could end up tolerating more inflation than it realizes, these officials argue.