Prison labour isn't common in the UK, we prefer to turn our prisoners into either drug addicts or more skilled criminals.
I've seen estimates for the US prison labour population as being around 100,000. I don't know if that could be said to represent a an impact on the accuracy of the "employment rate" figures.
Plus I see no reason whatsoever to not use the real population number as denominator here.
Or to ask bluntly, 1.3% = how many men?
I still see no reason not to stick with the real population numbers.