No, pass rates DO NOT include those that signed up and do not sit.
From the CFA Institute “Our Fifth Decade” paper
"Pass rates are calculated from those candidates who actually sat for the examination. Approximately 25 percent of enrolled candidates who register do not sit for the examination (are no-shows) each year."
So, it’s an “economic but not material” difference. That is, the effects might be observable, but you are not going to behave differently due to these different numbers, right? It’s not like you will study more/less after reading this.
At this point right now, if I knew pass rates were in fact 60% instead of 38%, I would feel pretty relaxed and confident that I’ll be part of the 60% group, I would keep brushing up and doing practice exams, but would just be gliding towards the finish line. As it stands though, the fact that it’s only 38% makes me nervous and feeling I need to keep studying hard.
Probably not the greatest attitude, but my aim is to do the least amount of work that allows me to pass this exam. That’s not to say that I’m being lazy, I just don’t want to do 500 hours of studying when all I really need to do is 250.