Project-wide Javascript/TypeScript language error from built-in language extension

Question

I am getting the following error in VSCode whenever I open my workspace.

To enable project-wide JavaScript/TypeScript language features, exclude large folders with source files that you do not work on. 
Source: TypeScript and Javascript Language Feat... [BUTTON: CONFIGURE EXCLUDES]

I click the Configure Excludes button on the message and it opens the following file FRONTENDAPP/jsconfig.json

{"compilerOptions":{"target":"es6","experimentalDecorators":true},"exclude":["node_modules","bower_components","tmp","vendor",".git","dist"]}

It looks to me that is configured correctly according to the documentation below. : https://code.visualstudio.com/docs/languages/javascript

So why the error all the time?

My Workspace is setup as follows:

FOLDER: NOTES
FOLDER: FRONTENDAPP
FOLDER: BACKENDAPP

Each folder as a jsconfig.json file.

The respective file in the NOTES and BACKENDAPP is the same and looks as follows:

{"compilerOptions":{"target":"es6","experimentalDecorators":true},"exclude":["node_modules","bower_components","tmp","vendor",".git","dist"]}

Answer 1

I had the same issues and I realized:

1. I had node_modules in subfolders
2. I had copies of dist (like dist1, dist2) for debugging, which where gitignored but not vscode ignored.
3. I had .npm and .npm-tmp folders with a lot of stuff inside.
4. Apart from dist I also had another tmp folder .app-cache.

I ended up with the following entry in /jsconfig.json (slightly redundant for readability) to make the warning go away:

  "exclude": [
    ".git",
    ".app-cache",
    ".npm",
    ".npm-tmp",
    "dist",
    "dist*",
    "node_modules",
    "subfolder/dist",
    "subfolder/node_modules",
    "**/dist/*",
    "**/node_modules/*",
  ]
}

Answer 2

Identify folders with lots of files: du -a | cut -d/ -f2 | sort | uniq -c | sort -nr

162114 node_modules
5837 .git
4967 concat-stats-for
 443 app
  77 tests
  72 dist
   8 config
   7 public

Check folders that aren't excluded in jsconfig.json for JS and TS files

find concat-stats-for -type f | sed -e 's/.*\.//' | sort | uniq -c | sort -n | grep -Ei '(js|ts)$'

  42 ts
3003 js

If the folder isn't App code, add said folder to jsconfig.json exclude.