Income Data for Policy Analysis: A Comparative Assessment of Eight Surveys. Persons with Earned Income

12/23/2008

Table IV.14 provides comparative estimates of persons with calendar year 2002 earnings, broken down by the source of earnings:  wages and salaries versus self-employment income. A person may have had both wage and salary income and self-employment income during the year, so in addition to showing the number of persons with any amount of either source, the table breaks down the population of earners into those with only wages and salaries, those with only self-employment income, and those with both.

TABLE IV.13

ESTIMATES OF POOR AND NEAR-POOR ELDERLY:PSID AND CENSUS BUREAU SURVEYS
Population Subgroup CPS ACS SIPP PSID CPS-X1
Millions of Persons
All Persons 65 and Older 34.22 33.56 33.95 29.95 33.94
Poverty Status
Poor 3.58 3.20 3.03 2.65 3.49
Near Poor 9.58 7.98 8.56 5.44 9.49
Total Low Income 13.16 11.18 11.59 8.10 12.98

 

ESTIMATES OF POOR AND NEAR-POOR ELDERLY:PSID AND CENSUS BUREAU SURVEYS(continued)
Population Subgroup CPS ACS SIPP PSID CPS-X1
Percent of the Population
All Persons 65 and Older 100.0 100.0 100.0 100.0 100.0
Poverty Status
Poor 10.5 9.5 8.9 8.9 10.3
Near Poor 28.0 23.8 25.2 18.2 28.0
Total Low Income 38.5 33.3 34.1 27.0 38.2

Source:   Mathematica Policy Research, from tabulations of poverty status in calendar year 2002 from the 2003 CPS ASEC supplement, the 2001 SIPP panel, the 2002 Full-year Consolidated MEPS-HC, and the 2003 NHIS, and poverty status in the prior 12 months, inflation-adjusted to calendar year 2002, from the 2002 ACS. Note: The poor have a family income below the poverty threshold.  The near poor have a family income at or above the poverty threshold but below twice the poverty threshold.  

1.The CPS-X estimates exclude all unrelated subfamilies and most secondary individuals (except unmarried partners of the householder) to mimic the population controls applied to the PSID.

TABLE IV.14

PERSONS WITH EARNINGS BY SOURCE: FIVE SURVEYS
Employment CPS ACS SIPP MEPS NHIS
Millions of Persons
Persons with Earnings 150.4 151.9 154.1 160.4 147.4
Persons with Wages and Salaries 141.5 142.4 140.4 NA NA
Persons with Self-employment Income 13.3 14.5 20.1 NA NA
Persons with negative SE income 1.2 0.7 0.0 NA NA
Persons with positive SE income 12.1 13.8 20.1 NA NA
Persons with Only Wages and Salaries 137.1 137.4 134.0 NA NA
Persons with Only Self-employment Income 8.9 9.6 13.7 NA NA
Persons with Both Wages and Salariesand Self-employment Income 4.4 5.0 6.4 NA NA

 

PERSONS WITH EARNINGS BY SOURCE: FIVE SURVEYS (continued)
Employment CPS ACS SIPP MEPS NHIS
Percent of the Population
Persons with Earnings 53.2 54.7 54.8 56.6 51.9
Persons with Wages and Salaries 50.1 51.3 49.9 NA NA
Persons with Self-employment Income 4.7 5.2 7.1 NA NA
Persons with negative SE income 0.4 0.3 0.0 NA NA
Persons with positive SE income 4.3 5.0 7.1 NA NA
Persons with Only Wages and Salaries 48.5 49.5 47.7 NA NA
Persons with Only Self-employment Income 3.2 3.4 4.9 NA NA
Persons with Both Wages and Salariesand Self-employment Income 1.6 1.8 2.3 NA NA

Source:   Mathematica Policy Research, from tabulations of calendar year 2002 income from the 2003 CPS ASEC supplement, the 2001 SIPP panel, the 2002 Full-year Consolidated MEPS-HC, and the 2003 NHIS, and prior 12 months income, inflation-adjusted to calendar year 2002, from the 2002 ACS.

Because more than half of the total population has income from employment, estimates of persons with earnings are affected by differences in population size across the surveys. In particular, the 5 million fewer persons represented in the estimates from the ACS versus the CPS would imply 2.5 million fewer earners in the ACS than the CPS if the percentages of persons employed were identical in the two surveys. Therefore, the bottom half of Table IV.14 expresses each category of earners as percentages of the total population.

While the CPS is the official source of monthly labor force estimates, the ACS, SIPP, and MEPS all find both numerically and proportionately more persons with reported earnings in 2002 than the CPS. While the CPS identifies 150.4 million persons with earnings, or 53.2 percent of the population, the estimates from these other surveys range from 151.9 million (or 54.7 percent) in the ACS to 154.1 million (or 54.8 percent) in SIPP and 160.4 million (or 56.6 percent) in MEPS. The NHIS finds the fewest, at 147.4 million or 51.9 percent of the population, but this can be attributed to the fact that the NHIS does not collect earnings data from persons under 18. The 150.4 million earners reported in the CPS include 3.4 million who were under 18. Removing these from the CPS would yield 147.0 million earners, which is slightly lower than the NHIS estimate.

Estimates of persons with wage and salary income are very similar across the three Census Bureau surveys, with the ACS about a million above the CPS estimate of 141.5 million and the SIPP about a million below that number.30 While the three surveys identify very similar numbers of persons with both wages and salaries and self-employment income (estimates range from 4.4 to 6.4 million), differences in the numbers with only self-employment income are striking. The CPS and ACS find between 9 and 10 million while SIPP finds 13.7 million.31

Average annual earnings per worker range from a low of $30,899 in SIPP to a high of $35,707 in the NHIS, with the CPS just below that at $35,591 (Table IV.15).  ACS lies closer to CPS than to SIPP, with average earnings of $34,279 while MEPS is closer to SIPP at $32,813. Estimates of average wages and salaries in the Census Bureau surveys are consistent with this ordering. SIPP is lowest at $29,514, and the CPS is highest at $35,514, with ACS at $33,837. The average wage and salary income for workers in the SIPP is only 83 percent of the CPS average. SIPP finds the highest average annual self-employment income, however, at $30,755 or 25 percent higher than the CPS average of $24,670. The ACS estimate lies between the CPS and SIPP at $26,893.

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