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Technical Note
The estimates in this release were obtained from the Current Population
Survey (CPS), which provides the basic information on the labor force,
employment, and unemployment. The survey is conducted monthly for the
Bureau of Labor Statistics by the U.S. Census Bureau from a scientifically
selected national sample of about 60,000 households, with coverage in all
50 states and the District of Columbia. The earnings data are collected
from one-quarter of the CPS monthly sample and are limited to wages and
salaries. The data, therefore, exclude self-employment income.
Information in this release will be made available to sensory impaired
individuals upon request. Voice phone: (202) 691-5200; TDD message referral
phone number: 1-800-877-8339.
Reliability
Statistics based on the CPS are subject to both sampling and nonsampling
error. When a sample, rather than the entire population, is surveyed, there
is a chance that the sample estimates may differ from the "true" population
values they represent. The exact difference, or sampling error, varies de-
pending on the particular sample selected, and this variability is measured
by the standard error of the estimate. There is about a 90-percent chance,
or level of confidence, that an estimate based on a sample will differ by no
more than 1.6 standard errors from the "true" population value because of
sampling error. BLS analyses are generally conducted at the 90-percent level
of confidence.
The CPS data also are affected by nonsampling error. Nonsampling error
can occur for many reasons, including the failure to sample a segment of the
population, inability to obtain information for all respondents in the sample,
inability or unwillingness of respondents to provide correct information, and
errors made in the collection or processing of the data.
For a full discussion of the reliability of data from the CPS and informa-
tion on estimating standard errors, see the Household Data section of the
"Explanatory Notes and Estimates of Error" at http://www.bls.gov/cps/eetech_
methods.pdf.
Definitions
The principal definitions used in connection with the earnings series are
described briefly below.
Usual weekly earnings. Data represent earnings before taxes and other
deductions and include any overtime pay, commissions, or tips usually
received (at the main job in the case of multiple jobholders.) Prior to
1994, respondents were asked how much they usually earned per week. Since
January 1994, respondents have been asked to identify the easiest way for
them to report earnings (hourly, weekly, biweekly, twice monthly, monthly,
annually, other) and how much they usually earn in the reported time period.
Earnings reported on a basis other than weekly are converted to a weekly
equivalent. The term "usual" is as perceived by the respondent. If the
respondent asks for a definition of usual, interviewers are instructed to
define the term as more than half the weeks worked during the past 4 or
5 months.
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Medians (and other quantiles) of weekly earnings. The median (or upper
limit of the second quartile) is the amount which divides a given earnings
distribution into two equal groups, one having earnings above the median
and the other having earnings below the median. Ten percent of a given
distribution have earnings below the upper limit of the first decile (90
percent have higher earnings); 25 percent have earnings below the upper
limit of the first quartile (75 percent have higher earnings); 75 percent
have earnings below the upper limit of the third quartile (25 percent have
higher earnings); and 90 percent have earnings below the upper limit of the
ninth decile (10 percent have higher earnings).
The estimating procedure places each reported or calculated weekly
earnings value into $50-wide intervals which are centered around multiples
of $50. The actual value is estimated through the linear interpolation of
the interval in which the quantile boundary lies.
Over-the-year changes in the medians (and other quantile boundaries)
for specific groups may not necessarily be consistent with the movements
estimated for the overall quantile boundary. The most common reasons for
this possible anomaly are: (1) There could be a change in the relative
weights of the subgroups. For example, the medians of both 16-to-24 year
olds and those 25 years and over may rise; but if the lower-earning 16-to-
24 group accounts for a greatly increased share of the total, the overall
median could actually fall. (2) There could be a large change in the shape
of the distribution of reported earnings, particularly near a quantile
boundary. This could be caused by survey observations that are clustered
at rounded values, such as $250, $300, $400. An estimate lying in a $50-wide
centered interval containing such a cluster or "spike" tends to change more
slowly than one in other intervals.
Wage and salary workers. Workers who receive wages, salaries, commissions,
tips, payment in kind, or piece rates. The group includes employees in both
the private and public sectors but, for the purposes of the earnings series,
excludes all self-employed persons, regardless of whether or not their busi-
nesses are incorporated.
Full-time workers. Workers who usually work 35 hours or more per week at
their sole or principal job.
Part-time workers. Workers who usually work fewer than 35 hours per week
at their sole or principal job.
Constant dollars. The Consumer Price Index for All Urban Consumers (CPI-U)
is used to convert current dollars to constant (1982) dollars.
Hispanic or Latino ethnicity. Refers to persons who identified themselves
in the enumeration process as being Spanish, Hispanic, or Latino. Persons
whose ethnicity is identified as Hispanic or Latino may be of any race.
Bureau of Labor Statistics
