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INCOME AND EARNINGS
CURRENT POPULATION SURVEY
Measure: Current Population Survey questions about earnings in Basic Monthly Survey and about income and earnings in the Annual Social and Economic Supplement
Source
The Current Population Survey (CPS) is co-sponsored by the Bureau of Labor Statistics (BLS) and the U.S. Census Bureau. The Census Bureau administers the survey. The forerunner for the basic CPS, the Sample Survey of Unemployment, had been initially developed by the Work Projects Administration in the late 1930s, with a first administration in 1940; the Census Bureau assumed responsibility in 1942. The origins of an annual income supplement date from 1948. In 2003, this supplement changed its name from the Annual Demographic Survey to the Annual Social and Economic Supplement (ASEC).
The CPS basic monthly survey is also used as a section in the youth questionnaire of Rounds 1 and 4 of the NLSY97.
Population Assessed
“The CPS is the primary source of information on the labor force characteristics of the U.S. population. The sample is scientifically selected to represent the civilian noninstitutional population. Respondents are interviewed to obtain information about the employment status of each member of the household 15 years of age and older. However, published data focus on those ages 16 and over. The sample provides estimates for the nation as a whole and serves as part of model-based estimates for individual states and other geographic areas” (http://www.bls.census.gov/cps/bovrvw1.htm). The basic monthly survey does not include members of the armed forces, but the ASEC collects data for military personnel if they are living with at least one civilian adult. Earnings questions on the basic CPS are asked to employed wage and salary workers.
Because the housing unit is the sampling unit, all people 15 and older currently living in the housing unit are surveyed in each month the housing unit is in the sample (see Periodicity), even if they are new to the housing unit. People who move out of the housing unit are no longer followed; if the original residents of a housing unit move out while that unit is still in rotation, the new residents of the unit will be surveyed in subsequent months instead.
The basic CPS consists of a sample of about 60,000 occupied housing units and all eligible residents within them. The ASEC surveys the 60,000 occupied housing units scheduled to receive the monthly survey in March as well as two additional groups of people: 1) 4,500 Hispanic households identified the previous November (so as to improve Hispanic estimates of ASEC constructs) and 2) 34,500 households who form what is known as the State Children’s Health Insurance Program sample expansion. The latter expansion, designed to allow the ASEC to better measure the number of children in each state without health insurance coverage, involves oversampling non-Hispanic non-White households, non-Hispanic White households with children younger than 19, and households in states whose estimates of children’s health insurance coverage were the most unreliable. In total, then, the ASEC sample includes about 99,000 households. But since many of the 39,000 additional housing units are found to be permanently ineligible (Type C) or temporarily ineligible (Type B) or do not complete the basic CPS for that month, the actual number of eligible households added for the ASEC is only about 21,000. (The sample size of 60,000 for the basic CPS also excludes Type B and C households.)
Additional weighting is performed so that estimates for households and families, as well as persons can be made (http://www.bls.census.gov/cps/ads/adsdes.htm).
Periodicity
Respondents to the CPS are surveyed eight times: two periods of four consecutive months one calendar year apart. (There are thus eight months between the fourth and fifth survey of each household.) Questions on earnings are asked in only the fourth and eighth (final) month that a housing unit is in the sample, in what are known as the outgoing rotation groups. Questions in the ASEC are asked once a year, primarily in March, although certain households in the expanded sample are interviewed in February or April. Administration of the basic CPS and ASEC according to this regular schedule is ongoing.
Components
The Basic Monthly Survey does not have formal sections; it does, though, have a distinct earnings component in which the survey inquires about how much the respondent and every eligible member of his or her household earns (including overtime pay, tips, or commissions) in their main job. The survey then clarifies whether a household member is paid at an hourly rate (and, if so, what the amount is). One question is also included about total family income, in which the respondent picks from a listing of income categories.
The Annual Social and Economic Supplement contains numerous sections, each addressing a specific type of cash or non-cash source of income. These sections are Earned Income, Unemployment and Worker’s Compensation, Social Security, Social Security for Children, Supplemental Security Income, Supplemental Security Income for Children, Public Assistance, Veterans’ Payments, Survivor Benefits, Disability Income, Retirement and Pensions, Interest, Dividends, Property Income, Education Assistance, Child Support and Alimony, Regular Financial Assistance, Other Money Income, Health Insurance, Employer’s Pension Plan, School Lunches, Public Housing, Food Stamps, Energy Assistance, and New Welfare Reform. Most of these sections are, in turn, divided into separate subcategories of income. The Unemployment and Worker’s Compensation section, for example, asks separately about state or federal unemployment compensation, supplemental unemployment benefits, union unemployment or strike benefits, and worker’s compensation (with the respondent identifying the source of worker’s compensation). New Welfare Reform looks at a number of kinds of non-cash income, including transportation assistance, child care services or assistance, educational assistance, job-training assistance, and job-search assistance. The survey inquires which household member(s) received each of these sources of income; dollar amounts are then recorded for each source for each household member individually. The goal is to determine income from each source for the year, but the respondent is almost always given the option of presenting dollar amounts in whatever time duration is easiest. Dollar values (or the equivalent) for this income are specifically asked for all income types except health insurance, employer’s pension plan, school lunches, public housing, and new welfare reform. When a section (like Unemployment and Workers Compensation, Veterans Payments, Disability Income, and Retirement and Pensions) inquires about receipt of different types of income in that category, amounts are recorded for each subcategory of income separately.
Procedures for Administration
One person (the household respondent) usually answers for all members of the household; however, telephone call-backs are commonly done to obtain pieces of information known only by someone else in the household. Roughly 50 percent of all labor-force information collected in the basic CPS comes from proxy reporting (BLS and Census, 2002, p. 16–10).
The first and fifth interviews for the basic monthly survey are conducted through computer-assisted personal interviewing (CAPI). Over 90 percent of interviews for months 2–4 and 6–8 are accomplished via computer-assisted telephone interviewing (CATI), with the remainder conducted through CAPI for various reasons. As the February to April timeframe for conducting the ASEC could occur anywhere within the interviewing cycle, the mode of data collection for the ASEC could be either CAPI or CATI. The setting, whether interviews are conducted in person or by telephone, is one on one.
The monthly CPS survey takes an average of 6 minutes per household member. The ASEC averages 25 minutes.
Psychometrics/Data Quality
Item-level nonresponse (covering both refusals and “don’t know” answers) is much higher for earnings questions on the basic monthly survey than for any other item series. In 1994, fully 12.44 percent of CPS earnings items had missing data, compared to only 1.54 percent for demographic questions, 1.46 percent for labor force items, and 3.76 percent for industry and occupation questions (BLS and Census, 2002, p. 16–5). Imputation is done on missing income and earnings data in both the basic CPS and the ASEC, albeit by different methods. The basic CPS first uses longitudinal data for nonresponses. If none are available, then the basic monthly survey employs eight allocation matrices. The ASEC uses an algorithm based on a statistical match process that was devised by the staff of the Census Bureau’s Housing and Household Economic Statistics Division. For more information on CPS imputation methods, see Chapter 9 (pp. 9-1–9-3) of BLS and Census, 2002.
“The concept of coverage in the survey sampling process is the extent to which the total population that could be selected for sample ‘covers’ the survey’s target population. CPS undercoverage results from missed housing units and missed people within sample households. Overall CPS undercoverage for March 2003 is estimated to be about 11 percent. CPS undercoverage varies with age, sex, and race. Generally, undercoverage is larger for males than for females and larger for Blacks than for Non-Blacks” (U.S. Census Bureau, 2003, p. G-3). Coverage for Blacks is only about 83 percent (BLS and Census, 2002, p. 15–2). For more information on nonsampling errors, including both coverage ratios and nonresponse rates, see Chapter 16 of BLS and Census, 2002.
“Since [earnings] data [from the basic CPS] are collected from only one-fourth of the sample each month, these estimates are averaged over 3 months to improve their reliability, and published quarterly.” (BLS and Census, 2002, p. 10–12). For information on weighting data (including earnings data) from outgoing rotation groups, see pages 10-12–10-13 of BLS and Census, 2002.
As a measure of validity, Survey of Income and Program Participation (SIPP) and CPS income data were compared with data obtained from independent sources (often income tax returns and the National Income and Product Accounts). Looking at data from 1984 and 1990, both SIPP and ASEC estimates of aggregate income from various sources were consistently lower than values achieved from independent sources. The exact income types in which SIPP was higher than ASEC varied. For example, SIPP had higher estimated of number of welfare recipients, Supplemental Security Income, Social Security, and Railroad Retirement. ASEC had higher estimates for earnings. For more information (broken out by income source and other variables) on estimate comparisons between CPS, SIPP, and independent sources, see Kalton, Winglee, and Jabine, 1998, pp. 121–147.
Languages Available
The basic CPS can be administered in English and Spanish. The ASEC is only available in English.
Items Included
The questionnaire for the Basic Monthly Survey is available at http://www.bls.census.gov/cps/bqestair.htm. The questionnaire for the 2003 Annual Social and Economic Supplement can be found in Appendix D (D-1 to D-110) of U.S. Census Bureau, 2003, which is available at http://www.census.gov/apsd/techdoc/cps/cpsmar03.pdf. Sample items from the basic CPS and ASEC follow. (The first four basic CPS items, which are simplified to remove information from skip patterns, come from BLS and Census, 2002, p. 6–5. These questions would be asked about every eligible member of the household.) ASEC questions tend to follow a common pattern in that the same basic types of questions are asked to arrive at dollar amounts for most of the various sources of income. The straightforward questions about survivor benefits are a representative sample of the pattern. The first questions listed below are from ASEC’s section on earned income, the most important source of income for most people. At the end of the Items Included section are examples of other sources of income inquired about by the ASEC; most of these income sources are asked about in the same basic way as the survivor benefit questions. For a complete list of the general categories of income inquired about separately, see the Components section of this options document.
Basic Monthly Survey
For your (MAIN) job, what is the easiest way for you to report your total earnings BEFORE taxes or other deductions: hourly, weekly, annually, or on some other basis?
Do you usually receive overtime pay, tips, or commissions [at your MAIN job]?
[Including overtime pay, tips and commissions,] What are your usual [weekly, monthly, annual,
etc.] earnings on this job, before taxes or other deductions?
Even though you told me it is easier to report your earnings annually, are you PAID AT AN
HOURLY RATE on this job?’
I am going to read a list of income categories. Which category represents [your/name of reference
person/the total combined income] [total combined income during the past 12 months/of all
members of this FAMILY during the past 12 months]? This includes money from jobs, net
income from business, farm or rent, pensions, dividends, interest, social security payments and
any other money income received [by members of this FAMILY who are 15 years of age or
older.]
Less than $5,000
5,000 to 7,499
7,500 to 9,999
10,000 to 12,499
12,500 to 14,999
15,000 to 19,999
20,000 to 24,999
25,000 to 29,999
30,000 to 34,999
35,000 to 39,999
40,000 to 49,999
50,000 to 59,999
60,000 to 74,999
$75,000 or more
ANNUAL SOCIAL AND ECONOMIC SUPPLEMENT
Earned Income
[The first group of questions in the Earned Income section refers to the job at which the
household member has worked the longest in 2002; this job’s characteristics were described
at the end of the previous section (Work Experience).]
From Earned Income Section
Q48a@a. How much did (name/you) earn from this employer before taxes and other deductions
during 2002?
[READ IF NECESSARY]: Is this a weekly, every other week, twice a month, monthly or yearly
amount?
Q48a1. For how many [weekly/every other week/twice a month/monthly] pay periods did
[name/you] earn [fill from Q48a] from this employer in 2002?
Q48aC2. *** DO NOT READ TO THE RESPONDENT ***
THE ANNUAL RATE APPEARS OUT OF RANGE. THE TOTAL ANNUAL EARNINGS ENTERED IS [AMOUNT]. IS THIS A CORRECT ENTRY?
Q48aV. According to my calculations [name/you] earned [total] dollars altogether from this employer in 2002 before deductions. Does that sound about right?
Q48a2. What is your best estimate of [name’s/your] correct total amount of earnings from this employer during 2002 before deductions?
Q48a3. Does this amount include all tips, bonuses, overtime pay or commissions [name/you] may have received from this employer in 2002?
Q48aad. How much did [name/you] earn in tips, bonuses, overtime pay or commissions from this employer in 2002?
Q48b. What were [name’s/your] net earnings from this [business/farm] after expenses during 2002?
[IF RESPONSE IS “BROKE EVEN,” THEN ENTER 1.]
Q48BL. ENTER AMOUNT OF MONEY LOST IN 2002.
Q48bp. Is this an annual, quarterly, monthly, weekly, or other amount?
Q48b1. *** DO NOT READ TO THE RESPONDENT ***
THE ANNUAL RATE APPEARS OUT OF RANGE. THE TOTAL ANNUAL BUSINESS INCOME ENTERED IS [AMOUNT]. IS THIS A CORRECT ENTRY?
Q48b2. What is your best estimate of [name’s/your] ANNUAL net earnings from this business/farm after expenses in 2002?
Q48b2L. What is your best estimate of [name’s/your] ANNUAL net LOSS from this business/farm after expenses in 2002?
Q48b3. What were [name’s/your] net earnings from this [business/farm] during the FIRST quarter of 2002?
[IF RESPONSE IS “BROKE EVEN,” ENTER 1.]
Q48b3L. ENTER AMOUNT OF MONEY LOST IN THE FIRST QUARTER OF 2002.
[These questions are then repeated for the other three quarters of 2002.]
Q48b7. Does this amount include all tips, bonuses, overtime pay or commissions [name/you] may have received in 2002?
Q48bad. How much did [name/you] earn in tips, bonuses, overtime pay or commissions in 2002?
Q49a. Did [name/you] earn money from any other work [you/he/she] did during 2002?
Q49b. How much did [name/you] earn from all other employers before taxes and other deductions during 2002?
READ IF NECESSARY: Is this a weekly, every other week, twice a month, monthly or yearly amount?
Q49B11. For how many [weekly/every other week/twice a month/monthly] pay periods did [name/you] earn [fill from Q49B1] from all other employers in 2002?
Q49B1C. *** DO NOT READ TO THE RESPONDENT ***
THE TOTAL ANNUAL EARNINGS ENTERED FROM ALL OTHER EMPLOYERS IS [AMOUNT]. IS THIS A CORRECT ENTRY?
Q49B1V. According to my calculations [name/you] earned [total] dollars altogether from all other employers in 2002. Does that sound about right?
Q49B12. What is your best estimate of [name’s/your] correct total amount of earnings from all other employers during 2002?
Q49B13. Does this amount include all tips, bonuses, overtime pay or commissions [name/you] may have received from all other employers in 2002?
Q49B1A. How much did [name/you] earn in tips, bonuses, overtime pay or commissions from all other employers in 2002?
Q49@b2. How much did [name/you] earn from [his/her/your] own business after expenses?
IF RESPONSE IS “BROKE EVEN,” THEN ENTER 1.
FOR AMOUNTS $1,000,000 AND OVER [EARNED], ENTER $999,999.
ENTER ANNUAL AMOUNT ONLY.
Q49@b3. FOR AMOUNTS $10,000 AND OVER [LOST], ENTER $9,999.
ENTER ANNUAL AMOUNT LOST ONLY.
Q49b@4. How much did [name/you] earn from [his/her/your] farm after expenses?
IF RESPONSE IS “BROKE EVEN,” THEN ENTER 1.
FOR AMOUNTS $1,000,000 AND OVER [EARNED], ENTER $999,999.
ENTER ANNUAL AMOUNT ONLY.
Q49b@5. FOR AMOUNTS $10,000 AND OVER [LOST], ENTER $9,999.
ENTER ANNUAL AMOUNT LOST ONLY
EXAMPLE OF STRUCTURE OF QUESTIONS
From Survivor Benefits Section
Q58a. Did [you/anyone in this household] receive any survivor benefits in 2002 such as widow’s pensions, estates, trusts, insurance annuities, or any other survivor benefits, [other than Social Security/other than VA benefits/other than Social Security or VA benefits]?
Q58b@1. Who received this income?
PROBE: Anyone else?
Q58c@1. What was the source of this income?
ASKING ABOUT: [name] [blank/—CURRENT RESPONDENT]
Company or union survivor pension (include profit sharing)
Federal Government survivor (civil service) pension
U.S. Military retirement survivor pension
State/Local government survivor pension
U.S. Railroad retirement survivor pension
Worker’s compensation survivor pension
Black Lung survivor pension
Regular payments from estates or trusts
Regular payments from annuities or paid-up insurance policies
Other or don’t know (specify)—enter last
PROBE: Any other reason?
Q58E1p. What is the easiest way for you to tell us [name’s/your] [fill from first answer in Q58c@1 or Q58c@s1]; weekly, every other week, twice a month, monthly or yearly?
Q58E1. How much did [name/you] receive [weekly/every other week/twice a month/monthly] in [fill from first answer in Q58c@1 or Q58c@s1] in 2002?
Q58E12. How many [weekly/every other week/twice a month/monthly] payments did [name/you] receive in [fill from first answer in Q58c@1 or Q58c@s1] in 2002?
Q58E1C. *** DO NOT READ TO THE RESPONDENT ***
THE ANNUAL RATE APPEARS OUT OF RANGE. THE TOTAL [FILL FROM FIRST ANSWER IN Q58c@1 or Q58c@s1] PAYMENTS RECEIVED IN 2002 WAS [AMOUNT]. IS THIS A CORRECT ENTRY?
Yes
No
Q58E13. According to my calculations [name/you] received [total] dollars altogether from [fill from first answer in Q58c@1 or Q58c@s1] in 2002. Does that sound about right?
Q58E14. What is your best estimate of the correct amount [name\you] received from [fill from first answer in Q58c@1 or Q58c@s1] during 2002?
Q58E2p. What is the easiest way for you to tell us [name’s/your] [fill from second answer in Q58c@2 or Q58c@s1]; weekly, every other week, twice a month, monthly or yearly?
[These questions then repeat for additional types of survivor benefits received from anyone in the household.]
EXAMPLES OF OTHER TYPES OF INCOME ASKED ABOUT
From Unemployment and Workers Compensation Section
Q51A@1. At any time during 2002 did [names/you] receive any State or Federal unemployment compensation?
From Social Security Section
Q56a. During 2002 did [anyone in this household/you] receive any Social Security payments from the U.S. Government?
Q56d3. Is this [amount from Q56d/amount from Q56d1] before or after the [50.00/54.00] per month Medicare deduction?
Q56d4. Was the cost of living increase the only change which occurred in monthly [Social Security] payments?
SSR@1. What were the reasons [name/you] [was/were] getting Social Security in 2002?
MARK ALL THAT APPLY.
PROBE: Any other reason?
From Supplemental Security Income (SSI) Section
Q57a. During 2002 did [anyone in this household receive:/you receive:]
Any SSI payments, that is, Supplemental Security Income?
Note: SSI are assistance payments to low-income aged, blind and disabled persons and come from state or local welfare offices, the federal government, or both.
From Public Assistance Section
Q59A88. At any time during 2002, even for one month, did [anyone in this household/you] receive any CASH assistance from a state or county welfare program such as [State Program Name]?
INCLUDE CASH PAYMENTS FROM: WELFARE OR WELFARE TO WORK PROGRAMS, (STATE PROGRAM NAMES AND/OR ACRONYMS), TEMPORARY ASSISTANCE FOR NEEDY FAMILIES PROGRAM (TANF), AID TO FAMILIES WITH DEPENDENT CHILDREN (AFDC), GENERAL ASSISTANCE/EMERGENCY ASSISTANCE PROGRAM, DIVERSION PAYMENTS, REFUGEE CASH AND MEDICAL ASSISTANCE PROGRAM, GENERAL ASSISTANCE FROM BUREAU OF INDIAN AFFAIRS OR TRIBAL ADMINISTERED GENERAL ASSISTANCE.
DO NOT INCLUDE FOOD STAMPS, SSI, ENERGY ASSISTANCE, WIC, SCHOOL MEALS, OR TRANSPORTATION, CHILD CARE, RENTAL OR EDUCATION ASSISTANCE.
From Interest Section
Q63A@1. At anytime during 2002, did [you/anyone in this household]: Have money in any kind of money market fund, interest earning checking account, or savings account?
Q63A@2. Have any savings bonds?
Q63A@3. Have any treasury notes, IRAs, certificates of deposit, or any other investments which pay interest?
Q63c. How much did [name/you] receive in interest from these sources during 2002, including even small amounts reinvested or credited to accounts?
ONLY INCLUDE INTEREST RECEIVED FROM U. S. SAVINGS BONDS CASHED DURING 2002
SEPARATE AMOUNTS FOR JOINT OWNERSHIP
From Regular Financial Assistance Section
Q72a. blank/During 2002 did [anyone in this household receive:/you receive:] [Any other/Any] regular financial assistance from friends or relatives not living in this household?
From Other Money Income Section
DO NOT INCLUDE LOANS
Q73A1. During 2002, did [anyone in this household/you] receive income from hobbies, home businesses, farms, or business interests not already covered?
Q73A2. During 2002, did [anyone in this household/you] receive income from any severance pay, welfare, emergency assistance, other short-term cash assistance, foster child care payments, or any other money income not already covered?
From Health Insurance Section
SHI2. At any time in 2002, [were you/was anyone in this household] covered by a health plan provided through [their/your] current or former employer or union? [MILITARY HEALTH INSURANCE WILL BE COVERED LATER IN ANOTHER QUESTION.]
From School Lunches Section
Q83. During 2002 which of the children in this household received free or reduced price lunches because they qualified for the Federal School Lunch program?
From Food Stamps Section
Q90. What is the [monthly] value of food stamps received in 2002?
From New Welfare Reform Section
SWR1. At any time during 2002, did [you/anyone in this household] receive any of the following types of assistance from a state or county welfare agency or a case manager:
Transportation assistance to help [you/them] get to work or school or training, such as gas vouchers, bus passes, or help repairing a car?
From Additional Questions at the End of the Survey
Q96. Now, for the last few questions, we would like to get some CURRENT information. You said earlier that [no one in your household/someone in your household/you] received cash assistance from a state or county welfare program in 2002. WITHIN THE LAST 30 DAYS, did [anyone in this household/you] receive any CASH assistance from a state or county welfare program such as [State Program Name]?
References and Source Documents
Bureau of Labor Statistics & U.S. Census Bureau. (2002). Current Population Survey: Design and Methodology. Technical Paper 63RV. Washington, DC: Authors. URL: http://www.census.gov/prod/2002pubs/tp63rv.pdf
Kalton, G., Winglee, M., and Jabine, T. (1998). SIPP quality profile, 3rd ed. SIPP Working Paper
230. Washington, DC: U.S. Census Bureau. URL: http://www.sipp.census.gov/sipp/workpapr/wp230.pdf
U.S. Census Bureau. (2003). Current Population Survey, 2003 Annual Social and Economic (ASEC) Supplement. Technical documentation. Washington, DC: Author. URL: http://www.census.gov/apsd/techdoc/cps/cpsmar03.pdf
A data dictionary for the ASEC (updated as of 2001) is available for household, family, and person variables; the dictionary, located at http://www.bls.census.gov/cps/ads/sdatadic.htm, provides numeric codes for possible question responses and frequency distributions from the March 1995 survey.
Two different data dictionaries for the basic monthly survey are available: one that provides variable descriptions by topic at http://www.bls.census.gov/cps/bdatadic.htm and one for the public use file that lists variables in a variety of ways at http://www.bls.census.gov/cps/basic/datadict/199801/bdatdict.htm. Neither data dictionary for the basic CPS includes frequency distributions.
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