U S C E N S U S B U R E A U Helping You Make Informed Decisions •1902-2002 P60-218 Demographic Programs U.S. Department of Commerce Economics and Statistics Administration U.S. CENSUS BUREAU Money Income A in the United States: 2001 Issued September 2002 By Carmen DeNavas-Walt Robert W. Cleveland Current Population Reports Consumer Income
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U S C E N S U S B U R E A UHelping You Make Informed Decisions •1902-2002
P60-218
Demographic Programs
U.S.Department of CommerceEconomics and Statistics Administration
U.S. CENSUS BUREAU
Money Income Ain the United States: 2001 Issued September 2002
ByCarmen DeNavas-WaltRobert W. Cleveland
Current Population Reports
Consumer Income
P60
-21
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S C E N
S U S B
U R
E A U
Mon
ey In
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e Un
ited States: 2
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1 Cu
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tion
Rep
orts C
onsu
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come
U.S. Department of CommerceEconomics and Statistics AdministrationU.S. CENSUS BUREAUWashington, DC 20233
OFFICIAL BUSINESS
Penalty for Private Use $300
FIRST-CLASS MAILPOSTAGE & FEES PAIDU.S. Census Bureau
Permit No. G-58
AcknowledgmentsThe Housing and Household Economic Statistics Division of theCensus Bureau recognizes Shirley L. Smith for her 31 years ofservice with the Census Bureau. Ms. Smith spent the last 28years working on income data collected in current surveys andthree decennial censuses. One particularly noteworthy accom-plishment is the extensive series of historical tables availableon our web site. Her dedication, professionalism, and institu-tional knowledge will be sorely missed.
This report was prepared under the direction of Edward J. Welniak Jr., Chief of the Income Surveys Branch. Shane L. Martinmade significant contributions to the preparation of this report.Shirley L. Smith and Diana Marz provided statistical assistance.Ruth E. Davis and Doris Sansbury provided clerical assistance.Charles T. Nelson, Assistant Division Chief for Income, Poverty,and Health Statistics, Housing and Household Economic StatisticsDivision, provided overall direction.
David Nguyen and John Dinh, Demographic Surveys Division,processed the March 2002 Annual Demographic Supplement CurrentPopulation Survey file. Caroline S. Carbaugh, Chief of the SurveyProcessing Branch, Stacy J. Lyons, Mary Thrift Bush, and Kirk E.Davis programmed the detailed tables.
Aneesah Stephenson and Fred Meier of the DemographicStatistical Methods Division conducted sampling review.
Tim J. Marshall, Demographic Surveys Division, and Andrew M.Stevenson, Technologies Management Office, prepared and pro-grammed the computer-assisted interviewing instrument used toconduct the Annual Demographic Supplement.
U.S. Census Bureau field representatives and telephone interviewerscollected the data. Without their dedication, the preparation of thisreport or any report from the Current Population Survey would beimpossible.
Greg Carroll, Penny Heiston, Jan Sweeney, and Mary Stinsonof the Administrative and Customer Services Division, Walter C.Odom, Chief, provided publications and printing management,graphics design and composition, and editorial review for print andelectronic media. General direction and production managementwere provided by Gary J. Lauffer, Chief, Publications ServicesBranch.
Money Income in theUnited States: 2001
P60-218
Issued September 2002
U.S. Department of CommerceDonald L. Evans,
Secretary
Samuel W. Bodman,Deputy Secretary
Economics and Statistics AdministrationKathleen B. Cooper,
Under Secretary for Economic Affairs
U.S. CENSUS BUREAUCharles Louis Kincannon,
Director
Suggested Citation
DeNavas-Walt, Carmen and RobertCleveland, U.S. Census Bureau,
Current Population Reports, P60-218, Money Income in the United States:
2001, U.S. Government PrintingOffice, Washington, DC,
2002.
ECONOMICS
AND STATISTICS
ADMINISTRATION
Economics and StatisticsAdministration
Kathleen B. Cooper,Under Secretary for Economic Affairs
U.S. CENSUS BUREAU
Charles Louis Kincannon,Director
William G. Barron, Jr.,Deputy Director
Vacant,Principal Associate Director for Programs
Nancy M. Gordon,Associate Director for Demographic Programs
Daniel H. Weinberg,Chief, Housing and Household EconomicStatistics Division
For sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov Phone: toll-free 866-512-1800; DC area 202-512-1800
Fax: 202-512-2250 Mail: Stop SSOP, Washington, DC 20402-0001
U.S. Census Bureau Money Income in the United States: 2001 iii
iv Money Income in the United States: 2001 U.S. Census Bureau
Appendix B. SAMPLE EXPANSION AND INTRODUCTION OF CENSUS 2000-BASED POPULATION CONTROLS
B-1. Comparison of 2000 Median Income Using the Expanded Sample and the Original Sample by Selected Characteristics . . . . . . . . . . . . . . . . . . . . . . . . . . 25
B-2. Comparison of 2000 Median Income by State Using the Expanded Sample and the Original Sample . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
B-3. Comparison of 2000 Median Income Using Census 2000-Based Population Controls and 1990 Census-Based Population Controls by Selected Characteristics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
U.S. Census Bureau Money Income in the United States: 2001 1
Money Income in the United States: 2001
INTRODUCTION
The 2001 median householdincome in the United States was$42,228, representing a 2.2 per-cent decline in real income from its2000 level of $43,162.1 Thisdecline in income coincides withthe recession that started in March2001.2 The decline in medianhousehold income between 2000and 2001 was widespread. Withthe exception of the Northeast, allregions experienced a decline in
1 All income values are in 2001 dollars.Changes in real income refer to comparisonsafter adjusting for inflation. The percentagechanges in prices between earlier years and2001 were computed by dividing the annualaverage Consumer Price Index for 2001 bythe annual average for earlier years. TheCPI-U values for 1947 to 2001 are availableon the Internet at:www.census.gov/hhes/www/income01.html;click on “Annual Average Consumer PriceIndex (CPI-U-RS): 1947 to 2001.” Inflationbetween 2000 and 2001 was 2.8 percent.
2 Recessions are determined by theNational Bureau of Economic Research, a pri-vate research organization.
income. Each of the racial groupsand non-Hispanic Whites showeddeclines in income; the income ofthe Hispanic population remainedunchanged.3
HIGHLIGHTS
(Most of the estimates described inthis section are shown in Table 1,Table 2, Table 3, and AppendixTable A-1; the estimates for statesare shown in Table 4.)
• Real median household incomedeclined by 2.2 percent between2000 and 2001 to a level of$42,228.
3 Because Hispanics may be of any race,data in this report for Hispanics overlapslightly with data for the Black populationand the Asian and Pacific Islander popula-tion. About 10.9 percent of White house-holds, 3.0 percent of Black households, 2.0percent of Asian and Pacific Islander house-holds, and 13.1 percent of American Indianand Alaska Native households are main-tained by a person of Hispanic origin.
• The real median income of familyhouseholds and of nonfamilyhouseholds declined between2000 and 2001. Overall, familyhousehold income dropped 1.7percent to $52,275. Nonfamilyhouseholds experienced a declineof 1.5 percent, to $25,631.4
• Foreign-born households experi-enced a 5.3 percent decline inmedian income between 2000and 2001 (to $37,948), largerthan the 1.5 percent decline (to$42,917) experienced by nativehouseholds.5
4 The percent declines in median incomefor family and nonfamily households are notdifferent.
5 Native households are those in whichthe householder was born in the UnitedStates, Puerto Rico, or an outlying area ofthe United States or was born in a foreigncountry but had at least one parent who wasa U.S. citizen. All other households are con-sidered foreign-born regardless of the dateof entry into the United States or citizenshipstatus. The CPS does not interview house-holds in Puerto Rico.
NEW POPULATION CONTROLS AND EXPANDED SAMPLE
The estimates in this report are based on the 2000, improve the reliability of state estimates of children’s2001, and 2002 Current Population Survey Annual health insurance coverage, but the larger sampleDemographic Supplements (CPS ADS) and provide size also improves the reliability of national esti-information for calendar years 1999, 2000, and mates of other topics.2001, respectively. These estimates use population
Because results presented in this report from theestimates based on Census 2000. Earlier reports
2001 survey have been recalculated based on thepresenting data for calendar years 1993 through
expanded sample and the Census 2000-based2000 used population estimates based on the 1990
weights, they may differ from earlier estimates thatcensus.
did not incorporate the sample expansion and wereIn 2001, the Census Bureau tested a sample expan- based on the 1990 census. Appendix B presentssion of 28,000 households to the CPS ADS. The more detail on the introduction of the sample expan-sample expansion was officially implemented in the sion and new population controls based on Censusestimates presented here. It is primarily designed to 2000.
• While the real median income ofHispanic-origin householdsremained unchanged between2000 and 2001 ($33,565), theincome of each race groupdeclined. Median householdincome declined 1.3 percent fornon-Hispanic Whites, 3.4 percentfor Blacks, and 6.4 percent forAsians and Pacific Islanders.6
• The Northeast was the onlyregion that did not experience adecline in real median householdincome between 2000 and 2001.
• Real median income declined forhouseholds in metropolitanareas between 2000 and 2001,going to a level of $45,219.
• The real median earnings ofwomen who worked full-time,
2 Money Income in the United States: 2001 U.S. Census Bureau
6 The differences between the percentdeclines in the median income of Blackhouseholds compared with that of non-Hispanic White and Asian and Pacific Islanderhouseholds are not statistically significant.
year-round increased for thefifth consecutive year, rising to$29,215. Men with similar workexperience did not experience astatistical change in earnings($38,275). As a result, thefemale-to-male earnings ratioreached 0.76, up from the previ-ous all-time-high of 0.74, firstrecorded in 1996.
• The most commonly used indexof household income inequality,the Gini index, did not changebetween 2000 and 2001, whilethe share of aggregate incomereceived by the lowest house-hold income quintile declined.
• Based on comparisons of 2-year-average medians (comparing1999-2000 with 2000-2001), realmedian household income rosefor 3 states (Arizona,Massachusetts, andPennsylvania) and declined for12 states. Five of the states that
experienced declines were in theMidwest (Illinois, Indiana, Iowa,Michigan, and Wisconsin), four inthe South (Alabama, Florida,Mississippi, and Tennessee), twoin the Northeast (Maine andVermont), and one in the West(Washington).
• An important finding of theCensus Bureau’s tax and noncashbenefit research is that govern-ment transfers have a greaterimpact on lowering incomeinequality than the tax system.
OFFICIAL ESTIMATES OFMONEY INCOME
The official income estimates in thisreport are based solely on moneyincome before taxes and do notinclude the value of employment-based fringe benefits nor of govern-ment-provided noncash benefits,such as food stamps, medicare,medicaid, and public or subsidizedhousing. A separate section of thisreport, “Experimental Estimates ofIncome Including Noncash Benefitsand Taxes,” discusses the effect oftaxes and selected noncash benefitson household income using model-based approaches to estimatingtaxes and valuing benefits. TheCensus Bureau’s models of theseeffects are based on informationcollected in the 2002 CPS AnnualDemographic Supplement and othersources, including the InternalRevenue Service, the Food andNutrition Service, the Bureau ofLabor Statistics, and the Centers forMedicare and Medicaid Services.7
Median household incomedeclined between 2000 and2001.
Real median household incomedeclined by 2.2 percent between
7 See Current Population Reports, SeriesP60-186RD, “Measuring the Effect of Benefitsand Taxes on Income and Poverty: 1992,” formore details.
Source of Estimates; Statistical Accuracy
The estimates in this report are based on data collected by the 2002Current Population Survey Annual Demographic Supplement conduct-ed by the U.S. Census Bureau. As with all surveys, the estimatesmay differ from the actual values because of sampling variation orother factors. All statements in this report have undergone statisticaltesting, and all comparisons are significant at the 90-percent confi-dence level unless otherwise noted. For further information aboutthe source and accuracy of the estimates, go to www.census.gov/hhes/income/income01/sa.pdf.
What is . . .? Money Income data are collected for all people inthe sample 15 years old and over. Money income includes earnings,unemployment compensation, workers’ compensation, social securi-ty, supplemental security income, public assistance, veterans’ pay-ments, survivor benefits, pension or retirement income, interest, divi-dends, rents, royalties, estates, trusts, educational assistance,alimony, child support, assistance from outside the household, andother miscellaneous money income. It is income before deductionsfor taxes or other expenses and does not include lump-sum pay-ments or capital gains.
2000 ($43,162) and 2001($42,228), coinciding with therecession that started in March2001. The last time householdincome declined was in 1991,which also coincided with a reces-sion that lasted from July 1990 toMarch 1991 (see Table 1 andAppendix Table A-1).
Family and nonfamilyhouseholds experienceddeclines in median householdincome.
The real median income of familyhouseholds declined between 2000and 2001 (see Table 1). The dropfor family household medianincome overall was 1.7 percent to$52,275; for those maintained byfemale householders with no hus-band present 3.1 percent to$28,142; and for those with malehouseholders with no wife present6.0 percent to $40,715. The per-centage decline in income of non-family households was 1.5 percentto $25,631.8 The income ofmarried-couple families remainedunchanged at $60,471.
Family and nonfamily householdshave not experienced declines inreal median household income sincethe early 1990s. Specifically, familyhouseholds had not experienced anannual decline in real medianincome since 1993, family house-holds maintained by women with nohusband present since 1991, andfamily households maintained bymen with no wife present and non-family households since 1992.
U.S. Census Bureau Money Income in the United States: 2001 3
8 The percentage declines in medianincome for family households, nonfamilyhouseholds, and households maintained byfemales with no husband present are not dif-ferent. The percentage decline in medianincome for households maintained by afemale with no husband present is not dif-ferent from the percentage declines for non-family households and households main-tained by males with no wife present.
Native and foreign-bornhouseholds experienceddeclines in real medianhousehold income between2000 and 2001.
Foreign-born households experi-enced a 5.3 percent decline (to$37,948) in real median householdincome, larger than the 1.5 percentdecline (to $42,917) experiencedby native households (see Table 1).Of foreign-born households, thosemaintained by a naturalized citizenexperienced a 5.4 percent declinein income (to $43,968), not differ-ent from the 4.2 percent decline(to $34,812) for those maintainedby householders who were notUnited States citizens.9
The real median income ofHispanic-origin householdsremained unchanged between2000 and 2001, but theincome of each of the racegroups declined. 10
Hispanic households had a medianincome of $33,565 in 2001, notstatistically different from their2000 median income (see Table 1).Before 2001, Hispanic householdshad experienced 5 years of annualincome increases (see AppendixTable A-1). Their last decline inmedian household incomeoccurred in 1995.
9 The median household income of nativehouseholds was not different from the medi-an for households maintained by a natural-ized citizen. The difference between per-centage changes for households withnoncitizen householders and householdswith native, foreign-born, and naturalizedcitizens were not statistically significant. Inaddition, the differences between the per-centage change for foreign-born householdsand those with a naturalized householderwas not significant.
10 Data users should exercise cautionwhen interpreting aggregate results for theHispanic population because this populationconsists of many distinct groups that differin socio-economic characteristics, culture,and recency of immigration. Data were firstcollected for Hispanics in 1972.
The real median incomes of non-Hispanic White, Black, and Asianand Pacific Islander householdsdeclined between 2000 and 2001,by 1.3 percent (to $46,305) fornon-Hispanic White households; by3.4 percent (to $29,470) for Blackhouseholds; and by 6.4 percent (to$53,635) for Asian and PacificIslander households. 11 12
Non-Hispanic White and Asian andPacific Islander households havenot experienced an annual declinein median household income since1991 and Black households since1981 (see Appendix Table A-1).
Although Asians and PacificIslanders as a group had the high-est median household income in2001, their income per householdmember ($24,933) was not statisti-cally different from the income perhousehold member of non-Hispanic White households($25,751). Asian and PacificIslander households typically havemore people—2.93 people on aver-age compared with 2.42 people fornon-Hispanic White households.The income per household mem-ber for Black households (averagesize of 2.68 people) was $14,635and for Hispanic households (aver-age size of 3.52) was $12,595.13
Table 2 shows income data for theAmerican Indian and Alaska Native
11 Data users should exercise cautionwhen interpreting aggregate results for theAsian and Pacific Islander (API) populationbecause the API population consists of manydistinct groups that differ in socio-economiccharacteristics, culture, and recency of immi-gration. In addition, the CPS does not useseparate population controls for weightingthe API sample to national totals.
12 The differences between the percentdeclines in the median household income ofBlacks compared with that of non-HispanicWhite and Asian and Pacific Islander house-holds are not statistically significant.
13 For a discussion of standardizingincome by size of family using the officialpoverty thresholds, see Current PopulationReports, Series P60-219, “Poverty in theUnited States: 2001.”
4 Money Income in the United States: 2001 U.S. Census Bureau
Table 1.Comparison of Summary Measures of Income by Selected Characteristics: 2000 and 2001(Households and people as of March of the following year. For meaning of symbols, see text)
2001Median income in 20001
(in 2001 dollars)Median income
Characteristic Percent 90-percent90-percent 90-percent change in confidenceconfidence confidence real income interval2 (±)
Number Value interval2 (±) Value interval2 (±) 2000 to of percent(thousands) (dollars) (dollars) (dollars) (dollars) 2001 change
*Statistically significant change at the 90-percent confidence level.1Consistent with 2001 data through implementation of Census 2000-based population controls and a 28,000 household sample expansion.2For an explanation of confidence intervals, see ‘‘Standard errors and their use’’ at www.census.gov/hhes/income/income01/sa.pdf.3Data for American Indians and Alaska Natives are not shown separately in this table because of the small sample of those households.4Hispanics may be of any race.
Source: U.S. Census Bureau, Current Population Survey, 2002 and 2001 Annual Demographic Supplements.
population.14 Because of the smallsize of this racial group, samplingvariability of income data is largerthan for the other racial groupsand causes single-year estimates tofluctuate more widely. To reducethe chances of misinterpretingchanges in income or comparisonof income with other groups, theCensus Bureau uses 2-year-averagemedians for evaluating changes inthe income of American Indiansand Alaska Natives over time, and
3-year-average medians when com-paring the income of this groupwith other racial and ethnic origingroups.15 These 2- and 3-year-average medians make the esti-mates less volatile.
The 3-year-average (1999-2001)median household income forAmerican Indians and AlaskaNatives was $32,116, higher thanthe 3-year-average for Blacks($29,870), not statistically differentfrom that for Hispanics ($33,439),but lower than for non-HispanicWhites ($46,702) and Asians andPacific Islanders ($55,026) (seeTable 2). Based on comparisons of2-year-average medians (1999-2000
U.S. Census Bureau Money Income in the United States: 2001 5
14 Data users should exercise cautionwhen interpreting aggregate results for theAmerican Indian and Alaska Native (AIAN)population because the AIAN population con-sists of groups that differ in economic char-acteristics. Data from the 1990 census showthat the median income of AIAN householdsliving on reservations or in Alaska Native vil-lages was $18,466 (in 2001 dollars) com-pared with $30,521 (in 2001 dollars) forhouseholds outside those areas. In addition,the CPS does not use separate populationcontrols for weighting the AIAN sample tonational totals.
15 The 2-year-average median is the sumof 2 inflation adjusted single-year mediansdivided by 2. The 3-year-average median isthe sum of 3 inflation adjusted single-yearmedians divided by 3.
Detailed Tabulations
Detailed tabulations that pro-vide income of households,families, and people 15 years ofage and older are available onthe Internet at:www.census.gov/hhes/www/income.html.
Income data are cross-tabulat-ed by various characteristicssuch as age, sex, race,Hispanic origin, presence ofchildren, marital status, educa-tional attainment, work experi-ence, occupation, class ofworker, and source of income.Historical data are available aswell. The historical tablesshow income data for house-holds, families, and people byvarious characteristics.
Figure 1.Median Household Income by Race and Hispanic Origin: 1967 to 20011
1Hispanics may be of any race. Data for Hispanics not available before 1972. Data for Asians and Pacific Islanders not available before 1987.Source: U.S. Census Bureau, Current Population Survey, 1968 to 2002 Annual Demographic Supplements.
versus 2000-2001), the real medianhousehold income of AmericanIndians and Alaska Natives did notchange statistically. Of the remain-ing race/ethnic origin groups, onlynon-Hispanic Whites experienced achange—a decline of 0.6 percent intheir 2-year-average median (seeTable 2).
The Northeast was the onlyregion that did not experiencea decline in real medianhousehold income between2000 and 2001.
The median household income ofthe Northeast remained unchangedbetween 2000 and 2001 at$45,716, whereas households inother regions experienceddeclines—the Midwest 3.7 percentto $43,834; the South 1.4 percentto $38,904; and the West
2.3 percent to $45,087 (see Table1).16 The South continues to havethe lowest median householdincome among the regions (seeTable 1). Before 2001, regions hadnot experienced an annual declinein median household income since1992 for the Northeast and 1991for the other regions.
Real median income declinedfor households in metropolitanareas between 2000 and 2001.
The real median income of house-holds in metropolitan areasdeclined by 1.6 percent, to$45,219 (see Table 1). The medianincome of households inside cen-
6 Money Income in the United States: 2001 U.S. Census Bureau
16 The percentage change in householdincome for the West was not statistically dif-ferent from those for the South and Midwest.The difference between the 2001 medianhousehold incomes for Northeast and theWest was not statistically significant.
tral cities declined by 2.7 percent,to $36,731, and 1.8 percent forhouseholds outside central cities,to $50,697. Households outsidemetropolitan areas did not experi-ence a change in income between2000 and 2001.17
The percentage of men whoworked full-time, year-rounddecreased between 2000 and 2001.
Of the 80.3 million men aged 15and over who worked in 2001,73.1 percent worked full-time,year-round, down from the 74.0percent in 2000. Of the 71.3 mil-lion women in the same age groupwho worked in 2001, 58.4 percent
17 The percentage changes in medianhousehold income among the four metropol-itan/nonmetropolitan areas were not statisti-cally different.
Table 2.Income of Households by Race and Hispanic Origin Using 2- and 3-Year-Average Medians(Income in 2001 dollars. The 2000 and 2001 income data shown in this table reflect the implementation of Census 2000-based populationcontrols and a 28,000 household sample expansion. The 1999 income data reflect the use of Census 2000-based population controls. Formeaning of symbols, see text)
Race and Hispanicorigin
3-year-average(1999-2001)
2-year-average medians2 Differences in 2-year-average medians(2000-2001 less
* Statistically significant at the 90-percent confidence level.
1The 3-year-average median is the sum of 3 inflation-adjusted single-year medians divided by 3.2The 2-year-average median is the sum of 2 inflation-adjusted single-year medians divided by 2.3For an explanation of confidence intervals, see ‘‘Standard errors and their use’’ at www.census.gov/hhes/income/income01/sa.pdf.4Hispanics may be of any race.
Source: U.S. Census Bureau, Current Population Survey, 2000, 2001, and 2002 Annual Demographic Supplements.
worked full-time, year-round— Per capita income remainedunchanged from 2000. statistically unchanged.
The per capita income of the over-The real median earnings ofwomen who worked full-time, all population, of each of the race
year-round increased for the groups, and of Hispanics, remainedfifth consecutive year. unchanged between 2000 and
2001 (see Table 1). In 2001, perBetween 2000 and 2001, the medi-capita income was $22,851 for thean earnings of women who workedoverall population, $26,134 forfull-time, year-round increased bynon-Hispanic Whites, $24,277 for3.5 percent, to $29,215 (see TableAsians and Pacific Islanders,1). Men with similar work experi-$14,953 for Blacks, and $13,003ence did not experience a statisticalfor Hispanics.change in earnings between 2000
and 2001 ($38,275), or betweenThe Gini index indicated no1999 and 2000, but experiencedchange in household income
annual increases for each of the inequality between 2000 andprevious 3 years. This dissimilar 2001.pattern in the annual changes in
The Gini index has not shown anearnings of men and women con-annual change since 1993.tributed to a rise in the female-to-Comparisons with earlier years aremale earnings ratio. In 2001, thenot recommended because of aearnings ratio reached 0.76, up
from the previous all-time-high of substantial methodological change
0.74, first recorded in 1996. in the 1994 CPS Annual
U.S. Census Bureau Money Income in the United States: 2001 7
What are . . .? Full-time,Year-round workersworked 50 or more weeksand 35 or more hours perweek during the calendaryear. Paid vacations arecounted as time worked.
What is . . .? Earnings con-sists of: gross money wage orsalary income, including com-missions, tips and cashbonuses, before deductions;net income from nonfarmself-employment (grossreceipts minus businessexpenses); and net incomefrom farm self-employment(gross receipts minus farmexpenses).
Figure 2.Median Earnings of Full-Time, Year-Round Workers 15 Years Old and Over by Sex: 1967 to 2001
Source: U.S. Census Bureau, Current Population Survey, 1968 to 2002 Annual Demographic Supplements.
Demographic Supplement.However, it is clear that the 2001Gini index (0.466) was higher thanin 1999 and earlier years.
In 2001, the share of aggregateincome received by the lowest quin-tile fell slightly from 3.6 percent in
2000 to 3.5 percent in 2001. Allother quintiles did not change—thesecond quintile received 8.7 per-cent, the third quintile 14.6 percent,the fourth quintile 23.0 percent,and the top quintile 50.2 percent(see Appendix Table A-3).
Another method of measuringincome inequality is to compare
selected positions in the incomedistribution (see Appendix Table A-3). The household at the 95th per-centile in 2001 received $150,499in income, 8.4 times that of thehousehold at the 20th percentile($17,970). This ratio is higher thanit was in 2000 (8.1). However, theratio of the 90th percentile to the10th percentile remainedunchanged at 10.6. Appendix Table A-3 presents other measuresof income inequality.18
Most measures of income inequali-ty indicate that inequality rose sub-stantially between 1967 and theearly 1990s and was largely
8 Money Income in the United States: 2001 U.S. Census Bureau
18 See Current Population Reports, SeriesP60-204, “The Changing Shape of theNation’s Income Distribution, 1947-98,” fortrends in other income inequality measures.
What is . . .? The GiniIndex summarizes the dis-persion of income across theentire income distribution. Itranges from 0, which indi-cates perfect equality (whereeveryone receives an equalamount), to 1, which denotesperfect inequality (where allthe income is received byonly one recipient or group ofrecipients).
What are . . .? AggregateShares are computed byranking households from low-est to highest income andthen dividing them intogroups of equal size, typicallyquintiles. The aggregateincome of each group dividedby the overall aggregateincome is each group’s share.
Figure 3.Index of Change for Various Measures of Household Income Inequality: 1967 to 2001
Note: Because of changes in data collection methodology, 1992 and earlier estimates of income inequality are not comparable with those for 1993 and beyond. (See Current Population Reports, Series P60-204, “The Changing Shape of the Nation’s Income Distribution: 1947-1998” for more details.) Source: U.S. Census Bureau, Current Population Survey, 1968 to 2002 Annual Demographic Supplements.
Percent change since 1967
Atkinson e=0.25
-10
0
10
20
30
40
50
20011995199019851980197519701967
Gini index of income inequality
Atkinson e=0.75
Theil
Mean logarithmic deviation of income
Recession
unchanged through the late 1990s(see Figure 3).19
High-income householdstended to be family householdsthat included two or moreearners, lived in the suburbs ofa large city, and had a workinghouseholder between 35 and54 years old. In contrast, low-income households tendedto be in a city with an elderlyhouseholder who lived aloneand did not work.
The 20 percent of households withthe highest income (the highestquintile) received at least $83,500during 2001. The lowest 20 per-cent of households (the lowestquintile) received less than$17,970 during 2001.
Half of households in the top quin-tile lived in a metropolitan areaoutside a city of 1 million or morepeople (see Table 3). Only 10.4percent lived outside any metro-politan area. Among households inthe lowest income quintile, aboutone-quarter (24.5 percent) lived ina metropolitan area outside a cityof 1 million or more, and one-quarter (24.9 percent) livedoutside a metropolitan area.20
Nearly 9 out of 10 households(87.3 percent) in the top quintilewere family households while 8out of 10 (79.9 percent) were mar-ried-couple households. Amonglow-income households, onlyabout 4 out of 10 (40.8 percent)were family households, and only2 out of 10 (19.6 percent) weremarried-couple households.
U.S. Census Bureau Money Income in the United States: 2001 9
19 A change in data collection methodolo-gy in 1993 affected income measurement andoverstated the increase in income inequalitythat year. See Paul Ryscavage, “A Surge inGrowing Income Inequality?,” Monthly LaborReview, August 1995, pp. 51-61.
20 The difference between the percent ofhouseholds living in suburbs and the percentliving outside of a metropolitan area was notstatistically significant.
A high-income household in 2001tended to have a householder in hisor her peak earning years— about 6out of 10 householders (59.5 per-cent) were between 35 and 54 yearsold. Among low-income households,only one-quarter of householders(25.0 percent) were between 35 and54, and the largest proportion (39.7percent) were over 65 years old.
Most high-income households(78.0 percent) had two or moreearners contributing to householdincome while only 2.6 percent ofhouseholds in the top quintile hadno earners. Among low-incomehouseholds, the majority (59.4 per-cent) had no earners, and 6.1 per-cent had two or more.
The majority of high-incomehouseholds (73.7 percent) had ahouseholder who worked full-time,year-round; only 10.4 percent ofhigh-income households had anonworking householder. Amonglow-income households, mosthouseholders (64.7 percent) didnot work in 2001, and 13.5 per-cent worked full-time, year-round.
Real median householdincome rose for 3 states anddeclined for 12 states.
Based on comparisons of 2-year-average medians (comparing 1999-2000 with 2000-2001), real medianhousehold income rose for 3 states(Arizona, Massachusetts, andPennsylvania) and declined for 12states (see Table 4 and Figure 4).21
Five of the states that experienceddeclines were in the Midwest(Illinois, Indiana, Iowa, Michigan,and Wisconsin), four in the South(Alabama, Florida, Mississippi, andTennessee), two in the Northeast
21 To reduce the possibilities of misinter-preting changes in, or rankings of, incomeestimates for states, the Census Bureau uses2-year-average medians for evaluatingchanges in state estimates over time, and 3-year-average medians when comparing therelative ranking of states.
(Maine and Vermont), and one inthe West (Washington).
Comparing the relative ranking ofstates using 3-year-average medi-ans for 1999-2001 shows that themedian household income forAlaska, although not statisticallydifferent from the median incomesfor Maryland, Connecticut, andMinnesota, was higher than thatfor the remaining 46 states and theDistrict of Columbia. Conversely,the median household income forWest Virginia, although notstatistically different from themedian for Arkansas, was lowerthan the incomes of the remaining48 states and the District ofColumbia. The relative standing ofthe remaining states and theDistrict of Columbia was less clearbecause of sampling variabilitysurrounding the estimates.
EXPERIMENTAL ESTIMATESOF INCOME INCLUDINGNONCASH BENEFITS AND TAXES
Traditionally, income data presentedin the Census Bureau’s reports havebeen based on the amount ofmoney received during a calendaryear before taxes and excludingcapital gains, but this restricted def-inition of income does not provide acompletely satisfactory measure ofincome. Over time, tax laws maychange and affect the economicwell-being of the population. In theearly 1980s, the Census Bureauembarked on a research program toexamine the effects of taxes on eco-nomic well being. Four types ofmodeled tax data are included here:federal individual income taxes,state individual income taxes, prop-erty taxes on owner-occupied hous-ing, and payroll taxes.
Because noncash benefits increasethe income resources available toindividuals and families, this report
also presents income measuresthat include the valuation of vari-ous noncash benefits, such as foodstamps, school lunches, housingsubsidies, medicare, medicaid,employer contributions to healthinsurance, and net imputed returnson home equity.22
Taxes, government transfers,and other benefits affect thedistribution and the level ofincome.
As shown in Table 5, there was adecline in real income between
2000 and 2001 for 13 (definitions1-13) of the 15 definitions ofincome (only a few of which arediscussed below).
Definition 1, the official definitionof income, is based on moneyincome before taxes and includesgovernment cash transfers.Between 2000 and 2001, realmedian income of householdsdeclined, 2.2 percent, to $42,228.Under Definition 1, the share ofaggregate household incomereceived by each quintile was 3.5percent for the lowest, 8.8 percentfor the second, 14.5 percent forthe third, 23.1 percent for thefourth, and 50.1 percent for thehighest. The Gini index for allhouseholds under Definition 1 was
10 Money Income in the United States: 2001 U.S. Census Bureau
22 For more information on the methodol-ogy and procedures used to estimate taxesand to value noncash benefits see CurrentPopulation Reports, P60-186RD, “Measuringthe Effect of Benefits and Taxes on Incomeand Poverty: 1992.”
Model-Based StateEstimates
The Census Bureau also com-putes improved (in the sense ofhaving lower standard errors)annual estimates of medianhousehold income for states,as well as biennial estimatesfor counties, based on modelsusing data from the CPS, the1990 decennial census, andadministrative records. State-level estimates for 1998 areavailable on the Internet at:www.census.gov/hhes/www/saipe.html. Estimates forincome year 1999 will be avail-able later this fall.
Table 3.Distribution of Households by Selected Characteristics Within Income Quintiles: 2001(Households as of March 2002)
Characteristic Lowest quintile Middle three quintiles Highest quintile
Source: U.S. Census Bureau, Current Population Survey, 2002 Annual Demographic Supplement.
U.S. Census Bureau Money Income in the United States: 2001 11
Table 4.Income of Households by State Using 2- and 3-Year-Average Medians(Income in 2001 dollars. The 2000 income data used in this table reflect the implementation of Census 2000-based population controls anda 28,000 household sample expansion. The 1999 income data reflect the use of Census 2000-based population controls)
2-year-average medians2
3-year-average median1 2000-2001 average less1999-2001 1999-2000 average
2000-2001 1999-2000
State90-percent 90-percent 90-percent
Median confidence Median confidence Median confidenceincome interval3 (±) income interval3 (±) income interval3 (±) Percent
* Statistically significant at the 90-percent confidence level.1The 3-year-average median is the sum of 3 inflation-adjusted single-year medians divided by 3.2The 2-year-average median is the sum of 2 inflation-adjusted single-year medians divided by 2.3For an explanation of confidence intervals, see ‘‘Standard errors and their use’’ at www.census.gov/hhes/income/income01/sa.pdf.
Source: U.S. Census Bureau, Current Population Survey, 2000, 2001, and 2002 Annual Demographic Supplements.
12 Money Income in the United States: 2001 U.S. Census Bureau
0.450 in 2001, unchanged from2000.23
Definition 4 reflects incomegenerated by the privatesector and results in a moreunequal distribution than theofficial definition of income.
Definition 4 excludes cash trans-fers, adds net capital gains, and
23 This report presents Gini indexes andshares of aggregate income received by eachquintile using two methods. The firstmethod, discussed in the text, sorts individ-ual households by income yielding a Giniindex of 0.466 and quintile shares of 3.5, 8.8,14.6, 23.0, and 50.2. The second method,reported in Table 6, uses group data andemploys several interpolation routines result-ing in a Gini index of 0.450 and quintileshares of 3.5, 8.8, 14.5, 23.1, and 50.1.
adds employer contributions tohealth insurance. Under this defini-tion of income, the shares ofincome received by the lowest twoquintiles of households declinedfrom that of Definition 1 (from 3.5 percent to 0.9 percent, andfrom 8.8 percent to 6.9 percent,respectively), while the sharereceived by the highest quintileincreased from 50.1 percent to55.6 percent (see Table 6). TheGini index under this definition ofincome, 0.510, was 13.3 percenthigher (showing more incomeinequality) than the index underthe official income definition(0.450).
The 2001 median income forDefinition 4 was $41,346, 97.9percent of the official definition.24
Between 2000 and 2001, realmedian income under this defini-tion declined 2.0 percent.
The net effect of deductingsocial security payroll taxes,federal and state incometaxes, and adding the earnedincome tax credit was toreduce income inequality.
This result is shown by Definition8. The share of income going to
24 Differences among income definitionsare all significant because they come fromthe same sample.
Figure 4. AK Percent Change in 2-Year-Average Median Household
Income by State: 1999-2000 to 2000-2001
Median Household Income Change
IncreaseNo change
WA Decrease-6.3
VTME
MT -4.0ND -5.9
OR MNID
NHNY MA +5.8
SD WI-3.3
WY MI CT-4.1 RI
IA PA+4.1NV NE -3.1 NJ
OH MDUT IL IN DECA
-3.1CO -3.5 WVVA DCKS MO
KY
NCTNAZ OK -4.1
+4.2 NM AR SC
GAMS AL
-6.2 -4.5
TXLA
FL-2.1
HI
Source: U.S. Census Bureau, Current Population Survey, 2000, 2001, and 2002 Annual Demographic Supplements.
the bottom three quintiles income going to the lowest quin-increased, and the share received tile (from 1.2 percent to 3.9 per-by the highest quintile declined. cent) and lowered the share goingThe Gini index was 0.492, or to the highest quintile (from 51.83.5 percent below the value of percent to 47.7 percent).0.510 for Definition 4.
The 2001 median income underThe 2001 median income for Definition 11 was $40,653, 96.3Definition 8 was $34,927, 82.7 percent of the official definition.percent of the official definition. Between 2000 and 2001, realBetween 2000 and 2001, real median income declined 0.6 per-median income declined 1.6 per- cent for Definition 11.cent under Definition 8.
Means-tested noncashNonmeans-tested cash transfers also reduced incometransfers reduced income inequality, as shown byinequality more than taxes. Definition 14.
Nonmeans-tested cash transfers, When means-tested noncash trans-
such as social security, lowered the fers were included, the share of
Gini index by 13.4 percent, from income in the lowest quintile
0.492 to 0.426, as shown by com- increased (from 3.9 percent to 4.5
paring Definition 11 estimates with percent) while the share in the
Definition 8 estimates. Including highest quintile decreased (from
the benefits increased the share of 47.7 percent to 47.0 percent). The
Gini index declined 3.3 percentfrom 0.426 to 0.412.25
The 2001 median income forDefinition 14 was $41,533, 98.4percent of the official definition.Between 2000 and 2001, realmedian income did not changeunder this definition of income.
An important finding of theCensus Bureau’s tax andnoncash benefit research isthat government transfershave a greater impact onlowering income inequalitythan the tax system.
In 2001, subtracting taxes andincluding the earned income credit(EIC) lowered the Gini index by
U.S. Census Bureau Money Income in the United States: 2001 13
25 There was no change in incomeinequality between 2000 and 2001 using themost comprehensive definition of income.However, the 2001 Gini index for definition14 is higher than in 1997.
Table 5.Median Household Income by Definition: 2000 and 2001(Income in 2001 dollars)
Definition of incomeMedian income
Percent change2001-2000
Percent ofofficial definition
of income22001 2000
Income before taxes:
1. Money income excluding capital gains (official measure). . . . . . 42,228 43,162 *–2.2 100.02. Definition 1 less government cash transfers . . . . . . . . . . . . . . . . . 39,010 39,811 *–2.0 92.43. Definition 2 plus capital gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,561 40,427 *–2.1 93.74. Definition 3 plus health insurance supplements to wage or
5. Definition 4 less social security payroll taxes . . . . . . . . . . . . . . . . 38,773 39,546 *–2.0 91.86. Definition 5 less federal income taxes (excluding the EIC) . . . . 35,885 36,458 *–1.6 85.07. Definition 6 plus the earned income credit (EIC)1 . . . . . . . . . . . . 36,072 36,628 *–1.5 85.48. Definition 7 less state income taxes . . . . . . . . . . . . . . . . . . . . . . . . 34,927 35,495 *–1.6 82.79. Defintion 8 plus nonmeans-tested government cash transfers . 38,628 39,062 *–1.1 91.510. Definition 9 plus the value of medicare . . . . . . . . . . . . . . . . . . . . . 40,635 40,903 *–0.7 96.211. Definition 10 plus the value of regular-price school lunches . . . 40,653 40,918 *–0.6 96.312. Definition 11 plus means-tested government cash transfers . . . 40,819 41,115 *–0.7 96.713. Definition 12 plus the value of medicaid . . . . . . . . . . . . . . . . . . . . 41,373 41,517 –0.3 98.014. Definition 13 plus the value of other means-tested
government noncash transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . 41,533 41,654 –0.3 98.415. Definition 14 plus net imputed return on equity in own home . . 43,237 (NA) (NA) 102.4
* Statistically significant at the 90-percent confidence level. NA Not available.
1 Thirteen states (Colorado, Illinois, Iowa, Kansas, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island, Vermont,and Wisconsin) and District of Columbia have an EIC that uses federal eligibility rules to compute the state credit. The remaining states do not have state EIC.
2 Differences between income definitions are all significant because they come from the same sample.
Source: U.S. Census Bureau, Current Population Survey, 2001 and 2002 Annual Demographic Supplements.
3.5 percent (from 0.510 to 0.492), Roundingwhile including transfers lowered The Census Bureau rounds percent-the Gini index by 16.3 percent
ages to the nearest tenth of a per-(from 0.492 to 0.412).
cent; therefore, the percentages ina distribution do not always sumCPS Data Collectionto exactly 100.0 percent.
The information in this report wascollected in the 50 states and the Symbols Used in TablesDistrict of Columbia and does not - Represents zero or rounds toinclude residents of Puerto Rico zero.and outlying areas. The estimates B Base less than 75,000.in this report are controlled to NA Not available.national population estimates by r Revised.age, race, sex, and Hispanic origin, X Not applicable.and to state population estimatesby age, and are based on the new USER COMMENTSexpanded CPS sample. For more
The Census Bureau welcomes theinformation on the CPS expansion,comments and advice of users ofsee Appendix B. The populationdata and reports. If you have anycontrols used to prepare the esti-suggestions or comments, pleasemates in this report are based onwrite to:results of Census 2000.
Edward J. Welniak, Jr.The CPS excludes armed forcesChief, Income Surveys Branchpersonnel living on military basesHousing and Household Economicand people living in institutions.
Statistics DivisionFor further documentation aboutU.S. Census Bureauthe CPS Annual DemographicWashington, DC 20233-8500Supplement, see
14 Money Income in the United States: 2001 U.S. Census Bureau
What are . . .? GovernmentCash Transfers includesocial security, railroad retire-ment, black lung, unemploy-ment compensation, workers’compensation, veterans’ bene-fits, government educationalassistance, cash public assis-tance, and supplemental secu-rity income.
What are . . .? Nonmeans-tested Cash Transfersinclude social security, rail-road retirement, black lung,unemployment compensation,workers’ compensation, non-means-tested veterans’ bene-fits, and government educa-tional assistance.
What are . . .? Means-testedCash Transfers include cashpublic assistance, supplementalsecurity income, and means-tested veterans’ benefits.
Table 6.Percentage of Aggregate Income Received by Income Quintiles and Gini Indexby Definition of Income: 2001
plus capital gains and employee health benefits) . . . . . . . . 0.9 6.9 13.7 22.8 55.6 .510Definition 8 (definition 4 less taxes, plus EIC) . . . . . . . . . . . . .Definition 11 (definition 8 plus nonmeans tested
government cash transfers, value of medicare, and value
1.2 8.1 15.0 23.9 51.8 .492
of regular-price school lunches) . . . . . . . . . . . . . . . . . . . . . . .Definition 14 (definition 11 plus means-tested government
cash transfers, value of medicaid, and value of other
3.9 10.0 15.6 22.8 47.7 .426
means-tested government noncash transfers) . . . . . . . . . . . 4.5 10.3 15.6 22.6 47.0 .412Definition 15 (definition 14 plus return on home equity) . . . . 4.7 10.4 15.6 22.7 46.5 .407
Source: U.S. Census Bureau, Current Population Survey, 2002 Annual Demographic Supplement.
U.S. Census Bureau Money Income in the United States: 2001 15
Table A-1.Households by Total Money Income, Race, and Hispanic Origin of Householder:1967 to 2001(Income in 2001 CPI-U-RS adjusted dollars. Households as of March of the following year. For meaning of symbols, see text)
and year Number $5,000 $10,000 $15,000 $25,000 $35,000 $50,000 $75,000 Value error Value dard(thou- Under to to to to to to to $100,000 (dol- (dol- (dol- error
sands) Total $5,000 $9,999 $14,999 $24,999 $34,999 $49,999 $74,999 $99,999 and over lars) lars) lars) (dollars)
16 Money Income in the United States: 2001 U.S. Census Bureau
Table A-1.Households by Total Money Income, Race, and Hispanic Origin of Householder:1967 to 2001—Con.(Income in 2001 CPI-U-RS adjusted dollars. Households as of March of the following year. For meaning of symbols, see text)
U.S. Census Bureau Money Income in the United States: 2001 17
Table A-1.Households by Total Money Income, Race, and Hispanic Origin of Householder:1967 to 2001—Con.(Income in 2001 CPI-U-RS adjusted dollars. Households as of March of the following year. For meaning of symbols, see text)
18 Money Income in the United States: 2001 U.S. Census Bureau
Table A-1.Households by Total Money Income, Race, and Hispanic Origin of Householder:1967 to 2001—Con.(Income in 2001 CPI-U-RS adjusted dollars. Households as of March of the following year. For meaning of symbols, see text)
NA Not available.1Implementation of Census 2000-based population controls and a 28,000 household sample expansion.2Reflects a correction to the March 2001 CPS weighting.3Full implementation of 1990 census-based sample design and metropolitan definitions, 7,000 household sample reduction, and revised race edits.4Introduction of 1990 census sample design.5Data collection method changed from paper and pencil to computer-assisted interviewing. In addition, the March 1994 income supplement was revised to
allow for the coding of different income amounts on selected questionnaire items. Limits either increased or decreased in the following categories: earnings lim-its increased to $999,999; social security limits increased to $49,999; supplemental security income and public assistance limits increased to $24,999; veteransbenefits limits increased to $99,999; child support and alimony limits decreased to $49,999.
6Implementation of 1990 census population controls.7Implementation of a new March CPS processing system.8Recording of amounts for earnings from longest job increased to $299,999. Full implementation of 1980 census-based sample design.9Implementation of Hispanic population weighting controls and introduction of 1980 census-based sample design.10Implementation of 1980 census population controls. Questionnaire expanded to show 27 possible values from 51 possible sources of income.11First year medians were derived using both Pareto and linear interpolation. Before this year all medians were derived using linear interpolation.12Some of these estimates were derived using Pareto interpolation and may differ from published data which were derived using linear interpolation.13Implementation of a new March CPS processing system. Questionnaire expanded to ask 11 income questions.14Full implementation of 1970 census-based sample design.15Introduction of 1970 census sample design and population controls.16Implementation of a new March CPS processing system.17People of Hispanic origin may be of any race.
Source: U. S. Census Bureau, Current Population Survey, 1968 to 2002 Annual Demographic Supplements.
U.S. Census Bureau Money Income in the United States: 2001 19
Table A-2.Share of Aggregate Income Received by Each Fifth and Top 5 Percent of Households:1967 to 2001(Households as of March of the following year. Income in 2001 CPI-U-RS adjusted dollars)
Year Number(thou-
sands)
Upper limit of each fifth(dollars)
Lowerlimit of
top 5percent(dollars)
Share of aggregate income
Meanincome
(dollars)GiniratioLowest Second Third Fourth Lowest Second Third Fourth Highest
1Implementation of Census 2000-based population controls and a 28,000 household sample expansion.2Reflects a correction to the March 2001 CPS weighting.3Full implementation of 1990 census-based sample design and metropolitan definitions, 7,000 household sample reduction, and revised race edits.4Introduction of 1990 census sample design.5Data collection method changed from paper and pencil to computer-assisted interviewing. In addition, the March 1994 income supplement was revised to
allow for the coding of different income amounts on selected questionnaire items. Limits either increased or decreased in the following categories: earnings lim-its increased to $999,999; social security limits increased to $49,999; supplemental security income and public assistance limits increased to $24,999; veteransbenefits limits increased to $99,999; child support and alimony limits decreased to $49,999.
6Implementation of 1990 census population controls.7Implementation of a new March CPS processing system.8Recording of amounts for earnings from longest job increased to $299,999. Full implementation of 1980 census-based sample design.9Implementation of Hispanic population weighting controls and introduction of 1980 census-based sample design.10Implementation of 1980 census population controls. Questionnaire expanded to show 27 possible values from 51 possible sources of income.11First year medians were derived using both Pareto and linear interpolation. Before this year all medians were derived using linear interpolation.12Some of these estimates were derived using Pareto interpolation and may differ from published data which were derived using linear interpolation.13Implementation of a new March CPS processing system. Questionnaire expanded to ask 11 income questions.14Full implementation of 1970 census-based sample design.15Introduction of 1970 census sample design and population controls.16Implementation of a new March CPS processing system.
Source: U.S. Census Bureau, Current Population Survey, 1968 to 2002 Annual Demographic Supplements.
20
Mon
ey In
com
e in th
e Un
ited States: 2
00
1U
.S. Cen
sus Bu
reau
Table A-3.Selected Measures of Household Income Dispersion: 1967 to 2001(In 2001 dollars. For further explanation of income inequality measures, see Current Population Reports, Series P60-204, ‘‘The Changing Shape of the Nation’s Income Distribution:1947-1998’’)
Table A-3.Selected Measures of Household Income Dispersion: 1967 to 2001—Con(In 2001 dollars. For further explanation of income inequality measures, see Current Population Reports, Series P60-204. ‘‘The Changing Shape of the Nation’s Income Distribution:1947-1998’’)
Table A-3.Selected Measures of Household Income Dispersion: 1967 to 2001—Con(In 2001 dollars. For further explanation of income inequality measures, see Current Population Reports, Series P60-204. ‘‘The Changing Shape of the Nation’s Income Distribution:1947-1998’’)
1Implementation of Census 2000-based population controls and a 28,000 household sample expansion.2 Reflects a correction to the March 2001 CPS weighting.3 Full implementation of 1990 census-based sample design and metropolitan definitions, 7,000 household sample reduction, and revised race edits.4 Introduction of 1990 census sample design.5 Data collection method changed from paper and pencil to computer-assisted interviewing. In addition, the March 1994 income supplement was revised to allow for the coding of different income amounts on
selected questionnaire items. Limits either increased or decreased in the following categories: earnings limits increased to $999,999; social security limits increased to $49,999; supplemental security income andpublic assistance limits increased to $24,999; veterans’ benefits limits increased to $99,999; child support and alimony limits decreased to $49,999.
6 Implementation of 1990 census population controls.7 Implementation of a new March CPS processing system.8 Recording of amounts for earnings from longest job increased to $299,999. Full implementation of 1980 census-based sample design.9 Implementation of Hispanic population weighting controls and introduction of 1980 census-based sample design.10 Implementation of 1980 census population controls. Questionnaire expanded to show 27 possible values from 51 possible sources of income.11 First year medians were derived using both Pareto and linear interpolation. Before this year all medians were derived using linear interpolation.12 Some of these estimates were derived using Pareto interpolation and may differ from published data which were derived using linear interpolation.13 Implementation of a new March CPS processing system. Questionnaire expanded to ask 11 income questions.14 Full implementation of 1970 census-based sample design.15 Introduction of 1970 census sample design and population controls.16 Implementation of a new March CPS processing system.
Source: U.S. Census Bureau, Current Population Survey, 1968 to 2002 Annual Demographic Supplements.
U.S. Census Bureau Money Income in the United States: 2001 23
The 2001 Current Population Effects of the Sample ($54,717), although not statistical-Survey (CPS) served as a tool for Expansion on National ly different from Minnesota or
Estimates of Incometesting a sample expansion of the Alaska, higher than the remainingAnnual Demographic Supplement Nationally, median household 47 states and the District ofand as a bridge to introduce new income based on the expanded Columbia. West Virginia ($29,526),Census 2000-based population sample was not statistically differ- although not statistically differentcontrols. The following section ent from the median derived from from Arkansas and Louisiana, wasdiscusses the effects these the original sample (see Table B-1). ranked lower than the remainingmethodological changes had on With few exceptions, median 47 states and the District ofmeasures of income and earnings. income did not change significant- Columbia. In comparison, the
ly for subgroups of the population. median income based on the origi-Sample Expansion The exceptions, with lower median nal sample showed that Maryland
($51,601) was not statistically dif-In 2001, the Census Bureau tested incomes based on the expandedferent from New Jersey, Minnesota,a 28,000 household expansion in sample, are non-family householdsAlaska, Connecticut, Delaware,the sample for the CPS Annual with a female householder, house-
Demographic Supplement. The holds with a Black householder, Virginia, New Hampshire,
and households in the Northeast. Colorado, or Hawaii, but wasoriginal sample size of approxi-mately 50,000 interviewed house- Households with a householder ranked higher than the remaining
holds for the March 2001 CPS was between the ages of 35 and 44 40 states and the District of
years was the one demographic Columbia, while West Virginiaincreased to approximately($29,041) was not statistically dif-78,000. The primary goal of the group in which the expanded sam-
sample expansion was to produce ple median income was higher ferent from Arkansas and
more reliable state estimates of the than the one derived from the orig- Louisiana, but was ranked lowerthan the remaining 47 and thenumber of low-income children inal sample. The median earnings
without health insurance for the of women working full-time, year- District of Columbia.
State Children’s Health Insurance round derived from the expandedIntroduction of Census 2000-Program (SCHIP) through reduced sample was also higher. The perBased Population Controls
variances. Although the SCHIP capita income of Blacks was lower,
sample expansion was specifically and the per capita income of The procedure used in developing
targeted toward producing better Hispanics was higher, when based estimates for the entire civilian
children’s health insurance esti- on the expanded sample. noninstitutional population for the
mates at the state level, other state Current Population Survey (CPS)Effects of the Sampleestimates, as well as national esti- involves the weighting of sampleExpansion on State Estimatesmates, improved. Further informa- results to independent estimates ofof Household Income
tion about the SCHIP sample the population by sex, age, race,
expansion is available on the Although no changes in state rank- and Hispanic/non-Hispanic cate-
internet at: www.bls.census.gov/ ings were statistically significant, gories. These independent esti-
cps/ads/adsmain.htm. the sample expansion produced mates are developed by using civil-significantly different median ian noninstitutional population
Tables B-1 (at the national level) household income estimates for 19 counts from the decennial census-and B-2 (at the state level) present states and the District of Columbia es and projecting them forward totwo sets of data for 2000 to show (see Table B-2). Ten states and the current years using data on births,the effect of the sample expansion. District of Columbia had higher deaths, and net migration.One set of estimates is based on median incomes, while nine states Beginning with the 2002 CPSthe “Expanded” sample and the had lower median incomes. The Annual Demographic Supplement,other set is based on the “Original” expanded sample ranked Maryland the independent estimates used assample.
Appendix B. SAMPLE EXPANSION AND INTRODUCTION OF CENSUS 2000-BASEDPOPULATION CONTROLS
24 Money Income in the United States: 2001 U.S. Census Bureau
control totals for the CPS are based calendar year median household In contrast, use of the new Censuson civilian noninstitutional popula- income estimates, although the 2000-based controls raised thetion benchmarks established by drops in income were all less than median household income ofCensus 2000. 1.0 percent, median household Hispanics, family households main-
income dropped for all regions in tained by women with no husbandTable B-3 shows two sets of data
the country, for households that present, and those maintained byfor 2000 to show the effect of
were located inside and outside householders 15 to 24 and 55 to 64introducing new population con-
metropolitan areas, and for all race years of age. The median incometrols—one set using new Census
groups. Use of the new controls of households maintained by a man2000-based population controls
also lowered the income of most with no wife present remained sta-and the other set using controls
types of households and most of tistically unchanged. The Censusbased on the 1990 census. The
the age groups of householders 2000-based population controls alsofollowing is a brief discussion of
shown in Table B-3. Similar to the raised the per capita income ofthe effects of the new population
experience of most households, the most population groups. Thecontrols on income.
use of the new Census 2000-based exception was the per capita
With few exceptions, the use of new population controls lowered the income of Blacks, which dropped by
Census 2000-based population median earnings of full-time, year- 0.4 percent.
controls resulted in lower 2000 round workers.
U.S. Census Bureau Money Income in the United States: 2001 25
Table B-1.Comparison of 2000 Median Income Using the Expanded Sample and the Original Sampleby Selected Characteristics(Households and people as of March 2001)
Expanded sample Original sample Difference (expandedsample minus
Median income Median income original sample)
Characteristics90-percent 90-percent Population Percent
Number confidence Number confidence count Median change in(thou- Value interval1 (±) (thou- Value interval1 (±) (thou- income median
sands) (dollars) (dollars) sands) (dollars) (dollars) sands) (dollars) income
*Statistically significant change at the 90-percent confidence level.1For an explanation of confidence intervals, see ‘‘Standard errors and their use’’ at www.census.gov/hhes/income/income01/sa.pdf.2Data for American Indians and Alaska Natives are not shown separately in this table because of the small sample of those households.3People of Hispanic origin may be of any race.
Source: U.S. Census Bureau, Current Population Survey, 2001 Annual Demographic Survey.
26 Money Income in the United States: 2001 U.S. Census Bureau
Table B-2.Comparison of 2000 Median Income by State Using the Expanded Sampleand the Original Sample(Households as of March 2001)
Difference (expandedExpanded sample Original sample sample minus
original sample)
Median income Median incomeStates
Number 90-percent Number 90-percent Number Percentof house- confidence of house- confidence of house- Median change in
holds (thou- Value interval1 (±) holds (thou- Value interval1 (±) holds (thou- income mediansands) (dollars) (dollars) sands) (dollars) (dollars) sands) (dollars) income
United States. . . 106,289 42,105 219 106,418 42,151 324 –129 –46 –0.1
- Represents zero or rounds to zero. * Statistically significant at the 90-percent confidence level.1For an explanation of confidence intervals, see ‘‘Standard errors and their use’’ at www.census.gov/hhes/income/income01/sa.pdf.
Source: U.S. Census Bureau, Current Population Survey, 2001 Annual Demographic Supplement.
U.S. Census Bureau Money Income in the United States: 2001 27
Table B-3.Comparison of 2000 Median Income Using Census 2000-Based Population Controls and1990 Census-Based Population Controls by Selected Characteristics(Households and people as of March 2001)
- Represents zero or rounds to zero. *Statistically significant change at the 90-percent confidence level.1For an explanation of confidence intervals, see ‘‘Standard errors and their use’’ at www.census.gov/hhes/income/income01/sa.pdf.2Data for American Indians and Alaska Natives are not shown separately in this table because of the small sample of those households.3Hispanics may be of any race.
Source: U.S. Census Bureau, Current Population Survey, 2001 Annual Demographic Supplement.