Real Earnings, Health Insurance and Pension Coverage, and the Distribution of Earnings, 1979-2006

Order Code RL34469 Real Earnings, Health Insurance and Pension Coverage, and the Distribution of Earnings, 1979-2006 April 28, 2008 Gerald Mayer Analyst in Public Finance Domestic Social Policy Division Real Earnings, Health Insurance and Pension Coverage, and the Distribution of Earnings, 1979-2006 Summary From 1979 to 2006, there were differences between men and women in the level and growth in real earnings (i.e., actual earnings adjusted for inflation) and in employment-based health insurance and pension coverage. The pattern of earnings and benefit coverage also differed between all employed persons and workers employed full-time, year-round. All Workers. From 1979 to 2006, average real weekly earnings for all workers increased by 23.7%. Earnings increased at all earnings levels. Workers with higher earnings were more likely to have employment-based health insurance and pension coverage. From 1979 to 2006, participation in an employer or union pension plan increased for lower-wage workers but decreased for workers with higher earnings. From 1987 to 2006, health insurance coverage fell for workers at all earnings levels. From 1979 to 2006, the earnings gap between men and women narrowed. The earnings of men at the 20th, 40th, and 60th percentiles were relatively unchanged, while the earnings of women increased at all earnings levels. Except at the lowest quintile, the participation of men in an employer or union pension plan declined. Except at the top quintile, the participation of women in a pension plan increased. The percentage of men and women with employment-based health insurance coverage declined at all earnings levels. The decline was greatest among lower-wage workers and greater among men than women. Thus, men at the 20th, 40th, and 60th percentiles did not experience an increase in earnings and lost both pension and health insurance coverage. For women, the increase in earnings at the 20th, 40th, and 60th percentiles and improved participation in an employer or union pension plan were offset, to some degree, by a decline in health insurance coverage. Full-Time, Year-Round Workers. From 1979 to 2006, the percentage of workers employed full-time, year-round increased from 56.4% to 68.5% of all workers. The real weekly earnings of full-time, year-round workers increased by 15.4%. Earnings rose at all earnings levels. The increase was greatest (32.5%) at the 95th percentile. The earnings of men at the 20th and 40th percentiles fell by almost 10%, while the earnings of women increased at all earnings levels. Except for men with the highest earnings (i.e., top 5%), pension coverage fell for both men and women. Employment-based health insurance coverage also fell for both men and women. The decline was greatest among lower-wage workers and greater for lowerwage men than women. Thus, lower-wage men who worked full-time, year-round experienced both a decrease in earnings and a decline in pension and health insurance coverage. Despite improved earnings, women who were employed full-time, yearround lost both pension and health insurance coverage. Finally, inequality among all workers increased from 1979 to 2006. Inequality generally increased from 1980 to 1986, declined slightly from 1986 to 1992, rose again from 1992 to 1994, fell from 1995 to about 1999, and increased from about 1999 to 2005. Overall inequality decreased from 2005 to 2006, but it increased among women and decreased among men. This report will be updated periodically. Contents Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Organization of Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 The Definition of Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Summary of Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 All Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Full-Time, Year-Round Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Policies to Increase Real Earnings or Reduce Inequality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Real Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Productivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Economic Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Inequality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Indirect Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Direct Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Tradeoff with Economic Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Macroeconomic Policies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 The Trend in Real Weekly Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 All Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Full-Time, Year-Round Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Fringe Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Employment-Based Health Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 All Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Full-Time, Year-Round Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Employer- or Union-Provided Pension Plans . . . . . . . . . . . . . . . . . . . . . . . 17 All Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Full-Time, Year-Round Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 The Distribution of Weekly Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Topcoded Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Gini Coefficient . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 All Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Full-Time, Year-Round Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 The Share of Total Weekly Earnings by Quintile . . . . . . . . . . . . . . . . . . . . 23 All Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Full-Time, Year-Round Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Reasons for Changes in the Share of Total Weekly Earnings by Quintile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Appendix: Measures of Inequality, Data, and Methodology . . . . . . . . . . . . . . . . 27 Measures of Inequality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Gini Coefficient . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Share of Total Earnings by Quintile . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Data Source and Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 CPI-U-RS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Topcoded Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Confidence Levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Data Used in Text and Graphs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 List of Figures Figure 1. Percentage of Full-Time Workers and Full-Time, Year-Round Workers, 1979-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Figure 2. Real Weekly Earnings, All Workers, 1979-2006 . . . . . . . . . . . . . . . . . 9 Figure 3. Real Weekly Earnings, All Male Workers, 1979-2006 . . . . . . . . . . . . 10 Figure 4. Real Weekly Earnings, All Female Workers, 1979-2006 . . . . . . . . . . 11 Figure 5. Real Weekly Earnings, Full-Time, Year-Round Workers, 1979-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Figure 6. Real Weekly Earnings, Male Full-Time, Year-Round Workers, 1979-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Figure 7. Real Weekly Earnings, Female Full-Time, Year-Round Workers, 1979-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Figure 8. Employment-Based Health Insurance Coverage, All Workers, by Quintile, 1987-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Figure 9. Employment-Based Health Insurance Coverage, Full-Time, Year-Round Workers, by Quintile, 1987-2006 . . . . . . . . . . . . . . . . . . . . . . 17 Figure 10. Participation in an Employer- or Union-Provided Pension Plan, All Workers, by Quintile, 1979-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Figure 11. Participation in an Employer- or Union-Provided Pension Plan, Full-Time, Year-Round Workers, by Quintile, 1979-2006 . . . . . . . . . . . . . 19 Figure 12. Gini Coefficient, All Workers, 1979-2006 . . . . . . . . . . . . . . . . . . . . 22 Figure 13. Gini Coefficient, Full-Time, Year-Round Workers, 1979-2006 . . . . 22 Figure 14. Share of Total Weekly Earnings by Quintile, All Workers, 1979-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Figure 15. Share of Total Weekly Earnings by Quintile, Full-Time, Year-Round Workers, 1979-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Figure 16. Illustration of Lorenz Curves and Gini Coefficients for Two Groups of Workers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 List of Tables Table 1a. The Trend in Real Weekly Earnings: All Workers, 1979-1994 . . . . . 31 Table 1b. The Trend in Real Weekly Earnings: All Workers, 1995-2006 . . . . . 32 Table 2a. The Trend in Real Weekly Earnings: Full-Time, Year-Round Workers, 1979-1994 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Table 2b. The Trend in Real Weekly Earnings: Full-Time, Year-Round Workers, 1995-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Table 3a. Employment-Based Health Insurance Coverage: All Workers 1987-1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Table 3b. Employment-Based Health Insurance Coverage: All Workers, 2000-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Table 4a. Employment-Based Health Insurance Coverage: Full-Time, Year-Round Workers, 1987-1999 . . . . . . . . . . . . . . . . . . . . . . . 37 Table 4b. Employment-Based Health Insurance Coverage: Full-Time, Year-Round Workers, 2000-2006 . . . . . . . . . . . . . . . . . . . . . . . 38 Table 5a. Employer- or Union-Provided Pension Coverage: All Workers, 1979-1994 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Table 5b. Employer- or Union-Provided Pension Coverage: All Workers, 1995-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Table 6a. Employer- or Union-Provided Pension Coverage: Full-Time, Year-Round Workers, 1979-1994 . . . . . . . . . . . . . . . . . . . . . . . 41 Table 6b. Employer- or Union-Provided Pension Coverage: Full-Time, Year-Round Workers, 1995-2006 . . . . . . . . . . . . . . . . . . . . . . . 42 Table 7. Gini Coefficients for All Workers and for Full-Time, Year-Round Workers, 1979-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 Table 8a. Share of Total Weekly Earnings: All Workers, 1979-1994 . . . . . . . . 45 Table 8b. Share of Total Weekly Earnings: All Workers, 1995-2006 . . . . . . . . 46 Table 9a. Share of Total Weekly Earnings: Full-Time, Year-Round Workers, 1979-1994 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Table 9b. Share of Total Weekly Earnings: Full-Time, Year-Round Workers, 1995-2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Real Earnings, Health Insurance and Pension Coverage, and the Distribution of Earnings, 1979-2006 Introduction Real earnings and the distribution of earnings are indicators of a nation’s economic well-being. Changes in the level of real earnings (i.e., actual earnings adjusted for inflation) show how a worker’s buying power has changed over time. Changes in the distribution of earnings show how the buying power of different workers has changed over time. Real earnings and the distribution of earnings affect several public policy issues. For example, increased real earnings can expand the Social Security taxable wage base, which can reduce the future need for higher Social Security payroll taxes or cuts in benefits. Higher real earnings can also help pay for future Medicare benefits. Conversely, lower real earnings can make it more difficult to finance the Social Security and Medicare programs. The level of real earnings can affect the national poverty rate and, therefore, federal spending on welfare and assistance for food, housing, health care, and energy. The federal minimum wage can affect the real earnings of lower-wage workers, as well as the overall distribution of earnings. In large part, real earnings depend on the amount of investment per worker — in the form of both human capital (e.g., education and health care) and physical capital (e.g., computers and other equipment). Investment depends on personal, business, and government saving. Thus, federal budget deficits or surpluses can affect the national saving rate and the amount of investment per worker. Government spending and tax policy can also affect earnings. Federal support for research and development can affect real earnings through the development of new goods and services and more productive technologies. Tax policy can affect decisions to save and invest, as well as the aftertax distribution of earnings. Policies that affect personal saving and the availability of private pension benefits can affect retirement income and reliance on Social Security benefits. Policies that influence the availability of private health insurance can affect federal spending on health care. Rules on immigration can affect both real earnings and the distribution of earnings. An increased supply of unskilled foreign workers can lower the wages of less-skilled U.S. workers and increase inequality. Conversely, an increased supply of skilled foreign workers can lower the wages of skilled American workers and reduce inequality. Similarly, trade policy can affect both real earnings and the CRS-2 distribution of earnings. Increased imports from low-wage countries can raise the living standards of U.S. households but affect the wages of domestic workers who produce competing goods and services. Increased exports of goods produced in the United States can raise the wages of American workers. Finally, differences in earnings among racial or ethnic groups or extremes in inequality can affect popular support for major social, political, and economic institutions. Organization of Report This report examines the trends in real weekly earnings and the distribution of weekly earnings in the United States from 1979 to 2006. The report provides separate analyses for men and women.1 The report begins with a definition of earnings and a summary of the findings in this report. Next, the paper discusses broad policies to increase real earnings or reduce inequality. The last part of the report provides a detailed summary of the findings. The report analyzes individual earnings. A study of individual income or of family earnings or income may reach different conclusions.2 The report does not review research on the causes of changes in real earnings or inequality.3 The Definition of Earnings The results of an analysis of real earnings and the distribution of earnings are affected by the definition of earnings, whose earnings are studied (e.g., all workers, full-time workers, prime-age workers, or others), the measure of inequality, and the time period studied. Earnings are payments that individuals receive for their labor services. Individuals may be paid for a period of time worked (e.g., an hourly wage or weekly salary) or the quantity of goods or services produced (e.g., a piece rate). Earnings 1 In addition to real earnings and the distribution of earnings, economists also study earnings mobility, or how the earnings of a given sample of workers change over time. Because of mobility, the distribution of lifetime earnings may differ from the distribution of annual or weekly earnings. 2 3 Earnings account for the largest share of individual and family income. Hearings during the first session of the 110th Congress examined the trends and causes of inequality. See U.S. Congress, House, Committee on Ways and Means, Hearing on the Economy, January 23, 2007, available at [http://waysandmeans.house.gov]; U.S. Congress, House, Committee on Education and Labor, Strengthening America’s Middle Class: Evaluating the Economic Squeeze on America’s Families, January 31, 2007, available at [http://edworkforce.house.gov]; U.S. Congress, House, Committee on Ways and Means, The Challenges Facing Middle-Class Families, January 31, 2007, available at [http://waysand means.house.gov]; and U.S. Congress, Joint Economic Committee, Ensuring Our Economic Future by Promoting Middle-Class Prosperity, January 31, 2007, available at [http://jec.senate.gov]. CRS-3 may be defined as cash wages or as total compensation. The latter consists of cash wages plus fringe benefits such as employer-provided health insurance, employer contributions to a retirement plan, and paid sick leave and vacations. The results of an analysis of individual earnings would differ from a study of individual compensation or income or of family earnings or income.4 Many individuals and families receive cash or in-kind benefits from sources other than work (e.g., interest, dividends, rent, cash welfare assistance, refundable tax credits, or in-kind benefits such as food, housing, or health care).5 Some families have more wage earners than other families. This report analyzes individual weekly earnings, where earnings consist of cash wages before taxes or other deductions. Individual earnings consist of total annual earnings from all jobs. Weekly earnings are annual earnings divided by the number of weeks worked. The analysis includes wage and salary workers and self-employed workers age 16 or older. Because there are differences in the labor market characteristics of men and women, the earnings of men and women are analyzed separately.6 The analysis uses data from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). The CPS is a household survey conducted by the Census Bureau for the Bureau of Labor Statistics (BLS). The annual supplement asks workers how much they earned the previous year. Thus, the 2007 supplement collected earnings information for 2006. The Appendix includes a full explanation of the data and methodology used in this report. Finally, the report analyzes the earnings of two groups of workers: (1) all workers and (2) workers employed full-time, year-round. “All” workers include persons employed either full-time or part-time as well as workers who worked either part of the year or all year. Full-time workers are persons who work 35 or more hours a week. Year-round workers are persons who work 50 or more weeks a year. 4 The distribution of earnings may change even though the distribution of total compensation does not change; e.g., if workers choose to receive a greater or smaller share of compensation as wages or if employers raise or lower their contributions for health insurance or retirement benefits. For analyses of the distribution of household income, see CRS Report RS20811, The Distribution of Income, by Brian W. Cashell; CRS Report RL32639, Inequality in the Distribution of Income: Trends and International Comparisons, by Brian W. Cashell; and U.S. Department of Commerce, Bureau of the Census, Income, Poverty, and Health Insurance Coverage in the United States: 2005, P60-231, August 2006, available at [http://www.census.gov/prod/2006pubs/p60-231.pdf]. 5 The results of an analysis of the distribution of earnings would differ from an analysis of the distribution of income if income from transfer payments or from savings and investments rise or fall. In addition, a change in nonlabor income may affect earnings (i.e., decisions to work or how much to work). 6 In general, women tend to work fewer hours per week than men, spend less time in the labor force, and enter and leave the labor force more often than men. The distribution of women by occupation and industry also differs from men. See CRS Report 98-278, The Gender Wage Gap and Pay Equity: Is Comparable Worth the Next Step?, by Linda Levine. CRS-4 Analyzing the earnings of full-time, year-round workers helps control for changes in hours worked per week, temporary and seasonal employment, and spells of unemployment. From 1979 to 2006, the percentage of workers employed fulltime, year-round increased by 12.1 percentage points (from 56.4% in 1979 to 68.5% in 2006). (See Figure 1.) Both the percentage of workers employed full-time and the percentage of workers employed full-time, year-round tend to dip during recessions. From 1979 to 2006, there were recessions from January to July 1980, July 1981 to November 1982, July 1990 to March 1991, and March to November 2001.7 Figure 1. Percentage of Full-Time Workers and Full-Time, Year-Round Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). 7 National Bureau of Economic Research (NBER), Business Cycle Dates and Contractions, available at [http://www.nber.org/cycles.html]. For a discussion of the economic recovery following the 2001 recession, see CRS Report RL32047, The ‘Jobless Recovery’ From the 2001 Recession: A Comparison to Earlier Recoveries and Possible Explanations, by Marc Labonte and Linda Levine. CRS-5 Summary of Findings All Workers ! From 1979 to 2006, the average real weekly earnings (i.e., earnings adjusted for inflation) of all workers increased by 23.7%. Real earnings increased at all percentiles.8 The increase was greatest for workers at the 95th percentile (37.1%). From 2001 to 2006, earnings at the 95th percentile fell by 2.4%. ! At all earnings levels, from 1979 to 2006, men earned more than women. But the earnings gap between men and women narrowed over the 27-year period. The earnings of women increased at all earnings levels. But the earnings of men at the 20th, 40th, and 60th percentiles were relatively unchanged. ! Workers with higher earnings are more likely to have employmentbased health insurance coverage. The CPS has consistent information on health insurance coverage from 1987 to the present. From 1987 to 2006, the percentage of workers with employmentbased health insurance coverage declined at all quintiles.9 The decrease was generally greater for lower-wage workers. During the 19-year period, insurance coverage generally declined from 1987 to the early 1990s, then was relatively stable or increased to about 2000, and then declined again from about 2000 to 2006. ! From 1987 to 2006, employment-based health insurance coverage declined for both men and women. The decrease was greatest for lower-wage workers. In addition, except at the lowest quintile, the decline in coverage was greater for men than women. ! Higher-wage workers are more likely to participate in an employeror union-provided pension plan. However, from 1979 to 2006, participation in an employer or union pension plan increased for lower-wage workers but decreased for higher-wage workers. The improved participation among lower-wage workers was due to increased participation among women. Participation generally declined from the early to late 1980s, increased from the late 1980s to about 2000, and declined from about 2000 to 2006. ! As measured by the Gini coefficient, inequality increased among all workers over the period from 1979 to 2006. Inequality increased 8 If workers are ranked from lowest to highest paid, workers at the 20th percentile earn more than 20% of workers, workers at the 40th percentile earn more than 40% of workers, and so on. 9 If workers are ranked from lowest to highest paid and then divided into five equal-size groups, each group is a quintile. CRS-6 among both men and women. Over the 27-year period, inequality generally increased from 1980 to 1986, then declined slightly from 1986 to 1992, before rising again from 1992 to 1994. Inequality generally fell from 1995 to about 1999, and then increased again from 1999 to 2005. Inequality decreased from 2005 to 2006, but it increased among women and decreased among men. ! During the period from 1979 to 2006, when inequality increased it was generally because workers in the bottom four quintiles received a smaller share of total weekly earnings, while workers in the top quintile received a larger share. Conversely, when inequality declined, it was generally because workers in the lower and middle quintiles received a larger share of earnings, while workers in the top quintile received a smaller share. Full-Time, Year-Round Workers ! From 1979 to 2006, the average real weekly earnings of full-time, year-round workers increased by 15.4%. The earnings of lowerwage men (i.e., 20th and 40th percentiles) fell by almost 10%, while the earnings of women at the 20th and 40th percentiles increased by 10.4% and 20.2%, respectively. ! Higher earning full-time, year-round workers are more likely to be covered by employment-based health insurance. But, from 1987 to 2006, coverage declined at all quintiles. The decrease was greatest among lower-wage workers. The decline in coverage for lowerwage full-time, year-round workers was greater at both the beginning and end than in the middle of the period from 1987 to 2006. ! From 1987 to 2006, employment-based health insurance coverage declined for both men and women. The decrease was greatest for lower-wage workers. Except for the top 5% of earners, the decrease was greater for men than women. ! Higher-wage full-time, year-round workers are more likely to participate in an employer- or union-provided pension plan. Except for the top 5% of earners, however, participation in employer- or union-provided pension plans declined at all quintiles. Participation fell for both women and men. Except at the top quintile, participation fell more among men than women. Participation generally fell from the early to late 1980s, increased from the late 1980s to about 2000, and declined again from about 2000 to 2006. ! The distribution of earnings among workers employed full-time, year-round is more equal than the distribution of earnings among all workers. But, from 1979 to 2006, inequality also increased among full-time, year-round workers. Inequality increased among both men and women. During the 27-year period, inequality generally CRS-7 increased from 1980 to 1986, declined slightly from 1986 to 1992, increased from 1992 to 1994, increased from 1995 to 1996, fell from 1996 to 1999, and increased again from 1999 to 2006. Although overall inequality did not change from 2005 to 2006, it increased among women. Policies to Increase Real Earnings or Reduce Inequality A variety of policies are available to increase real earnings or reduce earnings inequality. Policies to increase real earnings may differ from policies to reduce inequality. In some cases, the policies may conflict. Some of the policies may have mainly short-term effects. Other policies may require a longer-term commitment. Real Earnings Productivity. Real earnings rise with increased productivity. Policies to increase productivity may include plans to raise both private and public saving, increase capital investment per worker, expand investment in human capital (e.g., education, training, and health care), and encourage the development of technology. Technological innovation may include improved equipment, the introduction of new products, or improved methods of production, transportation, or communication.10 Economic Efficiency. Another way to increase real earnings is to improve economic efficiency. According to standard economic theory, competitive markets generally result in the most efficient allocation of resources, where resources consist of individuals with different skills, capital goods (e.g., computers, machinery, and buildings), and natural resources. A more efficient allocation of resources generally results in greater total output and consumer satisfaction. Economic efficiency can be improved through policies that provide consumers with greater access to goods and services (e.g., improved infrastructure to exchange goods and services and expanded trade) and a better allocation of labor and capital (e.g., neutral tax policies, migration, or the deregulation of labor, product, or other markets). Inequality Inequality may be reduced using either direct or indirect policies. Direct policies include income transfer programs. Indirect policies consist of plans that improve the income-producing human capital of lower-skilled workers (e.g., 10 Improved technology may allow for greater outsourcing of both manufacturing and service jobs, which may or may not affect the distribution of domestic earnings. See CRS Report RL32292, Offshoring (a.k.a. Offshore Outsourcing) and Job Insecurity Among U.S. Workers, by Linda Levine and CRS Report RL32484, Foreign Outsourcing: Economic Implications and Policy Responses, by Craig K. Elwell. CRS-8 education, training, or health care). Efforts to reduce inequality may involve a tradeoff, however, with initiatives to improve economic efficiency. Indirect Policies. Inequality can be reduced with policies that reduce the relative supply of less-skilled labor, increase the relative supply of skilled labor, or both. Such policies may include improved investment in preschool, grade school, and high school education, better adult education, and improved access to health care for lower income workers and their families. Inequality may also be reduced by increasing the relative supply of college-educated workers; for example, proposals to lower the cost of higher education or increase educational assistance to lower income students. Some policies may be more cost effective than others. Immigration policies that allow more skilled workers, fewer unskilled workers, or both, into the country can also reduce inequality. Direct Policies. Income inequality may also be reduced through income redistribution programs. These programs include policies such as progressive taxation — including refundable tax credits like the Earned Income Tax Credit (EITC) or the Child Tax Credit (CTC). They also include in-kind transfers of food, housing, and health care. Tradeoff with Economic Efficiency. Competitive markets may allocate resources efficiently, but they may result in significant earnings inequality. Thus, policies that reduce inequality may involve a tradeoff with proposals to improve economic efficiency. Some economists argue that a higher minimum wage, making it easier for workers to unionize, or different trade policies may reduce inequality. Other economists maintain that these policies may reduce total economic output and may not have a significant impact on inequality. Similarly, some economists argue that high marginal tax rates and income redistribution programs may harm economic efficiency. For example, high tax rates may discourage saving and investment. Transfer payments or other forms of nonlabor income may reduce the supply of labor (i.e., they may affect decisions to work or how much to work). Macroeconomic Policies. Fiscal and monetary policies that reduce or maintain low unemployment may also affect the distribution of earnings. During an economic expansion, the number of hours worked or the hourly wages of lower-wage workers often improve relative to other workers. Fiscal policy consists of government spending and revenue decisions. Monetary policy consists of actions by the Federal Reserve Bank that affect money supply and interest rates.11 The Trend in Real Weekly Earnings The remainder of this report provides a detailed description of the findings summarized above. This section examines the trend in real weekly earnings from 1979 to 2006. Earnings are for both wage and salary workers and self-employed workers. Nominal, or actual, earnings are adjusted for inflation using the Consumer Price Index for All Urban Consumers, adjusted to take into account the current 11 Fiscal policy (i.e., budget surpluses or deficits) may also affect interest rates. CRS-9 methods for measuring changes in prices (CPI-U-RS). An explanation of this index is provided in the Appendix. This section shows the trend in real weekly earnings for workers at the 20th, 40th, 60 , 80th, and 95th percentiles. If workers are ranked from lowest to highest paid, those at the 20th percentile earn more than 20% of workers, those at the 40th percentile earn more than 40% of workers, and so on. All of the results in this section are shown using graphs. All data used for these graphs are provided in the Appendix. th All Workers From 1979 to 2006, the average real weekly earnings of all employed persons increased by 23.7%. Earnings increased for workers at all percentiles. See Figure 2.12 The increase was greatest for workers at the 95th percentile. For example, for workers at the 20th percentile, earnings increased from $237 to $288 per week (or 21.5%). For workers at the 95th percentile, earnings increased from $1,543 to $2,115 a week (or 37.1%). However, from 2001 to 2006, the earnings of workers at the 95th percentile fell by 2.4% (from $2,167 to $2,115). Figure 2. Real Weekly Earnings, All Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). 12 Because of changes in topcoding in the CPS that affected the change in average earnings from 1994 to 1995, average earnings are not shown in Figure 1 or in the other figures in this report that show trends in real weekly earnings. Since the reported change in earnings from 1994 to 1995 cannot be separated into the effects of the change in topcoding and any actual change in earnings, in Tables 1 (a and b) and 2 (a and b) the percentage change in average earnings from 1979 to 2006 is the sum of the changes in average earnings from 1979 to 1994 and from 1995 to 2006. See the discussion of “Topcoded Earnings” later in this report. CRS-10 Figures 3 and 4 show two differences in the real weekly earnings of men and women. First, at each percentile, the earnings of men were greater than the earnings of women. For example, in 2006, men at the 20th percentile had earnings of $350 a week, compared to $231 for women. At the 60th percentile men and women earned $865 and $597, respectively. At the 95th percentile, men earned $2,538 a week, compared to $1,654 a week for women. Over the period from 1979 to 2006, average real weekly earnings increased more for women than men (48.0% and 14.7%, respectively). The increase was greater for women than men at all earnings levels. Thus, over the 27-year period, the earnings gap between men and women narrowed. At the 20th, 40th, and 60th percentiles, the increase in earnings among all workers was due almost entirely to higher earnings among women. The earnings of men at the 20th, 40th, and 60th percentiles were relatively unchanged. But, for women, earnings increased by 36.2%, 33.9%, and 40.2%, respectively. (See Tables 1a and 1b in the Appendix.) Figure 3. Real Weekly Earnings, All Male Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). CRS-11 Figure 4. Real Weekly Earnings, All Female Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). The narrowing of the earnings gap between men and women may have been caused by a number of reasons. Women’s hourly wages may have increased. They may have worked more hours. Gains in educational attainment and work experience may have helped narrow the gap. More women may have entered traditionally male occupations.13 Full-Time, Year-Round Workers From 1979 to 2006, the average real weekly earnings of full-time, year-round workers increased by 15.4%. But the trend in real weekly earnings of workers employed full-time, year-round differed from the pattern of earnings for all workers. 13 ! The earnings of full-time, year-round workers are higher than the earnings of all workers. (Compare Figures 2 and 5.) ! From 1979 to 2006, the earnings of workers employed full-time, year-round increased less than the earnings of all workers. For e xample, for full-time, year-round workers, earnings at the 20th percentile increased by 1.2% compared to an increase of 21.5% for all workers. For more discussion on the reasons for the narrowing of the wage gap between men and women, see CRS Report 98-278, The Gender Wage Gap and Pay Equity: Is Comparable Worth the Next Step?, by Linda Levine. CRS-12 ! From 1979 to 2006, the earnings of lower-wage men employed fulltime, year-round fell by almost 10%. At the 20th and 40th percentiles, the earnings of men fell by 9.6% and 9.8%, respectively. Figure 5. Real Weekly Earnings, Full-Time, Year-Round Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). As was the case with all workers, the average real weekly earnings of women employed full-time, year-round increased more than the earnings of men (41.3% and 9.6%, respectively). At all percentiles, the earnings of women increased more than the earnings of men. For example, compared to the decline in earnings among men at the 20th and 40th percentiles, the earnings of women increased by 10.4% and 20.2%, respectively. (Compare Figures 6 and 7.) CRS-13 Figure 6. Real Weekly Earnings, Male Full-Time, Year-Round Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). Figure 7. Real Weekly Earnings, Female Full-Time, Year-Round Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). CRS-14 Fringe Benefits Total compensation consists of wages and fringe benefits. This section examines the trends in employment-based health insurance and pension coverage. Employment-based coverage consists of health insurance or pension plans provided by an employer or union. Workers who are not covered by an employment-based health insurance plan may purchase insurance from a private insurance company, or they may be covered by public insurance (e.g., Medicaid or Medicare). Workers may also contribute to an Individual Retirement Account (IRA).14 This report only takes into account employment-based health insurance and pension plans. The report does not examine the amount that employers contribute toward fringe benefits. For the analysis in this section, workers are divided into quintiles. Workers are first ranked from lowest to highest paid. Workers are then divided into five equalsize groups, or quintiles. The top quintile is further divided into two groups: the top 5% of earners and the top 81% to 95% of earners. Employment-Based Health Insurance The CPS has consistent information on employment-based health insurance coverage from 1987 to the present. However, because of changes in the survey, some of the data since 1987 are not entirely comparable. For example, in 1994 the health insurance questions in the CPS were redesigned.15 These changes resulted in higher estimates of the number of persons with employment-based health insurance. The reported change in health insurance coverage between 1993 to 1994 cannot be separated into the effects of the change in the health insurance questions and any actual change in health insurance coverage. Therefore, in Figures 8 and 9, the period from 1987 to 2006 is separated into two subperiods: 1987 to 1993 and 1994 to 2006. Also, in this section of the report and in Tables 3 and 4 (a and b) in the Appendix, the changes in coverage from 1987 to 2006 are the sum of the percentage point changes over each of the two subperiods; that is, the sum of the percentage point change from 1987 to 1993 and the change from 1994 to 2006.16 This approach is 14 For information on the types of IRAs, see CRS Report RL31770, Individual Retirement Accounts and 401(k) Plans: Early Withdrawals and Required Distributions, by Patrick Purcell. 15 U.S. Census Bureau, Income, Poverty, and Health Insurance Coverage in the United States: 2006, Current Population Reports, P60-233, U.S. Govt. Print. Off., August 2007, available at [http://www.census.gov/prod/2007pubs/p60-233.pdf], p. 58. 16 Other changes in the CPS may affect the comparability of health insurance data over time. The Census Bureau has released revised data on health insurance coverage for the years 1996 to 2005. Because of these revisions, the estimated number of persons with employment-based health insurance increased slightly. This report does not take these revisions into account. Also, in 2000, the CPS added questions to verify that people who answered “no” to all questions about specific types of insurance were actually uninsured. This change also increased slightly the estimated number of persons with employment-based health insurance. Cheryl Hill Lee and Sharon M. Stern, Health Insurance Estimates from the U.S. Census Bureau: Background for a New Historical Series, U.S. Census Bureau, (continued...) CRS-15 equivalent to raising the percentage of workers with health insurance coverage in 1987 (or lowering the percentage with coverage in 2006) by the reported change in coverage between 1993 and 1994.17 All Workers. Three features characterize the trend in employment-based health insurance coverage from 1987 to 2006.18 ! Workers with higher earnings are more likely to have health insurance. For example, in 2006, 84.6% of the top 5% of earners had coverage, compared to 47.2% of workers in the lowest quintile. ! From 1987 to 2006, the percentage of workers with coverage declined at all quintiles. ! The decline in coverage was greatest for lower-wage workers. (See Figure 8.) For example, at the lowest quintile, the percentage of workers with health insurance fell by 9.1 percentage points, compared to a 5.3 percentage point decline for the top 5% of earners.19 During the 19-year period, employment-based health insurance coverage generally declined from 1987 to the early 1990s, was relatively stable or increased to about 2000, and then declined again from about 2000 to 2006. For example, at the second, third, and fourth quintiles, the percentage of workers with employment-based health insurance declined from 1987 to 1993, increased from 1994 to 2000, and then declined from 2000 to 2006. From 1987 to 2006, employment-based health insurance coverage declined among both men and women. Among men, the decline in coverage by quintile ranged from 6.1 to 8.3 percentage points. Among women, coverage at the lowest quintile fell by 10.1 percentage points. Otherwise, the decline in coverage ranged from 1.4 to 4.0 percentage points. At the lowest quintile, although coverage declined 16 (...continued) June 2007, at [http://www.census.gov/hhes/www/hlthins/usernote/revhlth_paper.pdf], pp. 8, 16. 17 For additional information on health insurance issues, see CRS Report RL32237, Health Insurance: A Primer, by Bernadette Fernandez; CRS Report RL34389, Health Insurance Reform and the 110th Congress, by Jean Hearne; and CRS Report RS22735, Spending by Employers on Health Insurance: A Data Brief, by Jennifer Jenson. 18 The analysis in this report is of employment-based health insurance coverage only. It does not include coverage of self-employed persons. The self-employed may have private health insurance if they purchase an individual policy or they are covered under someone else’s policy. For more information on health insurance coverage, see CRS Report 96-891, Health Insurance Coverage: Characteristics of the Insured and Uninsured Populations in 2006, by Chris L. Peterson and April Grady. 19 Unless stated otherwise, the comparisons of percentage differences or changes discussed in this report are significant at either the 95% or 90% confidence levels. See the Appendix for an explanation of confidence levels. CRS-16 for both men and women (8.1 and 10.1 percentage points, respectively), coverage among men averaged almost 8 percentage points lower than among women. (See Tables 3a and 3b in the Appendix.) Figure 8. Employment-Based Health Insurance Coverage, All Workers, by Quintile, 1987-2006 Source: CRS analysis of data from the Current Population Survey (CPS). Note: Because of changes in the design of the health insurance questions in 1994, the percentage of workers with employment-based health insurance is separated into two subperiods: 1987-1993 and 1994-2006. Full-Time, Year-Round Workers. Figure 9 shows the percentage of fulltime, year-round workers with employment-based health insurance. Again, workers with higher earnings are more likely to be covered by employment-based health insurance. On the other hand, from 1987 to 2006, the percentage of full-time, yearround workers with employment-based health insurance declined at all quintiles. The decline was greatest for lower-wage workers. At the lowest quintile, coverage fell by 10.8 percentage points, compared to a 5.6 percentage point decrease among the highest earners. As was the case with all workers, from 1987 to 2006, the decline in coverage was greater at both the beginning and end than in the middle of the period. From 1987 to 2006, employment-based health insurance coverage declined among both men and women employed full-time, year-round. The decrease was greatest for lower-wage workers. Except for the top 5% of earners, the decrease was greater for men than women. At the lowest quintile, health insurance coverage fell by 12.3 percentage points among men, compared to a 7.1 percentage point drop among women. At the second quintile, the decline in coverage among men was 11.8 percentage points, compared to a 9.3 percentage point decrease among women. (See Tables 4a and 4b in the Appendix.) CRS-17 Figure 9. Employment-Based Health Insurance Coverage, Full-Time, Year-Round Workers, by Quintile, 1987-2006 Source: CRS analysis of data from the Current Population Survey (CPS). Note: Because of changes in the design of the health insurance questions in 1994, the percentage of workers with employment-based health insurance is separated into two subperiods: 1987-1993 and 1994-2006. Employer- or Union-Provided Pension Plans All Workers. Workers with higher earnings are more likely to participate in an employer- or union-provided pension plan. In 2006, 60.9% of the top 5% of earners were covered by such a plan, compared to 9.7% of workers in the lowest quintile. Relative to higher-wage workers, however, participation among lower-wage workers in an employer- or union-provided pension plan improved from 1979 to 2006.20 At the lowest quintile, participation increased by 2.4 percentage points (from 7.4% to 9.7%, rounded21), but declined by 4.0 percentage points (from 64.9% to 60.9%) among the top 5% of earners. The improved participation of lower-wage workers was due to increased participation among women. At the lowest quintile, 20 The analysis in this section includes wage and salary workers in both the private and public sectors as well as self-employed workers. Public sector and self-employed workers are not covered by the Employee Retirement Income Security Act of 1974 (ERISA, P.L. 93406), which is the federal law that governs employer-provided pension plans. For more information on pension plan coverage, see CRS Report RL30122, Pension Sponsorship and Participation: Summary of Recent Trends, by Patrick Purcell. 21 Although coverage increased by 2.4 percentage points from 1979 to 2006, coverage rounds to 7.4% in 1979 and 9.7% in 2006. CRS-18 there was no change in participation among men, but a 3.5 percentage point increase (from 5.3% to 8.8%) among women. At the second quintile, participation among men fell by 5.6 percentage points (from 31.8% to 26.2%), but increased by 4.1 percentage points (from 18.0% to 22.1%) among women. (See Figure 10 and Tables 5a and 5b in the Appendix.) Although there was some variation from year-to-year, during the period from 1979 to 2006, participation in an employer or union pension plan generally declined from the early to late 1980s, increased from the late 1980s to about 2000, and declined again from about 2000 to 2006. Figure 10. Participation in an Employer-or UnionProvided Pension Plan, All Workers, by Quintile, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). Full-Time, Year-Round Workers. For full-time, year-round workers, the trend in participation in an employment-based pension plan differed from the trend for all workers. CRS-19 ! Lower-wage full-time, year-round workers were more likely than all lower-wage workers to participate in an employer or union pension plan. At the first and second quintiles in 2006, 21.4% and 40.2% of full-time, year-round workers were participants in an employer or union pension plan, compared to 9.7% and 25.6% of all workers. ! Among full-time, year-round workers, except for the top 5% of earners, participation declined at all quintiles from 1979 to 2006. ! Participation fell for both women and men.22 Except at the top quintile, participation fell more among men than women. At the lowest quintile, participation among men fell by 10.0 percentage points from 1979 to 2006 (from 28.7% to 18.7%), compared to a 4.0 percentage point drop (from 27.3% to 23.3%) among women. Similar to the trend among all workers, participation generally fell from the early to late 1980s, increased from the late 1980s to about 2000, and declined again from about 2000 to 2006. (See Figure 11 and Tables 6a and 6b in the Appendix.) Figure 11. Participation in an Employer- or UnionProvided Pension Plan, Full-Time, Year-Round Workers, by Quintile, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). 22 The decrease among the top 5% of male earners was not statistically significant. CRS-20 The Distribution of Weekly Earnings This section examines the trend in the distribution of weekly earnings from 1979 to 2006. Different measures of inequality provide different information and can lead to different conclusions about the trend in the distribution of earnings. Most measures identify whether inequality has changed over time or differs among groups. But some measures may not reveal how inequality has changed or differs. This report uses two measures of inequality: the Gini coefficient and the share of total weekly earnings received by each quintile of workers. Together, the two measures show whether the distribution of earnings has changed and, if so, how it changed. Topcoded Earnings To protect the confidentiality of survey participants, the CPS topcodes earnings. Changes in topcoding can affect the observed trend in inequality. In the CPS, total earnings consist of wages and salaries and earnings from farm and nonfarm self-employment. Wages and salaries are further separated into earnings from a worker’s longest job and “other” wage and salary earnings. In 1995, each of the four types of earnings was topcoded at $99,999. Beginning in 1996, each component of total earnings has been given a unique topcode. Currently, the top code for earnings from a worker’s longest job is $200,000. The topcode for “other” wages and salaries is $35,000. If someone’s longest job was as a wage and salary worker, but they also have earnings from self-employment, the topcode from selfemployment is $50,000. If the self-employment is farm income, the topcode is $25,000. Since 1996, for workers with earnings above the topcoded amounts, the CPS reports average earnings for workers with similar characteristics. The changes in topcoding from 1995 to 1996 can affect an analysis of inequality. For some workers, the changes may increase the amount of earnings reported in the CPS. For other workers, the changes may lower their reported earnings. For example, someone who had a salary of $125,000 in both the 1995 and 1996 surveys and who had no earnings from other sources, would have higher earnings reported in the 1996 survey. Their 1995 earnings would have been topcoded at $99,999, while the 1996 survey would have reported their actual earnings of $125,000.23 If this same person also had $75,000 of self-employment income from farming, the 1995 survey would have included all of their farm income (because all earnings variables were topcoded at $99,999). In the 1996 survey, their farm selfemployment income would have been topcoded at $25,000. Thus, their total earnings, as reported by the CPS, may have been lower in 1996 than in 1995 (i.e., $150,000 versus $174,999 — disregarding the averaging of earnings that are above the topcoded amounts). 23 In the 1996 CPS, earnings from a worker’s longest job were topcoded at $150,000. U.S. Census Bureau and Bureau of Labor Statistics, Differences Between the March 1995 and March 1996 Annual Demographic Files, available at [http://www.bls.census.gov/cps/ads/ 1996/sfiledif.htm]. CRS-21 Because of the effect that changes in topcoding can have on the analysis of inequality, in this section the graphical representation of the Gini coefficient is separated into two periods: 1979 to 1994 and 1995 to 2006. (Recall that the ASEC Supplement asks workers how much they earned the previous year.) In the graphs of the share of earnings received by quintile, the top 5% of workers are also separated into two periods. But the change in topcoding can also affect other workers. In the graphs below, the share of earnings received by workers in the 81st to 95th percentiles appears to fall between 1994 and 1995. In part, this may be due to changes in topcoding that reduced the amount of total earnings reported by some workers in the CPS. Gini Coefficient The Gini coefficient is a measure of earnings equality that ranges from 0 to 1. If the earnings of all individuals are the same, the Gini coefficient is equal to 0, representing complete equality. If one worker receives all the earnings and all other workers receive zero earnings, the Gini coefficient is equal to 1. Thus, a larger coefficient indicates a greater degree of inequality. More information on the Gini coefficient is provided in the Appendix. All Workers. Inequality increased among all workers over the period from 1979 to 2006. Inequality also increased among both men and women. Over the 27year period, however, there were periods when inequality went up and periods when it went down. In general, inequality increased from 1980 to 1986, then declined slightly from 1986 to 1992, before rising again from 1992 to 1994. Inequality fell from 1995 to about 1999 and then increased again from about 1999 to 2005. Inequality fell from 2005 to 2006. Within this overall pattern, there were some yearto-year variations in the trend in inequality. (See Figure 12.) Except for the periods from 1986 to 1992 and 2005 to 2006, the pattern of inequality from 1979 to 2006 was generally the same for both men and women. From 1986 to 1992, overall inequality declined slightly. But, among women and men, the changes in the Gini coefficient were not statistically significant, indicating that inequality among men and among women did not change. One explanation for this difference is that the narrowing in the gap in earnings between men and women reduced overall inequality, while the distribution of earnings among men and the distribution of earnings among women were unchanged. Although overall inequality decreased from 2005 to 2006, it increased among women and decreased among men. Full-Time, Year-Round Workers. The distribution of earnings among workers employed full-time, year-round is more equal than the distribution of earnings among all workers. Nevertheless, from 1979 to 2006, inequality also increased among full-time, year-round workers. Inequality increased among both men and women. (See Figure 13.) CRS-22 Figure 12. Gini Coefficient, All Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). Note: Because of changes in topcoding from 1994 to 1995, the Gini coefficient is separated into two subperiods: 1979-1994 and 1995-2006. Figure 13. Gini Coefficient, Full-Time, Year-Round Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). Note: Because of changes in topcoding from 1994 to 1995, the Gini coefficient is separated into two subperiods: 1979-1994 and 1995-2006. CRS-23 During the 27-year period from 1979 to 2006, the pattern of inequality among full-time, year-round workers was similar to the pattern among all workers. Inequality generally increased from 1980 to 1986, declined somewhat from 1986 to 1992, increased from 1992 to 1994, increased from 1995 to 1996, fell from 1996 to 1999, and then increased again from 1999 to 2006. The change in the Gini coefficient from 2005 to 2006 was not statistically significant. But inequality increased among women and was unchanged among men. For men and women, separately, the change in inequality from 1986 to 1992 differed from the overall pattern of inequality for all full-time, year-round workers. Although inequality declined among all full-time, year-round workers, it increased among women but was unchanged among men.24 One explanation for this difference is that, while the distribution of earnings among women became more unequal, the narrowing of the gap in earnings between men and women resulted in less inequality in the overall distribution of earnings. The Share of Total Weekly Earnings by Quintile The Gini coefficient shows whether the distribution of earnings has changed over time, but it does not show where the distribution may have changed. To examine where the earnings distribution may have changed, this section examines the share of total weekly earnings received by each quintile of workers. All Workers. An analysis of the share of total weekly earnings by quintile shows that inequality was greater in 2006 than in 1979. During the 27-year period, there were shorter-term periods of either rising or falling inequality. When inequality increased during the 27-year period, it was generally because workers in the bottom four quintiles received a smaller share of total weekly earnings, while workers in the top quintile received a larger share. Conversely, when inequality declined during the 27-year period, it was generally because workers in the lower and middle quintiles received a larger share of earnings, while workers in the top quintile received a smaller share. (See Figure 14.) The Gini coefficient showed that inequality increased from 1980 to 1986. During this period, the share of total earnings going to the bottom four quintiles declined, while the share going to the top quintile increased. The share of total weekly earnings received by the top 5% of earners increased by 2.1 percentage points (from 16.6% to 18.7%). Similarly, the Gini coefficient showed that inequality declined from 1995 to 1999 and increased from 1999 to 2006. From 1995 to 1999, the share of earnings received by the first four quintiles increased and then, except for the lowest quintile, decreased from 1999 to 2006. The share of earnings received by the top 5% of earners fell by 2.8 percentage points (from 29.0% to 22.1%, rounded) from 1995 to 1999 and then rose by 2.8 percentage points (from 22.1% to 24.9%) from 1999 to 2006. 24 Among women, the decrease in the Gini coefficient from 1995 to 1999 was not statistically significant. CRS-24 Figure 14. Share of Total Weekly Earnings by Quintile, All Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). Note: Because of changes in topcoding from 1994 to 1995, the share of earnings received by the top 5% of earners is separated into two subperiods: 1979-1994 and 1995-2006. Changes in topcoding may also affect the share of earnings received by workers in the 81st to 95th percentiles. Changes in the share of earnings received by men and women generally followed the same pattern as the trend for all workers. For example, from 1999 to 2006, the share of earnings received by the top 5% of male and female workers increased by 3.3 and 2.6 percentage points, respectively (from 22.0% to 25.3% and 19.8% to 22.5%, rounded). (See Tables 8a and 8b in the Appendix.) Full-Time, Year-Round Workers. Inequality increased among full-time, year-round workers from 1979 to 2006. Similar to the pattern among all workers, when inequality increased among full-time, year-round workers, the share of earnings received by the bottom four quintiles decreased, while the share received by the top quintile increased. Conversely, when inequality fell, the opposite happened. This was the pattern for both men and women who worked full-time, year-round. (See Figure 15.) Reasons for Changes in the Share of Total Weekly Earnings by Quintile. The share of earnings received by workers at each quintile may change for many reasons. The relative number of hours worked may change and relative earnings per hour may change. As discussed at the beginning of this report, both the percentage of workers employed full-time and the percentage of workers employed full-time, year-round tend to fall during recessions. During an economic expansion, CRS-25 as the demand for labor increases, both hours worked and earnings per hour often rise, especially among lower-wage workers.25 For example, the data on real weekly earnings in Tables 1a and 1b in the Appendix show that, when inequality fell from 1995 to 1999, the real weekly earnings for workers at the 20th percentile increased by 12.3%, compared to a 12.6% increase for workers at the 95th percentile. Conversely, when inequality increased from 1980 to 1986, earnings at the 20th percentile fell by 4.2%, but increased by 11.3% at the 95th percentile. Figure 15. Share of Total Weekly Earnings by Quintile, Full-Time, Year-Round Workers, 1979-2006 Source: CRS analysis of data from the Current Population Survey (CPS). Note: Because of changes in topcoding from 1994 to 1995, the share of earnings received by the top 5% of earners is separated into two subperiods: 1979-1994 and 1995-2006. Changes in topcoding may also affect the share of earnings received by workers in the 81st to 95th percentiles. Several other factors may also affect relative earnings. The supply of and demand for workers with different skills may change. Changes in consumer tastes or technology may affect the demand for labor. Social and demographic changes may affect the supply of labor. Changes in wages may affect both the demand for and the supply of labor. Congress may enact policies that affect earnings. For example, during the period from 1979 to 2006, Congress passed three laws that 25 During an economic expansion, in order to hire more workers, employers may offer higher wages. Employers may also ask workers to work, or require, more overtime. Both of these changes would increase total weekly earnings. CRS-26 raised the basic federal minimum wage.26 Following welfare reform in 1996, the employment of single mothers increased significantly.27 Regulatory changes or changes in trade policy may affect earnings. U.S. firms may engage in greater outsourcing. Foreign companies may increase production in the United States. Each of these changes may affect the distribution of workers in different occupations and industries. For example, the decline in manufacturing employment in the United States since 1979 (when employment peaked at 19.4 million) may have affected both wages and fringe benefits.28 Union membership in the United States, which also peaked in 1979 (at 21.0 million), may also have affected earnings and fringe benefits.29 Separating the effect of each of these (and other) factors on earnings and fringe benefits is difficult, however. In addition, economists may not agree on the effects of each factor. 26 The first law (P.L. 95-151) raised the minimum wage in January 1979, January 1980, and January 1981. The second law (P.L. 101-157) raised the wage in April 1990 and April 1991. The third law (P.L. 104-188) raised the wage in October 1996 and September 1997. In 2007, Congress enacted P.L. 110-28, which raised the minimum wage, in steps, beginning in July 2007. The current minimum wage is $5.85 an hour. It is scheduled to rise to $6.55 an hour in July 2008 and $7.25 an hour in July 2009. CRS Report RL33754, Minimum Wage in the 110th Congress, by William G. Whittaker. 27 Among other things, the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (P.L. 104-193) set a time limit on cash welfare assistance and imposed greater work requirements on welfare recipients. CRS Report RL32760, Temporary Assistance for Needy Families (TANF) Block Grant: Responses to Frequently Asked Questions, by Gene Falk. 28 From 1979 to 2006, employment in manufacturing in the United States fell from 19.4 million to 14.2 million, a decrease from 21.6% to 10.4% of total nonfarm employment. U.S. Department of Labor, Bureau of Labor Statistics, Employment, Hours, and Earnings from the Current Employment Statistics Survey, available at [stats.bls.gov/ces/home.htm]. 29 Research has concluded that union workers generally earn more than nonunion workers. CRS Report RL32553, Union Membership Trends in the United States, by Gerald Mayer. CRS-27 Appendix: Measures of Inequality, Data, and Methodology This Appendix provides a brief explanation of the measures of inequality used in this report. It also describes the source of data and the methodology used in the report. The second part of the Appendix shows the data used in the text and graphs in the report. Measures of Inequality This report uses two measures of inequality: the Gini coefficient and the share of earnings received by each quintile of workers. Gini Coefficient. The Gini coefficient is calculated using the following formula: where fi is the proportion of earners in interval I and pi is the proportion of total earnings received by earners in interval I and all lower intervals.30 Graphically, the Gini coefficient is illustrated in Figure 16. The horizontal axis shows the percent of all earners; the vertical axis shows the percent of earnings received by all earners. The diagonal line represents total earnings equality. For example, on the diagonal line, 25% of earners receive 25% of earnings, 50% of earners receive 50% of earnings, and so on. In Figure 16 the two dotted lines — called Lorenz curves — illustrate two possible earnings distributions. The Gini coefficient is the ratio of (a) the area between the diagonal line and the Lorenz curve and (b) the total area under the diagonal line. Figure 16 illustrates the distribution of earnings for two groups of workers (or the same group of workers at different times). The distribution of earnings for the first group (where the Gini coefficient is .163) is more equal than the distribution of earnings for the second group (where the Gini coefficient is .289). For the first group of workers, the bottom 60% of workers receive half of all earnings; the top 40% receive the other half of earnings. In the second group, the bottom 70% of earners receive half of all earnings; the top 30% receive the other half. 30 U.S. Bureau of the Census, Studies in the Distribution of Income, Series P60-183, 1992, p. 60. CRS-28 Share of Total Earnings by Quintile. To calculate the share of earnings received by each quintile of earners, workers are first ranked from lowest to highest paid. Workers are then divided into five equal-size groups, or quintiles. The total earnings received by each quintile is divided by the total earnings of all workers. If everyone’s earnings were the same, each quintile would receive one-fifth of all earnings. The greater the share of earnings received by the highest paid workers (i.e., the top quintile) or the smaller the share of earnings received by the lowest paid workers (i.e., the lowest quintile) the greater the degree of inequality. In this report, the top quintile of earners is further separated into two groups: the top 5% of earners and the top 81% to 95% of earners. Data Source and Methodology The analysis in this report uses data from the March Current Population Survey (CPS). The CPS is a household survey conducted by the U.S. Bureau of the Census for the Bureau of Labor Statistics (BLS) of the U.S. Department of Labor. The monthly CPS is the main source of labor force data for the nation, including estimates of the monthly unemployment rate. The CPS collects a wide range of demographic, social, and labor market information. Figure 16. Illustration of Lorenz Curves and Gini Coefficients for Two Groups of Workers Source: Illustration created by CRS. CRS-29 The Annual Social and Economic (ASEC) Supplement to the monthly CPS asks additional questions about individual earnings for the previous year. The sample is representative of the civilian noninstitutional population of the United States. The sample for the supplement includes members of the Armed Forces living in civilian housing units on a military base or in a household not on a military base. The sample does not include persons living in institutions (such as mental hospitals, nursing homes, or correctional facilities). The 2007 supplement interviewed about 76,100 households.31 The annual ASEC Supplement to the CPS collects earnings information for both wage and salary workers and self-employed persons. Some workers may have both wage and salary income and self-employment income. In addition, self-employed persons may have both wages and income or loss from investment in their business (e.g., in equipment, buildings, office space, materials, supplies, and other kinds of capital). Since wages cannot be negative, this report uses positive earnings only; i.e., it excludes persons whose investment losses were greater than their wage. But this approach may include investment losses if a person combines their wage and investment loss and their wage is greater than their investment loss. The approach may also include investment income, if a person reports his or her earnings as the total of their wage and investment income. Excluding persons with negative earnings has little or no effect on the real earnings by percentile shown in this report. Including persons with negative earnings increases the level of inequality, but has little or no effect on the trend in inequality. In Tables 1 and 2 (a and b), comparisons of real earnings between consecutive years should be made with caution. When answering the question about annual earnings, some respondents may round off their earnings. For example, many people may report that they earn $50,000 a year, when they earn either more or less than $50,000. From one year to the next, this rounding may affect the observed trend in real weekly earnings. CPI-U-RS. In this report, nominal weekly earnings were adjusted for inflation using the CPI-U-RS (the Consumer Price Index for all Urban Consumers Research Series). Over the years, BLS has introduced a number of changes in the way it measures changes in prices. Each improvement is intended to make the CPI-U more accurate. But the historical CPI-U is not adjusted to take the improvements into account. The CPI-U-RS adjusts the historical CPI-U (starting in 1978) to take into account most of the improvements made in measuring price changes. The CPI-U-RS shows what the CPI-U would have been if current methods had been used to measure inflation. Compared to the CPI-U, the CPI-U-RS provides a more consistent measure of 31 U.S. Census Bureau, Current Population Survey, 2007 Annual Social and Economic (ASEC) Supplement, available at [http://www.census.gov/apsd/techdoc/cps/cpsmar07.pdf], pp. 1-1, 9-3, G-2. CRS-30 inflation.32 From 1979 to 2006, the CPI-U-RS increased by 258.8%. The CPI-U increased by 277.7%. Topcoded Earnings. In the ASEC Supplement, if a person’s annual earnings exceed a certain amount, the individual’s actual earnings are not reported. Instead, BLS reports the average earnings of those persons whose earnings are above the topcoded amount. For 2006 (i.e., the 2007 ASEC), annual earnings from a person’s longest job were topcoded at $200,000, or $3,846.15 a week. BLS averages earnings for several groups of workers, based on gender, race, Hispanic origin, and work experience. For example, BLS calculates average earnings for all white, nonHispanic men who work full-time, year-round and whose earnings for their longest held job were over $200,000. To arrive at total annual earnings, this amount is added to any earnings from other employment (e.g., a person may have held more than one job during the year). In this report, topcoding may affect the measures of inequality in two ways. First, because of topcoding, the Gini coefficient may understate the degree of inequality. Topcoding should have less of an effect on the estimates of real weekly earnings or the estimates of the share of total weekly earnings by quintile. Second, as discussed in the text of this report, because of changes in topcoding in 1996 (affecting yearly earnings for 1995), the observed trend in inequality may not be comparable for years 1994 and earlier and years 1995 and later. Confidence Levels. Estimates based on survey responses from a sample of households have two kinds of error: nonsampling and sampling. Examples of nonsampling error include information that is misreported and errors made in processing collected information. Sampling error occurs because a sample, and not the entire population, of households is surveyed. The difference between an estimate based on a sample of households and the actual population value is known as sampling error. When using sample data, researchers typically construct confidence intervals around population estimates. Confidence intervals provide information about the accuracy of estimated values. With a 95% confidence interval and repeated samples from a population, 95% of intervals will include the average estimate of a population characteristic. Data Used in Text and Graphs The remainder of this Appendix provides the data used in the text and graphs in this report. 32 Stewart, Kenneth J, and Stephen B. Reed, “Consumer Price Index Research Series Using Current Methods, 1978-98,” Monthly Labor Review, vol. 122, June 1999, p. 29. CRS-31 Table 1a. The Trend in Real Weekly Earnings: All Workers, 1979-1994 Earnings 1979 1980 1981 1982 1983 1984 1985 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $631 237 414 621 946 1,543 $615 233 404 609 923 1,517 $612 219 407 608 912 1,483 $614 216 391 600 926 1,543 $615 216 387 594 925 1,535 $625 213 391 604 924 1,590 $638 220 410 619 962 1,608 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $801 343 597 846 1,145 1,842 $775 330 566 815 1,120 1,792 $774 319 545 818 1,106 1,796 $772 301 540 780 1,123 1,852 $771 296 536 777 1,110 1,850 $783 294 533 809 1,137 1,848 $796 302 536 822 1,168 1,890 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $415 169 299 426 597 936 $414 171 296 427 599 932 $410 164 292 417 614 941 $418 163 293 424 617 964 $426 161 296 444 631 999 $436 164 295 437 640 1,019 $449 168 305 447 679 1,031 1986 1987 All Workers $659 $662 223 228 405 421 641 653 995 980 1,688 1,633 Men $827 $821 311 313 557 555 844 816 1,181 1,205 2,025 1,959 Women $460 $475 169 170 307 323 467 483 681 712 1,097 1,143 1988 1989 1990 1991 1992 1993 1994 $669 226 416 646 989 1,647 $679 236 425 659 1,006 1,721 $667 233 431 645 992 1,697 $665 233 416 650 976 1,666 $667 238 422 650 987 1,706 $672 233 418 655 1,004 1,726 $688 237 414 647 1,024 1,811 $830 315 567 820 1,197 2,047 $837 314 564 834 1,208 2,113 $813 312 546 805 1,168 2,013 $807 301 547 805 1,166 2,064 $801 298 542 812 1,173 2,031 $806 294 528 793 1,189 2,114 $829 310 523 796 1,216 2,199 $482 171 315 476 724 1,150 $496 181 327 489 749 1,208 $497 179 328 489 739 1,208 $501 180 333 500 750 1,222 $511 188 328 514 758 1,239 $518 185 330 515 777 1,282 $526 187 336 517 776 1,294 CRS-32 Table 1b. The Trend in Real Weekly Earnings: All Workers, 1995-2006 Earnings 1995 1996 1997 1998 1999 2000 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $743 243 429 657 1,011 1,819 $743 246 443 664 1,009 1,846 $767 251 452 684 1,036 1,927 $798 261 475 713 1,069 1,948 $791 272 465 700 1,117 2,048 $835 281 487 721 1,126 2,049 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $911 303 531 808 1,213 2,162 $905 308 541 806 1,230 2,215 $938 321 566 843 1,227 2,361 $965 335 594 855 1,283 2,376 $961 347 582 880 1,326 2,420 $1,025 351 585 880 1,351 2,454 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $552 192 333 505 783 1,314 $559 197 345 517 787 1,353 $573 200 361 532 819 1,392 $609 214 371 570 831 1,433 $601 222 372 582 861 1,513 $622 225 399 585 901 1,531 2001 2002 All Workers $848 $853 285 280 491 496 730 750 1,117 1,121 2,167 2,155 Men $1,018 $1,038 344 345 592 603 876 862 1,314 1,345 2,519 2,586 Women $655 $645 228 233 399 410 592 603 876 897 1,594 1,588 2003 2004 2005 2006 Percent Change, 1979-2006 $849 275 502 738 1,138 2,108 $837 277 493 718 1,129 2,053 $852 286 497 723 1,136 2,113 $852 288 481 750 1,154 2,115 23.7% a 21.5% 16.1% 20.7% 22.0% 37.1% $1,013 347 590 877 1,370 2,530 $1,007 347 595 862 1,334 2,556 $1,026 346 596 858 1,343 2,582 $1,013 350 577 865 1,346 2,538 14.7% a 2.0% -3.4% 2.3% 17.6% 37.8% $663 229 417 611 914 1,623 $644 226 411 616 907 1,601 $654 238 397 596 914 1,589 $669 231 400 597 938 1,654 48.0% a 36.2% 33.9% 40.2% 57.0% 76.7% Source: Calculated by CRS from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). Note: Weekly earnings are in 2006 dollars. Estimates are for persons age 16 and over. a. Because of changes in topcoding that affected the change in average earnings between 1994 and 1995, the percent change in average real weekly earnings from 1979 to 2006 is the sum of changes from 1979 to 1994 and 1995 to 2006. CRS-33 Table 2a. The Trend in Real Weekly Earnings: Full-Time, Year-Round Workers, 1979-1994 Percentile 1979 1980 1981 1982 1983 1984 Average Earnings $798 20th Percentile 418 40th Percentile 597 60th Percentile 796 80th Percentile 1,095 95th Percentile 1,742 $776 412 582 791 1,075 1,702 $778 409 573 777 1,064 1,668 $781 390 579 772 1,080 1,736 $778 392 558 770 1,088 1,769 $796 391 569 782 1,066 1,777 Average Earnings $931 20th Percentile 518 40th Percentile 747 60th Percentile 956 80th Percentile 1,244 95th Percentile 1,991 $904 497 717 932 1,210 1,926 $912 491 712 925 1,227 1,964 $915 478 694 926 1,235 1,967 $909 481 703 925 1,239 1,961 $932 473 711 924 1,244 2,033 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $542 336 448 538 717 1,021 $539 327 437 552 732 1,023 $556 335 444 579 748 1,058 $564 333 444 573 740 1,110 $573 338 457 581 782 1,103 $543 348 448 548 717 995 1985 1986 1987 1988 All Full-Time, Year-Round Workers $805 $824 $825 $827 412 405 407 409 584 607 588 598 794 810 816 819 1,100 1,148 1,143 1,134 1,752 1,856 1,828 1,890 Men $938 $960 $958 $959 481 484 490 472 687 709 718 724 945 979 980 945 1,271 1,316 1,306 1,298 2,062 2,190 2,122 2,205 Women $588 $606 $616 $624 344 338 343 346 464 473 490 472 601 608 620 630 806 830 820 850 1,155 1,212 1,224 1,260 1989 1990 1991 1992 1993 1994 $836 418 604 815 1,154 1,932 $812 403 575 805 1,137 1,869 $811 403 583 805 1,111 1,888 $818 406 596 812 1,137 1,895 $816 396 581 793 1,136 1,955 $826 390 592 802 1,164 2,005 $966 483 725 966 1,328 2,264 $928 460 690 920 1,294 2,157 $929 462 694 944 1,289 2,138 $934 460 677 948 1,305 2,166 $927 449 661 925 1,321 2,246 $935 445 664 915 1,294 2,328 $635 353 483 634 876 1,280 $631 345 489 633 863 1,294 $637 346 494 639 861 1,333 $649 352 495 674 882 1,354 $652 344 502 661 917 1,321 $662 342 492 647 905 1,423 CRS-34 Table 2b. The Trend in Real Weekly Earnings: Full-Time, Year-Round Workers, 1995-2006 Percentile 1995 1996 1997 1998 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $880 394 581 803 1,137 1,971 $900 398 591 807 1,179 1,969 $915 409 602 838 1,204 2,047 $934 428 618 831 1,188 2,138 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $1,020 455 657 909 1,299 2,324 $1,036 465 664 933 1,304 2,338 $1,058 482 699 963 1,325 2,409 $1,072 475 713 950 1,394 2,376 Average Earnings 20th Percentile 40th Percentile 60th Percentile 80th Percentile 95th Percentile $671 354 503 651 909 1,415 $699 358 492 664 914 1,476 $708 361 506 674 939 1,469 $731 356 523 713 950 1,544 1999 2000 2001 2002 2003 All Full-Time, Year-Round Workers $930 $972 $986 $986 $983 419 428 438 431 422 625 630 635 647 632 849 856 876 862 855 1,233 1,238 1,270 1,293 1,265 2,224 2,252 2,190 2,263 2,319 Men $1,076 $1,137 $1,135 $1,136 $1,123 475 473 482 474 485 698 702 701 711 717 977 1,000 986 970 991 1,396 1,464 1,424 1,509 1,476 2,560 2,702 2,628 2,694 2,698 Women $723 $737 $777 $775 $787 367 374 394 388 384 524 540 548 539 548 698 702 723 733 738 968 983 989 1,026 1,054 1,609 1,576 1,643 1,681 1,708 Percent Change, 1979-2006 2004 2005 2006 $976 423 616 854 1,232 2,258 $979 417 616 854 1,271 2,324 $984 423 615 865 1,250 2,308 15.4% a 1.2% 3.0% 8.7% 14.2% 32.5% $1,116 472 718 985 1,437 2,669 $1,121 477 695 993 1,440 2,761 $1,114 468 673 962 1,442 2,731 9.6% a -9.6% -9.8% 0.6% 15.9% 37.2% $780 390 534 718 1,026 1,724 $778 392 537 726 1,033 1,728 $800 385 538 731 1,038 1,827 41.3% a 10.4% 20.2% 33.5% 44.9% 83.5% Source: Calculated by CRS from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). Note: Weekly earnings are in 2006 dollars. Estimates are for persons age 16 and over. a. Because of changes in topcoding that affected the change in average earnings between 1994 and 1995, the percent change in average real weekly earnings from 1979 to 2006 is the sum of changes from 1979 to 1994 and 1995 to 2006. CRS-35 Table 3a. Employment-Based Health Insurance Coverage: All Workers 1987-1999 (percent) Percentile 1987 1988 1989 1990 1991 1992 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 49.2 60.0 77.6 85.6 90.4 86.3 48.8 58.6 76.6 85.8 90.3 86.6 48.4 59.3 76.2 86.5 89.3 84.4 46.5 57.3 75.1 84.5 88.4 82.7 45.4 57.6 75.1 84.8 88.2 83.4 44.1 53.4 73.6 83.3 88.1 82.3 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 43.3 61.0 79.1 88.2 89.9 86.0 42.5 58.0 79.4 87.7 90.5 85.9 42.7 58.6 79.6 87.6 89.0 83.3 40.5 57.0 75.7 85.8 88.0 82.3 38.4 57.1 75.3 85.5 88.3 82.1 36.9 52.6 73.1 84.1 86.7 83.0 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 52.3 57.9 76.3 86.4 91.2 88.1 52.0 58.3 75.3 86.4 91.0 86.5 51.1 58.6 75.3 86.8 90.8 84.7 49.4 56.1 76.3 85.5 89.4 87.2 49.7 56.2 75.6 86.6 90.4 87.4 47.4 55.3 74.2 85.2 90.4 85.3 1993 All Workers 43.6 53.9 73.8 82.1 85.6 81.9 Men 38.9 53.8 73.1 83.0 84.7 81.3 Women 45.6 54.2 73.5 84.2 87.9 84.4 1994 1995 1996 1997 1998 1999 50.7 57.7 75.6 84.9 89.8 85.4 50.3 57.9 75.1 84.9 89.3 85.5 49.7 57.6 75.4 85.6 88.8 85.5 49.9 58.6 74.9 85.4 88.8 84.0 50.2 59.2 76.3 85.3 89.4 85.6 50.2 60.2 76.7 86.3 88.7 85.8 45.3 57.4 75.4 86.6 89.4 84.3 45.3 56.8 76.2 86.0 88.6 85.1 44.2 57.9 75.3 86.5 88.4 84.3 44.1 58.5 76.6 86.5 88.4 82.5 44.7 60.2 77.5 86.5 88.7 85.8 46.6 60.4 79.0 86.7 88.8 84.2 52.8 58.4 74.7 86.8 90.9 88.1 52.4 58.3 75.5 84.8 91.6 88.1 52.5 57.0 76.4 86.3 90.6 87.2 52.2 57.6 76.4 85.5 89.8 87.5 53.0 57.9 76.7 85.6 89.7 87.5 51.3 58.3 77.4 86.4 90.1 87.3 CRS-36 Table 3b. Employment-Based Health Insurance Coverage: All Workers, 2000-2006 (percent) Percentile 2000 2001 2002 2003 2004 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 51.3 62.1 78.8 86.7 89.2 86.7 49.6 61.5 78.0 86.6 89.0 85.4 48.6 60.2 76.4 85.4 88.4 83.8 47.3 58.1 75.8 84.7 88.1 84.3 48.2 58.5 75.4 84.8 88.1 85.9 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 46.8 63.0 79.3 87.6 88.7 86.9 44.9 62.0 79.3 85.9 88.9 84.8 44.1 58.9 77.7 85.4 88.1 82.5 43.5 58.1 75.8 85.3 86.9 84.0 43.4 57.0 74.5 85.7 87.1 84.9 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 53.2 60.9 79.6 86.9 90.4 87.8 52.1 60.7 78.0 87.5 91.3 86.4 50.3 60.1 77.8 86.8 88.8 87.1 49.2 57.5 75.9 86.2 89.5 88.1 50.8 58.0 76.5 87.6 89.9 88.5 2005 2006 All Workers 47.2 47.2 58.0 57.8 75.5 75.1 84.8 83.8 87.4 87.5 86.4 84.6 Men 42.7 41.6 55.9 56.4 75.6 75.2 84.3 83.5 87.2 86.5 85.6 82.9 Women 49.9 49.3 58.8 59.0 77.0 76.2 86.4 85.8 89.8 90.1 87.1 88.0 Change in Percent, 1987-1993 Change in Percent, 1994-2000 Change in Percent, 2000-2006 Change in Percent, 1987-2006 -5.6 -6.2 -3.8 -3.5 -4.8 -4.4 0.7 4.4 3.2 1.8 -0.6 1.2 -4.2 -4.3 -3.7 -3.0 -1.7 -2.1 -9.1a -6.1 -4.2 -4.6 -7.1 -5.3 -4.4 -7.2 -6.1 -5.2 -5.2 -4.8 1.5 5.6 3.8 1.0 -0.7 2.6 -5.2 -6.6 -4.1 -4.0 -2.2 -3.9 -8.1 -8.1 -6.3 -8.3 -8.1 -6.1 -6.7 -3.7 -2.9 -2.3 -3.2 -3.7 0.5 2.5 4.8 0.1 -0.5 -0.3 -3.9 -1.9 -3.4 -1.1 -0.2 0.2 -10.1 -3.1 -1.4 -3.3 -4.0 -3.7 Source: Calculated by CRS from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). Notes: Estimates are for persons age 16 and over. a. Because of changes in the CPS health insurance questions in 1994, the change shown from 1987 to 2006 is the sum of the change from 1987 to 1993 and from 1994 to 2006. CRS-37 Table 4a. Employment-Based Health Insurance Coverage: Full-Time, Year-Round Workers, 1987-1999 (percent) Percentile 1987 1988 1989 1990 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 59.2 82.2 87.6 91.4 92.4 88.8 58.9 80.1 87.0 90.9 93.1 89.5 58.3 80.7 86.7 91.1 91.1 86.4 55.8 78.5 85.4 89.6 90.9 86.7 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 55.4 80.7 88.4 92.2 91.8 88.2 53.5 78.7 87.7 91.7 92.9 89.7 53.9 79.9 87.1 91.8 90.1 86.4 50.2 76.1 85.1 90.0 90.0 86.7 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 60.3 83.9 89.2 91.8 94.0 91.6 60.8 82.8 88.6 92.0 94.5 89.0 60.7 81.1 88.6 91.9 93.2 89.4 58.8 82.6 88.7 90.7 92.0 90.5 1991 1992 1993 1994 1995 All Full-Time, Year-Round Workers 56.8 53.4 53.3 55.4 55.4 77.4 77.5 76.1 77.8 76.4 86.6 85.3 83.8 84.6 83.5 90.2 89.2 87.6 90.7 90.0 90.9 90.5 88.1 92.1 91.3 85.6 85.7 85.0 88.9 88.1 Men 51.4 48.4 48.2 50.1 52.1 76.2 74.8 73.4 74.4 73.4 84.9 84.8 82.7 84.8 83.3 90.1 89.0 87.5 90.5 89.7 90.0 88.6 86.8 91.6 90.4 86.5 86.6 84.2 88.0 88.3 Women 59.9 56.4 56.8 59.2 57.7 81.4 81.2 79.3 80.9 79.9 88.1 87.5 87.9 88.7 84.5 92.3 91.3 89.6 91.7 91.1 92.8 93.1 90.0 93.6 94.4 89.7 88.9 88.6 92.2 91.1 1996 1997 1998 1999 55.8 77.6 84.1 90.0 90.7 88.8 55.0 76.3 84.8 89.7 90.5 87.5 54.3 76.4 84.5 89.0 90.9 88.5 55.5 76.6 85.9 89.4 91.2 88.7 51.1 73.8 85.1 89.7 90.6 88.5 51.0 73.4 85.2 89.6 90.0 86.3 50.1 73.8 84.8 89.8 89.9 88.7 51.1 75.0 86.3 89.4 90.8 87.7 58.5 81.1 86.8 90.9 92.8 89.8 57.5 79.8 86.3 90.9 91.7 91.7 57.6 79.3 86.0 89.2 92.1 90.4 56.1 80.9 87.4 90.0 93.0 90.0 CRS-38 Table 4b. Employment-Based Health Insurance Coverage: Full-Time, Year-Round Workers, 2000-2006 (percent) Percentile 2000 2001 2002 2003 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 55.9 78.3 86.1 90.2 91.4 89.7 55.9 76.5 86.5 89.9 91.0 88.4 55.2 74.4 85.4 88.7 89.9 86.7 52.0 74.7 83.9 89.0 90.0 88.1 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 51.3 76.9 85.8 90.2 91.1 89.0 51.5 74.8 85.9 89.3 90.7 87.7 49.3 72.5 84.9 88.7 89.2 85.8 47.7 73.3 82.9 88.0 88.9 88.1 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 58.0 81.9 86.5 91.4 93.6 92.2 58.0 79.1 87.8 92.3 93.8 89.5 57.5 79.6 86.6 91.0 91.5 89.1 54.5 77.7 85.8 91.6 91.9 90.3 Change in Percent, 2004 2005 2006 1987-1993 All Full-Time, Year-Round Workers 52.5 50.9 50.6 -6.0 74.0 73.8 72.7 -6.1 83.7 84.1 83.4 -3.7 89.0 88.4 87.7 -3.8 90.1 89.9 89.6 -4.3 88.2 88.7 87.1 -3.8 Men 47.6 46.1 45.0 -7.2 70.8 70.6 69.9 -7.3 82.1 82.4 82.2 -5.7 88.0 87.5 86.8 -4.7 89.4 89.0 88.3 -5.0 87.5 88.1 86.1 -4.0 Women 55.7 55.7 55.5 -3.5 77.9 77.6 76.2 -4.6 88.5 86.6 86.6 -1.3 91.7 90.7 89.5 -2.1 91.6 92.9 92.8 -4.0 90.3 89.6 89.8 -3.0 Change in Percent, 1994-2000 Change in Percent, 2000-2006 Change in Percent, 1987-2006 0.5 0.6 1.5 -0.5 -0.7 0.8 -5.3 -5.6 -2.7 -2.5 -1.9 -2.6 -10.8 -11.1 -4.9 -6.8 -6.9 -5.6 1.2 2.5 1.0 -0.3 -0.5 1.0 -6.3 -7.0 -3.5 -3.4 -2.8 -2.9 -12.3 -11.8 -8.2 -8.5 -8.3 -5.9 -1.1 1.0 -2.2 -0.3 0.0 0.0 -2.5 -5.7 0.1 -1.9 -0.8 -2.4 -7.1 -9.3 -3.4 -4.3 -4.8 -5.4 Source: Calculated by CRS from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). Notes: Estimates are for persons age 16 and over. a. Because of changes in the CPS health insurance questions in 1994, the change shown from 1987 to 2006 is the sum of the change from 1987 to 1993 and from 1994 to 2006. CRS-39 Table 5a. Employer- or Union-Provided Pension Coverage: All Workers, 1979-1994 (percent) Percentile 1979 1980 1981 1982 1983 1984 1985 Lowest Quintile Second Quintile Third Quintile 7.4 24.4 46.2 7.0 24.2 46.6 6.2 23.2 45.7 5.9 23.1 44.3 5.8 21.4 45.0 5.6 21.2 43.4 5.9 21.1 43.3 Fourth Quintile 81-95% Top 5% 63.4 73.7 64.9 63.9 73.0 66.2 63.0 73.4 66.9 63.0 71.9 65.6 63.0 71.4 65.0 60.6 71.5 64.0 61.8 72.3 65.4 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 9.1 31.8 56.0 70.5 73.3 63.9 7.9 30.3 54.5 69.8 73.9 64.1 7.2 28.4 52.1 69.2 72.1 63.6 6.7 27.7 51.7 68.5 71.9 62.8 7.1 25.2 50.4 66.8 71.8 63.8 6.7 25.6 51.7 67.2 72.3 65.4 6.8 26.0 51.2 66.1 71.2 62.5 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 5.3 18.0 33.0 53.6 68.0 71.9 5.2 16.0 34.6 56.0 69.3 69.3 4.7 16.8 34.7 53.7 70.0 70.0 4.4 15.7 35.5 55.8 70.5 69.5 4.5 14.9 35.2 57.4 69.3 69.3 3.8 15.3 35.8 55.3 68.5 66.8 3.9 16.0 34.7 55.6 70.3 67.6 1986 1987 All Workers 6.1 5.5 21.2 20.6 43.5 41.4 1988 1989 1990 1991 1992 1993 1994 5.9 21.0 41.3 6.3 22.2 42.3 6.8 22.1 43.2 6.6 22.2 44.2 6.3 21.6 43.8 6.3 21.2 43.3 7.6 23.2 45.1 62.0 57.2 70.5 68.8 64.3 61.6 Men 6.8 6.6 26.0 24.7 51.2 46.7 66.1 63.2 71.2 69.7 62.5 60.3 Women 5.3 4.4 14.9 14.9 34.8 34.7 55.8 51.9 70.2 66.4 69.9 65.7 57.4 69.2 63.5 60.1 69.8 61.7 60.1 70.1 61.7 60.8 71.3 63.4 60.8 71.5 64.7 59.9 69.7 62.4 62.5 72.1 65.6 7.4 24.5 45.6 64.4 69.7 62.1 7.5 24.4 48.0 64.6 70.0 60.0 7.9 27.0 47.6 63.6 70.8 60.4 6.9 26.3 47.9 65.1 71.9 61.7 6.2 24.3 46.9 64.9 69.9 64.3 6.6 23.3 46.7 63.6 68.8 60.9 7.9 26.8 48.9 66.0 72.5 64.9 4.3 16.6 33.7 54.0 66.4 64.3 5.3 17.0 36.8 56.4 68.5 64.8 5.3 17.0 36.9 56.6 68.6 65.7 5.7 18.3 38.0 57.8 69.6 68.1 5.9 18.2 38.4 59.6 70.2 70.8 5.4 18.5 38.5 58.3 68.9 66.1 6.3 19.3 39.7 60.5 71.0 68.1 CRS-40 Table 5b. Employer- or Union-Provided Pension Coverage: All Workers, 1995-2006 (percent) Percentile 1995 1996 1997 1998 1999 2000 2001 2002 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 7.8 22.9 44.9 62.1 70.5 66.9 7.9 24.2 45.4 62.8 72.2 65.5 7.9 25.7 46.0 63.2 70.1 65.8 9.4 27.2 49.0 64.3 72.2 67.6 9.7 27.0 49.2 64.9 71.9 68.7 10.4 28.8 50.4 64.1 71.7 67.7 9.7 27.5 47.7 63.7 70.6 64.4 9.2 26.7 46.7 61.3 68.9 63.3 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 8.4 25.5 49.5 64.2 71.0 66.1 8.7 27.0 48.3 66.6 71.4 65.1 8.7 27.6 50.1 65.2 71.4 65.1 10.0 30.3 53.6 66.6 72.5 66.8 10.0 30.7 53.6 66.9 71.6 68.8 10.8 31.0 52.1 68.0 71.7 68.0 9.8 30.2 51.7 65.2 69.9 65.4 9.3 28.1 49.7 63.0 67.6 63.0 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 6.5 18.6 40.5 59.4 71.4 68.4 6.8 20.5 41.5 60.1 72.4 67.9 6.9 21.1 42.0 61.4 71 65.5 8.2 23.0 44.4 62.3 72.3 68.1 9.2 22.0 45.0 62.3 73.1 68.4 9.5 24.8 48.2 62.2 71.3 68.4 8.3 24.0 44.7 61.5 71.9 64.5 8.1 24.6 44.0 59.9 69.3 68.2 2003 2004 All Workers 9.1 9.1 26.0 26.9 47.3 46.5 61.3 61.4 70.2 68.5 64.6 65.9 Men 8.9 9.3 28.2 27.7 47.7 47.5 64.1 63.4 69.7 67.8 62.7 66.7 Women 8.6 8.4 23.2 23.5 44.6 45.2 60.9 61.5 71.2 69.3 68.1 68.7 Change in Percent, 1979-1987 Change in Percent, 2000-2006 Change in Percent, 1979-2006 2005 2006 9.1 25.6 45.9 60.4 66.3 64.2 9.7 25.6 43.8 57.1 64.6 60.9 -1.8 -3.9 -4.8 -6.2 -4.8 -3.4 4.9 8.3 9.0 7.0 2.9 6.2 -0.7 -3.2 -6.6 -7.0 -7.1 -6.8 2.4 1.1 -2.4 -6.2 -9.1 -4.0 9.3 27.3 46.7 60.6 67.0 61.7 9.5 26.2 44.7 58.2 64.1 59.4 -2.5 -7.2 -9.3 -7.3 -3.6 -3.6 4.2 6.3 5.4 4.9 2.1 7.7 -1.2 -4.8 -7.5 -9.8 -7.7 -8.6 0.4 -5.6 -11.3 -12.3 -9.2 -4.5 7.8 24.0 43.1 60.3 68.4 68.0 8.8 22.1 42.8 58.5 66.7 63.7 -0.9 -3.1 1.7 -1.7 -1.6 -6.2 5.2 9.9 13.5 10.2 5.0 2.8 -0.8 -2.7 -5.5 -3.6 -4.6 -4.7 3.5 4.1 9.7 4.9 -1.3 -8.2 Source: Calculated by CRS from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). Note: Estimates are for persons age 16 and over. Change in Percent, 1987-2000 CRS-41 Table 6a. Employer- or Union-Provided Pension Coverage: Full-Time, Year-Round Workers, 1979-1994 (percent) Percentile 1979 1980 1981 1982 1983 1984 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 29.5 53.1 64.0 74.7 76.2 65.9 29.1 53.4 65.6 73.8 75.4 67.6 28.1 53.2 65.4 73.1 76.1 68.6 28.3 51.6 64.7 72.4 75.4 67.5 26.3 51.3 64.1 72.9 73.8 65.4 25.5 49.3 62.6 70.8 75.4 65.8 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 28.7 56.2 69.5 75.7 74.8 63.3 29.6 54.5 69.2 75.6 75.3 66.3 28.3 55.1 68.1 75.2 76.1 64.8 27.3 52.8 67.1 73.9 74.6 66.5 25.8 52.3 67.5 73.1 73.1 64.2 24.0 50.9 64.1 73.8 72.9 65.7 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 27.3 45.0 60.7 70.9 77.3 78.6 25.9 48.0 61.5 72.3 77.1 72.2 25.3 47.7 61.1 72.4 77.2 75.4 24.9 49.3 62.2 72.0 77.7 73.6 23.7 48.1 62.1 71.5 76.6 72.2 23.8 46.8 61.1 69.4 75.9 75.3 1985 1986 1987 1988 All Full-Time, Year-Round Workers 25.3 24.0 22.7 23.2 48.3 48.6 45.4 44.5 63.8 62.3 58.1 57.4 71.3 70.6 68.2 68.7 75.2 74.0 71.9 72.8 69.4 66.3 64.4 65.1 Men 23.1 22.4 22.6 22.3 50.5 49.7 45.6 43.9 65.2 65.5 60.6 59.2 73.6 71.5 69.7 70.7 75.2 72.8 71.8 73.2 68.0 64.3 61.2 65.0 Women 24.1 22.4 20.0 21.9 45.6 45.2 43.6 41.9 60.3 60.2 56.3 57.5 71.5 70.4 65.5 66.8 77.2 76.2 74.9 74.6 70.6 74.5 71.1 66.4 1989 1990 1991 1992 1993 1994 24.0 46.0 59.2 69.3 72.6 62.1 23.6 45.7 59.8 69.2 74.2 65.9 23.3 46.4 62.4 70.7 75.2 66.0 23.6 46.9 62.2 70.4 75.3 69.9 22.2 45.0 60.4 69.6 73.3 65.7 23.7 48.4 61.2 71.7 75.8 69.8 21.7 46.1 60.1 71.7 70.5 63.6 23.0 45.5 60.2 71.9 73.0 64.1 22.5 47.8 62.2 73.1 73.7 66.8 21.5 46.0 63.1 73.1 71.7 69.3 19.6 43.7 61.1 70.9 71.6 64.4 22.4 46.1 62.8 72.0 75.8 68.7 22.8 45.0 59.1 68.6 74.0 70.5 22.3 44.0 59.2 68.8 75.6 71.1 22.6 44.8 60.0 71.0 75.8 72.0 22.7 48.2 61.6 70.2 77.7 77.5 22.5 45.9 60.9 70.2 74.8 73.6 22.4 48.8 62.3 72.9 76.3 74.9 CRS-42 Table 6b. Employer- or Union-Provided Pension Coverage: Full-Time, Year-Round Workers, 1995-2006 (percent) Percentile 1995 1996 1997 1998 1999 2000 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 23.3 45.8 60.2 69.9 74.3 70.9 24.4 47.5 60.7 71.6 74.9 70.8 24.9 46.8 61.7 70.4 73.6 70.9 25.8 48.3 63.7 70.9 75.2 71.2 25.8 48.1 63.6 71.4 75.7 74.0 25.3 48.7 61.3 71.6 74.8 71.9 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 21.9 45.2 60.7 69.6 74.3 69.5 22.5 45.4 61.5 72.6 74.6 68.9 23.2 45.4 62.7 69.3 74.5 70.9 23.9 47.9 62.5 72.6 74.2 70.8 24.2 48.3 63.9 72.1 75.5 72.8 22.3 47.8 61.8 72.4 75.9 69.8 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 22.7 46.5 57.9 71.6 78.8 71.9 24.4 48.3 61.0 72.3 77.5 72.7 24.5 47.2 62.2 71.9 75.4 71.9 26.5 48.6 63.7 71.0 78.4 73.2 24.2 48.4 63.9 70.9 79.5 73.0 25.1 50.9 62.0 70.3 76.6 75.6 2001 2002 2003 2004 2005 2006 All Full-Time, Year-Round Workers 24.7 24.0 22.4 22.7 20.6 21.4 46.3 44.3 46.3 44.6 43.5 40.2 60.4 59.1 58.1 58.2 58.0 55.1 70.1 67.9 68.9 68.3 66.0 63.2 73.4 71.7 73.7 72.6 70.6 67.2 68.8 69.1 69.2 70.0 67.4 65.5 Men 22.5 20.8 19.6 19.4 18.8 18.7 44.6 43.1 45.0 41.7 42.2 38.3 61.5 59.9 57.3 58.5 56.0 53.4 70.7 68.7 69.2 67.9 65.2 62.1 72.5 70.1 72.6 70.9 69.5 66.9 68.7 65.8 67.1 69.8 65.0 62.8 Women 24.6 25.2 23.9 24.6 22.6 23.3 46.5 45.5 45.9 47.3 44.5 42.4 61.1 59.9 61.5 60.9 59.8 57.0 70.0 67.8 70.1 70.3 68.2 65.6 76.7 74.0 75.4 72.8 73.3 70.8 70.9 76.2 74.0 74.8 73.5 68.2 Change in Change in Change in Change in Percent, Percent, Percent, Percent, 1979-1987 1987-2000 2000-2006 1979-2006 Source: Calculated by CRS from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). Note: Estimates are for persons age 16 and over. -6.8 -7.7 -6.0 -6.5 -4.2 -1.5 2.6 3.3 3.3 3.4 2.9 7.5 -3.9 -8.5 -6.2 -8.4 -7.7 -6.4 -8.1 -12.9 -8.9 -11.5 -9.0 -0.4 -6.1 -10.6 -8.9 -6.0 -3.0 -2.1 -0.4 2.2 1.2 2.8 4.0 8.6 -3.6 -9.5 -8.4 -10.3 -8.9 -7.1 -10.0 -17.9 -16.1 -13.6 -7.9 -0.5 -7.3 -1.4 -4.4 -5.3 -2.4 -7.5 5.1 7.3 5.7 4.8 1.7 4.5 -1.8 -8.4 -5.0 -4.7 -5.8 -7.3 -4.0 -2.5 -3.8 -5.3 -6.5 -10.3 CRS-43 Table 7. Gini Coefficients for All Workers and for Full-Time, Year-Round Workers, 1979-2006 Year 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 Total Men A. All Workers 0.40772 0.36699 0.40458 0.36412 0.41460 0.38118 0.42016 0.39090 0.42395 0.39558 0.42782 0.39854 0.42871 0.40032 0.43131 0.40484 0.42781 0.40176 0.42833 0.40340 0.42862 0.40583 0.42366 0.40144 0.42495 0.40517 0.42216 0.40455 0.43125 0.41309 0.43524 0.41660 0.47431 0.46835 0.46406 0.45790 0.46617 0.46026 0.46628 0.45756 0.45288 0.44374 0.46679 0.46885 0.47068 0.46564 0.47152 0.47456 0.46831 0.46403 0.46678 0.46611 0.47500 0.47887 0.46989 0.46681 B. Full-Time, Year-Round Workers 0.31643 0.29432 0.31033 0.28875 0.32316 0.30657 0.32826 0.31427 0.32863 0.31627 0.33670 0.32520 0.33538 0.32558 0.33976 0.32949 0.33660 0.32673 0.33782 0.32844 0.33997 0.33139 0.33706 0.33259 0.33624 0.32979 0.33613 0.33215 0.34172 0.33803 0.34654 0.34220 0.38731 0.39594 0.39246 0.40016 0.39093 0.39941 0.38999 0.39703 0.38020 0.38363 0.40197 0.41458 Women 0.37528 0.37835 0.37901 0.38632 0.39450 0.40189 0.40559 0.40460 0.40683 0.40792 0.40934 0.40931 0.40967 0.40809 0.41992 0.42328 0.44358 0.43515 0.43605 0.44347 0.42834 0.42539 0.44669 0.43294 0.44594 0.43695 0.43933 0.44776 0.25941 0.25965 0.26195 0.27251 0.27586 0.28272 0.28473 0.29375 0.29380 0.29908 0.30308 0.30005 0.30412 0.30317 0.31204 0.31959 0.33095 0.34233 0.33888 0.34263 0.33654 0.33904 CRS-44 Year 2001 2002 2003 2004 2005 2006 Total 0.40573 0.40194 0.39841 0.40204 0.40645 0.40868 Men 0.41449 0.41410 0.40673 0.41409 0.42065 0.41705 Women 0.35912 0.34917 0.35634 0.35386 0.35455 0.37138 Source: Calculated by CRS from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). Note: Estimates are for persons age 16 and over. The Gini coefficient is a measure of earnings equality that ranges from 0 to 1. A larger coefficient indicates a greater degree of inequality. CRS-45 Table 8a. Share of Total Weekly Earnings: All Workers, 1979-1994 (percent) Percentile 1979 1980 1981 1982 1983 1984 1985 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 4.1 10.3 16.3 24.4 27.8 17 4.2 10.4 16.3 24.6 27.9 16.6 4 10.2 16.1 24.3 27.8 17.6 3.9 10 16 24.3 28 17.8 3.8 9.8 16 24.3 28.1 18 3.8 9.7 15.8 24.3 28.1 18.3 3.8 9.7 15.8 24.1 28 18.6 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 4.8 11.7 17.7 24.5 26.1 15.3 4.8 11.7 17.8 24.8 26.3 14.7 4.5 11.2 17.4 24.5 26.2 16.2 4.3 10.9 17.2 24.4 26.7 16.5 4.2 10.7 17.1 24.6 26.9 16.6 4.1 10.6 17 24.5 26.9 16.9 4.2 10.6 16.8 24.4 26.9 17.2 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 4.6 11.5 17.5 24.4 26.4 15.6 4.5 11.4 17.4 24.4 26.6 15.8 4.5 11.2 17.4 24.5 26.8 15.5 4.3 10.9 17.2 24.7 27.2 15.6 4.2 10.7 17 24.6 27.3 16.1 4.1 10.5 16.8 24.5 27.3 16.9 4.1 10.4 16.7 24.4 27.3 17.1 1986 1987 All Workers 3.8 3.8 9.6 9.7 15.7 15.9 24.1 24.1 28 28.1 18.7 18.4 Men 4.2 4.2 10.4 10.5 16.7 16.8 24.2 24.3 26.7 27.1 17.7 17.1 Women 4.1 4.1 10.3 10.3 16.6 16.6 24.7 24.4 27.7 27.6 16.7 17 1988 1989 1990 1991 1992 1993 1994 3.8 9.7 15.9 24.2 28 18.5 3.8 9.7 15.8 24 28 18.7 4 9.8 15.9 23.9 28 18.4 3.9 9.7 15.9 24.1 28 18.3 3.9 9.8 16 24.1 28.2 18 3.8 9.6 15.7 23.9 28.4 18.6 3.9 9.5 15.4 23.6 28.3 19.2 4.2 10.5 16.7 24.2 26.9 17.5 4.2 10.5 16.5 24.1 27.1 17.6 4.4 10.5 16.5 24 27.3 17.3 4.3 10.4 16.5 24.1 27.4 17.3 4.3 10.3 16.5 24.2 27.8 16.9 4.1 10.2 16.2 24 28.1 17.4 4.3 10.1 15.9 23.7 28.1 18 4 10.2 16.6 24.6 27.8 16.8 4.1 10.2 16.4 24.4 27.8 17.1 4.1 10.2 16.4 24.4 27.6 17.3 4.1 10.2 16.3 24.4 27.8 17.2 4.1 10.2 16.4 24.6 27.8 16.9 3.9 10 16.1 24.2 27.9 17.9 4.1 9.9 15.8 23.9 27.8 18.5 CRS-46 Table 8b. Share of Total Weekly Earnings: All Workers, 1995-2006 (percent) Percentile 1995 1996 1997 1998 1999 2000 2001 2002 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 3.6 8.9 14.4 21.9 26.2 25 3.8 9.1 14.6 22.1 26.6 23.8 3.7 9.1 14.6 21.9 26.4 24.3 3.8 9.1 14.6 21.8 26.3 24.4 3.9 9.3 14.9 22.4 27.3 22.1 3.9 9.2 14.4 21.6 26.2 24.7 3.8 9.1 14.3 21.4 26.3 25.1 3.8 9.1 14.3 21.4 26.3 25.1 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 3.8 9.2 14.6 21.6 25.3 25.5 3.9 9.4 14.8 21.9 25.7 24.3 4 9.4 14.7 21.5 25.7 24.7 4 9.5 14.8 21.6 25.9 24.3 4.1 9.7 15.1 22.3 26.9 22 4 9.2 14.2 21.1 25.4 26 4 9.3 14.3 21.1 25.8 25.4 4 9.1 14.1 20.9 25.8 26.2 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 3.9 9.6 15.3 23 26.9 21.4 4.1 9.7 15.5 23.1 27 20.7 4 9.7 15.5 23.1 26.9 20.8 4.1 9.6 15.2 22.6 26.4 22.1 4.2 9.9 15.6 23.2 27.3 19.8 4.2 10 15.8 23.1 27 19.9 4.1 9.6 15.1 22.3 26.2 22.7 4.1 9.9 15.5 22.9 26.7 20.9 2003 2004 2005 All Workers 3.8 3.8 3.8 9.1 9.2 9 14.4 14.4 14.1 21.6 21.7 21.3 26.7 26.7 26.3 24.4 24.2 25.5 Men 4 4 3.9 9.3 9.3 9 14.4 14.3 13.9 21.4 21.3 20.8 26.3 26.2 25.8 24.6 25 26.6 Women 4 4 4.1 9.6 9.8 9.7 15.2 15.5 15.3 22.4 22.8 22.6 26.5 27.1 26.9 22.2 20.8 21.4 Change in Change in Change in Change in Change in Percent, Percent, Percent, Percent, Percent, 2006 1980-1986 1986-1992 1992-1994 1995-1999 1999-2006 3.9 9.1 14.2 21.5 26.4 24.9 -0.4 -0.8 -0.6 -0.5 0.2 2.1 0.2 0.2 0.2 0.0 0.1 -0.8 0.0 -0.3 -0.5 -0.6 0.1 1.3 0.3 0.4 0.5 0.5 1.1 -2.8 0.0 -0.2 -0.7 -1.0 -0.9 2.8 4.1 9.2 14.2 21.1 26.1 25.3 -0.6 -1.2 -1.1 -0.7 0.5 3.1 0.1 -0.1 -0.2 0.0 1.0 -0.8 0.0 -0.3 -0.6 -0.5 0.3 1.1 0.2 0.5 0.6 0.7 1.6 -3.5 0.0 -0.4 -0.9 -1.2 -0.8 3.3 4.1 9.5 15 22.4 26.6 22.5 -0.4 -1.1 -0.8 0.3 1.1 0.9 0.0 -0.1 -0.2 0.0 0.2 0.2 0.0 -0.4 -0.6 -0.7 0.0 1.7 0.3 0.3 0.3 0.2 0.4 -1.5 -0.1 -0.4 -0.6 -0.9 -0.7 2.6 Source: Calculated by CRS from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). Note: Estimates are for persons age 16 and over. CRS-47 Table 9a. Share of Total Weekly Earnings: Full-Time, Year-Round Workers, 1979-1994 (percent) Percentile 1979 1980 1981 1982 1983 1984 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 7.5 12.7 17.3 23.5 25 14 7.6 12.7 17.4 23.7 25 13.5 7.4 12.4 17.2 23.4 24.9 14.8 7.2 12.4 17.1 23.2 25.2 14.9 7.1 12.4 17.1 23.4 25.3 14.7 6.9 12.2 17 23.3 25.2 15.4 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 7.7 13.5 18.1 23.4 24.4 12.9 7.8 13.6 18.3 23.5 24.4 12.3 7.5 13.1 17.9 23.3 24.2 14 7.2 13 17.7 23.2 24.8 14.1 7 12.9 17.8 23.4 24.9 13.9 6.8 12.7 17.6 23.3 24.7 14.8 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 9.2 14.4 18.2 22.9 23 12.2 9.1 14.5 18.2 23 23.1 12.1 9 14.3 18.2 23.3 23.3 11.9 8.7 14.1 18.1 23.2 23.4 12.6 8.5 14 18 23.3 23.6 12.6 8.3 13.7 18 23.4 23.7 12.9 1985 1986 1987 1988 All Full-Time, Year-Round Workers 7 6.8 6.9 6.9 12.2 12.1 12.2 12.1 17 17 17 17 23.3 23.3 23.3 23.3 25.2 25.3 25.4 25.3 15.3 15.5 15.2 15.4 Men 6.9 6.8 6.9 6.9 12.6 12.5 12.5 12.5 17.5 17.5 17.5 17.5 23.4 23.3 23.4 23.3 24.8 25 25 25.2 14.8 14.9 14.6 14.7 Women 8.3 8 8 7.8 13.6 13.4 13.5 13.3 18 17.9 17.8 17.8 23.5 23.5 23.4 23.4 23.9 24 24.1 24.3 12.8 13.3 13.3 13.5 1989 1990 1991 1992 1993 1994 6.8 12.2 16.8 23.2 25.5 15.5 6.9 12.2 16.9 23.2 25.6 15.2 6.9 12.2 17 23.3 25.6 15 6.9 12.1 17.1 23.3 25.7 14.9 6.7 12 16.9 23.3 26.1 15 6.7 11.8 16.7 23.3 26.4 15.2 6.9 12.4 17.2 23.3 25.5 14.7 6.8 12.3 17.2 23.4 25.7 14.6 6.8 12.4 17.3 23.5 25.7 14.2 6.7 12.3 17.3 23.5 26 14.2 6.7 12.1 17 23.6 26.4 14.2 6.6 12 16.9 23.5 26.7 14.3 7.7 13.2 17.6 23.4 24.4 13.7 7.8 13.2 17.7 23.5 24.3 13.5 7.8 13.1 17.6 23.3 24.3 13.8 7.7 13.1 17.8 23.4 24.5 13.5 7.4 13 17.6 23.4 24.8 13.9 7.3 12.7 17.3 23.3 24.9 14.4 CRS-48 Table 9b. Share of Total Weekly Earnings: Full-Time, Year-Round Workers, 1995-2006 (percent) Percentile 1995 1996 1997 1998 1999 2000 2001 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 6.3 11.1 15.6 21.8 24.6 20.7 6.3 11.1 15.3 21.4 24.4 21.5 6.3 11.1 15.4 21.4 24.4 21.4 6.3 11.1 15.5 21.5 24.6 21.1 6.3 11.2 15.7 22.0 25.5 19.3 6.1 10.8 15.1 21.2 24.6 22.2 6.1 10.7 14.9 20.9 24.6 22.7 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 6.1 11.0 15.5 21.5 24.3 21.7 6.0 10.9 15.3 21.2 24.2 22.3 6.1 11.0 15.3 21.1 24.3 22.2 6.1 11.0 15.4 21.3 24.7 21.6 6.2 11.2 15.7 22.0 25.4 19.6 5.9 10.5 14.8 21.0 24.4 23.5 5.9 10.5 14.7 20.8 24.5 23.5 Lowest Quintile Second Quintile Third Quintile Fourth Quintile 81-95% Top 5% 7.2 12.5 17.0 22.8 24.6 15.9 7.3 12.3 16.5 22.2 24.2 17.5 7.3 12.3 16.7 22.4 24.3 17.1 7.2 12.2 16.6 22.2 24.3 17.4 7.1 12.3 16.9 22.7 24.8 16.2 7.1 12.4 16.7 22.5 24.6 16.7 7.0 11.9 16.1 21.8 24.2 19.0 Change in Change in Change in Change in Change in Percent, Percent, Percent, Percent, Percent, 2002 2003 2004 2005 2006 1980-1986 1986-1992 1992-1994 1995-1999 1999-2006 All Full-Time, Year-Round Workers 6.2 6.2 6.1 6.1 6.0 -0.8 0.1 -0.2 0.1 -0.3 10.8 10.9 10.8 10.6 10.6 -0.6 0.1 -0.3 0.1 -0.7 15.0 15.1 15.0 14.9 14.9 -0.5 0.1 -0.4 0.4 -0.8 21.1 21.3 21.2 21.1 21.1 -0.4 0.0 -0.1 0.6 -0.9 25.0 25.2 25.0 25.1 25.1 0.3 0.4 0.6 1.1 -0.4 22.0 21.4 21.8 22.1 22.4 2.0 -0.7 0.3 -2.2 3.1 Men 5.9 6.0 5.8 5.8 5.8 -1.0 0.0 -0.2 0.1 -0.3 10.5 10.6 10.5 10.3 10.3 -1.0 -0.2 -0.4 0.2 -0.8 14.8 15.0 14.9 14.7 14.8 -0.8 -0.2 -0.4 0.4 -0.9 21.0 21.3 21.0 20.9 20.9 -0.2 0.2 0.0 0.8 -1.1 25.0 25.3 25.1 25.0 25.2 0.5 1.0 0.8 1.2 -0.2 22.9 21.8 22.7 23.4 22.9 2.6 -0.7 0.1 -2.7 3.3 Women 7.1 6.9 6.9 7.0 6.8 -1.1 -0.3 -0.3 -0.1 -0.4 12.1 12.0 12.0 11.8 11.5 -1.1 -0.3 -0.4 0.0 -0.8 16.3 16.2 16.3 16.3 15.8 -0.3 -0.1 -0.5 0.4 -1.1 22.1 22.0 22.1 22.2 21.7 0.4 0.0 -0.2 0.5 -0.9 24.4 24.4 24.7 24.9 24.5 0.9 0.6 0.4 0.7 -0.3 17.9 18.4 17.9 17.8 19.7 1.2 0.2 1.0 -1.4 3.5 Source: Calculated by CRS from the Annual Social and Economic (ASEC) Supplement to the Current Population Survey (CPS). Note: Estimates are for persons age 16 and over.