Average income per occupation

CPS
1

Hello,
I was wondering if there was a proper way to connect income with occupation. Basically I am interested in occupation mobility networks, capturing occupational transitions, and would like to incorporate the yearly weighed average income of an occupation. However, the income reported in INCWAGE accounts for the entire previous calendar year. Meaning, if someone switched occupation within this time period (OCC and OCCLY are different) INCWAGE represents what that person earned in total, and it cannot be properly assigned to one occupation. Another variable I looked into is INCLONGJ which holds the earnings of a persons longest job in the previous year. But again I do not know which occupation to assign this to (which occupation was the longest one?) as well as the timespan how long a person worked in this longest occupation in order to properly calculate a yearly income average for this occupation.

Am I missing something here? Is there an appropriate way on how to conduct this?

Thank you in advance!
Julia

2

You are correct that most income variables in the CPS refer to the previous calendar year, making it difficult to calculate the average income for a given occupation. The variable EARNWEEK, part of the Outgoing Rotation Group (earner study), reports earnings from the respondent’s current job. If the respondent has more than one job at the time of the survey, EARNWEEK reports earnings from their main job. You could use EARNWEEK in combination with OCC or another occupation variable to determine the average wage by occupation. There may be other methods you could use to calculate income by occupation, but this is the one that I believe requires the least restrictive assumptions. You can use the panel aspect of the CPS to capture occupation transitions; see this page on linking the CPS.

3

Thank you for your help. Sounds like a good approach for my use case, definitely gonna take a closer look into it.