Class of Worker


I have been working on a project using the class of worker variable and I have a couple of questions.

First, using CPS, it appears we are able to identify self-employed individuals who paid an employee using the PAIDEMP1 variable. However, in 2020 and 2021 incorporated self-employed people are not included in this, is there a systematic reason for that? Can we say something about if this self-employed individual employed other people or not based on incorporated/unincorporated status? In any case, what is the reason for incorporated self-employed not getting asked if they paid an employee in 2020 and 2021?

Second, the IPUMS USA discusses this subject a little bit under the definition of the class of worker variable and says “The 1970-2000 censuses, the ACS and the PRCS distinguish between employers and other self-employed persons whose businesses/farms were incorporated and those whose businesses/farms were not.” What should I make out of this? IPUMS USA, as far as I can see, doesn’t inform about the number of employees or if the respondent said they employ people, is this distinction somehow made by incorporated/unincorporated status in ACS and PRCS? If not, is there a way to distinguish self-employed people with and without employees using ACS and PRCS?

Thank you!

For your first question about the IPUMS CPS variable PAIDEMP1, it’s not exactly clear why the universe differs from January 2020 through January 2021. Since incorporated self-employed respondents are not in the universe for PAIDEMP1 during this period, it’s impossible to tell whether these respondents employed other people or not; they were simply not asked this question. This universe change is not documented in CPS codebooks, so it does not seem like there is a systematic reason for it. However, I recommend reaching out to census if you would like to learn more.

Regarding the IPUMS USA variable CLASSWKR, this note you quote explains that these samples distinguish between two groups of self-employed persons (which includes employers) - those whose businesses/farms were incorporated and those whose businesses/farms were not. This variable does not reveal whether the self-employed person employed others or not. To my knowledge, there is no variable in the ACS/PRCS that distinguishes those with and without employees.