Monthly Labor Review • August 2009 25

Income Imputation

The impact of income imputation

in the Consumer Expenditure Survey

Bill Passero

Bill Passero is a senior economist 

in the Branch of Information and 

Analysis, Office of Prices and Living Conditions, Bureau of Labor 

Statistics. E-mail: passero.bill@

bls.gov

With the release of 2004 data from the Consumer Expenditure

Survey, the Bureau of Labor Statistics began implementing

imputation for missing responses to questions about income;

imputation has brought CE estimates closer to CPS estimates,

but significant disparities remain between the estimates

for many of the smaller components

From 1980, the year the Consumer 

Expenditure Survey (CE) became 

a continuous survey, until 2004, 

no procedures were employed to produce 

estimates for sources of income that respondents acknowledged receiving, but for 

which they did not provide values. However, 

the release of 2004 data marked the introduction of imputation for missing income 

responses. With a number of years of imputed income data now available, it is possible to evaluate how well BLS imputation 

routines are working. The purpose of this 

article is to assess the impact and efficacy of 

imputation by comparing pre- and postimputation estimates of CE-reported income 

with estimates from the Current Population 

Survey (CPS), a large-scale household survey that has employed imputation for many 

years in the course of producing its income 

estimates.

In the next section, after a brief discussion of the background and history of 

income imputation in the CE, the methodology for comparing CE and CPS income 

estimates is presented. Then the timing of 

income data collection in the two surveys 

is examined. Timing is important because 

it affects the construction of matching periods 

for comparison. The discussion then proceeds to 

detail the structure and content of the income 

questions asked in each survey’s respective collection instrument.

Following the latter discussion, the next section of the article is dedicated to a comparative 

analysis of aggregate income estimates from the 

CE and CPS. The common income categories 

that can be created from the two surveys are 

detailed, and three alternative estimates of CE 

income are described. These estimates are then 

measured against CPS estimates. The analytical 

portion of this section is devoted to examining 

both levels and ratios of CE and CPS aggregates, 

for total income and by income category. The 

final section of the article briefly summarizes 

the results of the analysis and notes the direction that future refinements in the collection 

and imputation of income in the CE are likely 

to take.

Background

The CE produces comprehensive expenditure 

data reflecting the buying habits of U.S. families. Because it is vital that the soundness and 

consistency of these data be maintained, the 
Income Imputation

26 Monthly Labor Review • August 2009

BLS conducts regular, thorough comparisons of CE data 

with expenditure data from other sources, such as the 

Personal Consumption Expenditures (PCE) component 

of the National Income and Product Accounts produced 

by the Bureau of Economic Analysis.1

 But a unique feature of the CE which makes it particularly useful is that, 

as a household survey, it also collects demographic and 

socioeconomic characteristics of participants that can be 

associated with the expenditures they make.

Among these characteristics is family income, one of the 

most important demographic determinants of consumer 

spending. Household surveys intent on collecting data on 

family income, either as their primary interest or as supplementary to their primary interest, often encounter the issue 

of nonresponse because of the sensitive nature of income 

data. Respondents frequently feel uncomfortable answering questions about their income or may believe that such 

questions are an invasion of their personal privacy.

Survey managers have resorted to various methods developed by the statistics community for imputing values 

to substitute for missing responses. These methods make 

certain assumptions about the distribution of missing 

values and the relationship of nonresponse to socioeconomic characteristics of the sample population. To the extent that the procedures violate the mechanisms leading 

to nonresponse, the resulting imputed values will lead to 

biased and inconsistent results when used for analytical 

purposes.

CE managers have become particularly sensitive to 

these concerns because sampled consumer units2

 report 

expenditure data that are expected a priori to be highly 

correlated with income. Consequently, from 1972 to 2003 

the CE did not impute for missing income, and CE data 

releases instead identified sample households as either 

“complete” or “incomplete” income respondents.3

Given the unique requirements that any income imputation procedure would have to satisfy, CE and Census 

Bureau staff began a systematic search for an appropriate method. Geoffrey Paulin and David Ferraro laid out 

theoretical and practical issues that would have to be resolved before a method could be selected.4

 Two general 

methods for performing imputations merited evaluation. 

Hot-decking was the technique employed by large-scale 

surveys such as the CPS. This technique imputes missing income values in the sample with values reported by 

persons in families with a similar set of demographic and 

socioeconomic characteristics, predetermined to be relevant to the level of income. Paulin and Ferraro eliminated 

hot-decking as a method for the CE because of the small 

sample size of that survey.

The second class of methods examined was modelbased imputation, which draws on the work of Roderick 

Little and Donald Rubin.5

 Each of these methods consists of two parts. The first part involves the creation of a 

statistical model to predict income values, while the second part is concerned with producing error terms to add 

to the predicted values, thereby preserving the variance of 

the distribution.

To employ a model-based imputation method appropriately, the response mechanism by which the missing 

income responses came into being had to be determined 

first. Little and Rubin laid out three mechanisms. In the 

first, the missing income responses occur completely at 

random and are not correlated with any characteristics of 

the respondents. In the second, the missing responses are 

correlated with characteristics of the respondents, excluding income. In the final method, the missing responses 

are correlated with both characteristics of the respondents 

and the level of income.

In addition, two operational modeling questions had to 

be answered: first, would income imputation be done at 

the consumer unit level or at the individual member level 

within each consumer unit? and second, would imputation be done for total income or for each of the component items of total income?

After researching these questions, Paulin and Ferraro 

concluded that the second response mechanism, wherein 

nonresponse is correlated with respondent characteristics 

only, would be tested first. This testing would then be 

aimed toward (1) imputation at the consumer unit level, 

which would avoid complications introduced by interactions involving work decisions between members, and (2) 

individual components of income, which would provide 

more information for researchers and allow for differences 

in model specification and parameter estimates between 

items.

Finally, Paulin and Ferraro addressed the question of 

whether expenditures were useful in predicting income 

and, therefore, should be included in modeling. Testing 

also would confirm retrospectively whether past reluctance to impute with methods that did not account for 

expenditures was justified. Paulin and Ferraro found that 

both total expenditures and expenditures for selected subaggregations of items demonstrated predictive power.

While research continued into the appropriate method 

for imputing income in the CE, changes were made in the 

collection instruments in 2001 to improve the reporting 

of income. Bracketing questions were added to the survey 

to follow the initial questions. The bracketing questions 

asked for the amount received for each source of income a 
Monthly Labor Review • August 2009 27

respondent indicated that the consumer unit had received. 

Thus, if a respondent initially refused to report his or her 

income or did not know the amount received, the bracketing questions probed to determine whether the respondent would select a range that best reflected the amount 

received. The responses to the bracketing questions added 

a layer of complexity to the task of choosing an imputation method.

Once the research was completed, it was determined 

that the method chosen for the CE would be a regression-based procedure that would preserve both means and 

variances for each source of income. The process would 

produce five imputed values for each missing observation. 

The first step would be to run a regression to obtain coefficients to use in creating imputed values. Random noise 

would then be added to each coefficient, and the resulting 

“shocked” coefficient used to estimate an imputed value. 

Additional noise would be added to the estimated values 

to ensure that consumer units with similar demographic 

characteristics would not receive similar imputed incomes. After the five imputed values were created for each 

missing value, an estimate representing the mean of those 

five values would be calculated. Reported specific values 

would be retained as is. If a respondent reported a certain 

bracket within which his or her income fell, the imputed 

values would have to fall within the range defined for that 

bracket.

In a small number of instances, a consumer unit might 

report not receiving income from any source. In such an 

extremely unlikely situation, the income imputation procedure would be run with an additional step: a logistic regression based on the characteristics of the consumer unit, 

such as whether he or she was retired or was a student, 

would be run first to impute a receipt status (yes or no) for 

each source of income. For those sources of income that 

a consumer unit was imputed to have received, the model 

would be run to produce imputed income values.

Data collection

The introduction of imputed income in data released from 

the 2004 CE permits the same kind of comparisons between the CE and other sources that have been made in 

the past for expenditure items. In fact, by comparing the 

CE income estimates with those from another established 

source of income data over a period covering pre- and 

postimputation years, one can measure both the impact 

of imputation on the relationship of aggregate CE income 

to the independent source and the efficacy and quality of 

the imputation method in producing those estimates. For 

this study, CE income data are compared with similar data 

from the CPS for the 2002–06 period. 

Comparisons of mean or aggregate pretax income between the CE and the CPS have been a staple feature of 

BLS publications for almost 20 years.6 Almost all these 

published comparisons were based on CE data before 

imputation and CPS data that included imputed values.

Income estimates for the CE are from its Interview Survey component, while the Annual Social and Economic 

Supplement (ASEC) is the source of CPS income data for 

comparison in this study.

The difference in timing of the collection of income 

data between the CE and the CPS poses challenges in constructing matching periods for comparison purposes. The 

Interview Survey is designed to collect one year’s worth of 

expenditure data from sample units. This is done through 

five interviews, the first interview for bounding purposes 

only and the remaining four interviews conducted at 3-

month intervals, thereby collecting expenditure data for 

12 months. The Interview Survey uses a rotating design 

whereby sample units are introduced every month (replacing other units that have completed their participation in the survey.) Income data are collected during the 

second and fifth interviews, covering the 12 months prior 

to the month of the current interview. Thus, a consumer 

unit undergoing the second interview in June 2007 would 

report wage income received from June 2006 through 

May 2007.

The ASEC is conducted annually in March, although 

a limited number of eligible households are interviewed 

in February and April. The survey collects data on the 

previous calendar year’s income from all sources. Thus, 

households completing the ASEC in March 2007 report 

income for the 2006 calendar year. Conducting the ASEC

in March is believed to provide better income data, because most households would either be in the process of 

completing or have just completed preparing tax returns 

and therefore would be more likely to remember income 

sources and amounts.

Although the structure and wording of income questions are similar in the CE and the CPS, there are major 

differences that can affect the estimates. In the CE, the 

respondent is asked to report the amount received from 

earned income, Social Security, Railroad Retirement, and 

Supplemental Security Income individually for each consumer unit member aged 14 years and older. For each of 

the remaining sources of income, the respondent reports 

the amount received by the consumer unit as a whole. In 

comparison, in the ASEC the respondent is directed to 

report individually the amount received for each source 
Income Imputation

28 Monthly Labor Review • August 2009

of income by each household member 15 years or older. 

Regarding income reference periods, the CE respondent is asked about the amount received over the last 12 

months for each source of income, with the exception 

of Social Security and Railroad Retirement income, for 

which the respondent reports the amount of the last payment received. If the respondent either refuses to answer 

or does not know the amount received for any of these 

sources, he or she is shown a card with ranges or brackets 

of income and then is asked to report which bracket best 

reflects the amount received. In the ASEC, respondents 

are asked to report the amount received over the calendar 

year. If they find that a year is too big a time span over 

which they can exercise recall, they are allowed to report 

for shorter periods. The periodicity of their response is 

asked if necessary.

Sources of income

With respect to the contents of the income questions, and 

using the CE questions as a basis for comparison, one readily sees that it is natural to consider earned income first, 

because it is by far the largest contributor to total income. 

The questionnaire in the Interview Survey asks the amount 

each eligible member of the consumer unit received in 

wages and salaries (including commissions, tips, allowances, 

Armed Forces pay, severance pay, teaching fellowships, and 

the like) for all jobs. The Interview Survey also collects data 

in a separate question on income or losses after expenses 

from each consumer unit member’s unincorporated nonfarm business, partnership, or professional practice, as well 

as income or losses from the consumer unit’s own farm. 

The ASEC asks for earnings, including tips, bonuses, overtime pay, and commissions, from the employer for whom 

the member worked longest during the calendar year. Such 

earnings can be wage and salary income, net income (or 

loss) from nonfarm self-employment, or net income (or 

loss) from farm self-employment. Three followup questions 

probe for earnings from other employers, other nonfarm 

businesses, and other farms. Severance pay and military allotments are included in earnings, and questions on these 

topics are asked in combination with questions on other 

miscellaneous sources of income after the questions for all 

other specific income categories have been asked.

The CE probes for amounts of Social Security and 

Railroad Retirement income received. These amounts include survivor and disability insurance payments, as well 

as retirement benefits. The ASEC asks separate questions 

about Social Security income and Railroad Retirement 

income. Data on Social Security income are obtained 

from a question on payments received by the household 

member directly or on behalf of children under age 19 in 

the household. Data on Railroad Retirement income are 

collected in questions covering three broad categories of 

income for which an individual may be eligible under the 

program: pension or retirement income, survivor benefits, 

and income related to a health condition or disability. 

Supplemental Security Income (SSI) is one of the few 

sources of income for which the CE and ASEC questions 

are essentially the same. Both surveys ask for the amount 

of SSI received from all government sources. Questions 

collecting data on interest income in the CE and ASEC 

also are quite similar. The only difference is in the potential 

sources of interest income referenced in the questions. The 

Interview Survey probes for interest from bank accounts, 

money market funds, certificates of deposit, or bonds, 

whereas the ASEC uses three questions that specifically 

screen for whether any members of the household have 

received any interest from money market funds, interestearning checking accounts, savings accounts, cashed savings bonds, treasury notes, individual retirement accounts 

(IRAs), certificates of deposit, or other investments that 

pay interest.

In one of its questions, the CE queries respondents for 

amounts of regular income from dividends, trusts, estates, 

or royalties. The types of income cited in this question 

also are found in a number of places in the ASEC questionnaire. One question is specifically directed toward 

dividends from stocks and mutual funds. Data on receipts 

from estates or trusts are collected in two places. The first 

is as a source of survivor benefits, the second as a class of 

property income. Data on net royalty income also are collected in the latter question.

Data on pension and annuity income, whether due to 

retirement, due to disability, or as a survivor, are collected 

through one question in the CE Interview Survey. Sources 

specified for such income are private companies, the military, government, IRAs, and Keogh plans. As mentioned 

earlier with regard to Railroad Retirement income, the 

ASEC inquires about retirement and pension income, survivor benefits, and disability income in separate questions. 

The question about retirement and pension income refers 

to all such income from a previous employer or union, or 

any other type of retirement income from sources other 

than Social Security or veterans’ benefits. With the exception of retirement income from Railroad Retirement, the 

income data collected here conceptually match CE counterpart data.

The ASEC query on survivor benefits also mentions 

widows’ pensions, insurance annuities, and other survivor 
Monthly Labor Review • August 2009 29

benefits (other than Social Security or veterans’ benefits). 

Income from survivor pensions from private companies; 

unions; Federal, State, and local governments; and the 

military are reported here. The ASEC questions concerning 

income related to a health condition or disability identify 

many of the same sources that are listed for survivor benefits, such as companies, unions, government at all levels, 

and the military. Finally, though not explicitly stated in 

the question, income received from foreign government 

pensions is offered as an example of one of the types of 

income the miscellaneous income question at the end of 

the ASEC is designed to capture.

Unemployment compensation and supplemental unemployment compensation are other sources of income 

cited in the CE Interview Survey questionnaire. The ASEC

poses three separate questions on unemployment compensation. One asks for the amount of State or Federal 

unemployment compensation, the second probes for income from supplemental unemployment benefits, and the 

third focuses on union unemployment or strike benefits. 

The CE asks respondents to combine income received 

from worker’s compensation or veteran’s benefits, including the GI bill, but excluding military retirement benefits, 

in one report. Worker’s compensation is surveyed in a 

distinct question in the ASEC, but the question also covers any other payments made as a result of a job-related 

injury or illness. Worker’s compensation benefits, including benefits for black lung disease, also are reported in 

the aforementioned ASEC questions on survivor benefits 

and disability income. The receipt of veterans’ benefit payments warrants its own question in the ASEC, but not in 

the CE.

Another question in the CE Interview instrument pertains to income received as public assistance or welfare. In 

2002, the questionnaire used Aid to Families with Dependent Children and grants from Job Corps as examples 

of such assistance. In subsequent years, the questionnaire 

was revised to refer specifically to cash assistance from 

any State or local government welfare program, such as 

Temporary Assistance to Needy Families, or short-term 

emergency help. The main question that seeks this information in the ASEC probes for cash assistance received 

from a State or county welfare program (with the name 

of a representative State program added as an example), 

either directly or on behalf of children in the household. 

The miscellaneous-income question at the end of the 

ASEC lists welfare, emergency assistance, and other shortterm cash assistance as examples of the types of income 

to be reported.

Two questions in the CE Interview Survey instrument 

cover any net income or loss from any type of rental of 

rooms or living units. The first question is directed toward 

collecting data on net income or loss from roomers or 

boarders; the second focuses on ascertaining data on net 

income or loss received from other rental units. The property income question in the ASEC, which was heretofore 

mentioned as a source for trust/estate and royalty income, 

also seeks information on net income or loss from rental 

property and receipts from roomers and boarders.

Child support payments not received as a lump sum are 

an additional component of income found in the CE Interview Survey. A similar question appears in the ASEC.

The CE Interview Survey questionnaire asks about 

regular income from alimony or other sources, such as income from persons outside the consumer unit. The ASEC

splits these sources between two questions, the first referring to alimony payments, the second to regular financial assistance from friends or relatives not living in the 

household.

Finally, the CE Interview Survey poses a catchall question seeking information about “other” money income. 

Among the sources from which this other money might 

have been received, the question lists cash scholarships 

and fellowships, stipends not based on working, and the 

care of foster children. All other income from a source 

not specified in previous questions is to be reported here. 

The ASEC contains a question requesting information on 

educational assistance for tuition, fees, books, or living 

expenses, including Pell Grants. Listed in this question 

as sources of educational assistance are scholarships and 

grants, as well as employers, friends, and relatives living outside the household. Assistance from any of these 

sources could be reported in a number of places in the CE. 

To the extent that a student is receiving regular payments, 

such payments would be reported as regular income from 

sources outside the consumer unit. If the assistance is 

earmarked for a particular educational expense, such as 

tuition, it could be reported in the educational expenses 

section of the CE as an expenditure for which reimbursement is received. The miscellaneous-income question at 

the end of the ASEC encompasses payment for caring for 

a foster child, as well as any other money income not already covered by earlier questions.

The ASEC is designed to cover the civilian noninstitutional population, plus those military personnel who live 

with at least one other civilian adult, on or off base. The CE

also is designed to represent the civilian noninstitutional 

population, plus a portion of the institutional population: 

residents of boarding houses; those living in student or 

worker housing facilities, such as college dormitories; 
Income Imputation

30 Monthly Labor Review • August 2009

staff units in hospitals or in homes for the aged, infirm, 

or needy; and those residing in permanent living quarters 

in hotels, motels, or mobile home parks. Nursing home 

residents are excluded, as are military personnel living on 

base. Off-base military personnel are included.

Comparison of CE and CPS income

Sources and timeframes. ASEC income data used in this 

article are derived from an unpublished Census table 

titled “In-House Table 8. Income Allocation by Income 

Source,” which the CPS produces annually for its internal use. For each source of income, the table shows the 

number of persons 15 years and older (in thousands) who 

receive income from that source and the mean amount 

of income they receive. Both those directly reporting 

income and those for which allocation is done are covered. In Census parlance, allocation is the equivalent of 

imputation in the CE. The means and numbers of persons 

reporting each source of income are multiplied together to 

obtain aggregate income.

The income categories shown here are the most detailed that can be constructed from the types of income 

provided in table 8 from the ASEC and the income Universal Classification Codes from the CE.

7

 Total aggregate 

income is composed of the following categories: wage and 

salary income; net nonfarm self-employment income; net 

farm self-employment income; unemployment compensation; workers’ compensation (including compensation for 

black lung disease) and veterans’ benefits; Social Security 

and Railroad Retirement income; Supplemental Security 

Income; public assistance; pensions and annuities; interest; dividends, rents, royalties, and estates and trusts; child 

support; and accident and temporary insurance, educational assistance, alimony, financial assistance, and other 

income not elsewhere classified.

As noted earlier, annual estimates of income for the 

CPS match the calendar year, while the annual estimates 

of income for the CE Interview Survey cover the year 

prior to the month of interview. Thus, a major issue in 

comparing CE and CPS income estimates is determining 

how to select consumer units for inclusion in the analysis. 

After due consideration, three estimators of CE income 

were chosen.

The first replicates the method used for producing income estimates in the CE-CPS income comparison tables 

(and the reference tables) that appear in CE publications.8

Recall that the CE Interview Survey collects expenditure 

data for the 3 months prior to the interview month; annual income reported by consumer units in their second 

or fifth interview is adjusted to fit the same period. In 

practice, this means dividing the annual amount by 12, 

thus creating a monthly amount, and then assigning that 

amount to each of the 3 months covered by the interview. 

For example, if a consumer unit reports $600 of interest 

income at its second interview in March 2006, this process will assign $50 ($600 ÷ 12) to each of the months from 

December 2005 through February 2006, the reference period for the interview. Second-interview income is carried 

forward through the third and fourth interviews before 

the income data are collected again at the fifth interview. 

Thus, at its third interview in June 2006, the aforementioned consumer unit would have $50 of interest income 

assigned to each of March, April, and May of 2006. The 

annual CE estimate for any calendar year will be calculated 

from all income assigned to that year.

Compared with the CPS estimate, the estimate created 

by this method uses a significant amount of income reported from an earlier period. With 2006 as an example, 

the first month whose interviews would be used in the CE

estimate is February. One-twelfth of the income reported 

in that interview would be assigned to January. However, 

the 12-month reference period for reporting would run 

from February 2005 through January 2006, meaning that 

11 months of the reference period would have been outside the calendar year of interest. April 2006 would be the 

first month in which one-twelfth of the annual income 

reported would be allocated to a 3-month reference period 

in which each month would be in 2006 ( January–March). 

Yet the recall period for income in the April 2006 interviews is April 2005–March 2006, a full 9 months of which 

still are outside the year of interest.

In fact, the only month whose interviews would span 

a recall period matching the ASEC calendar year is January of the next year. (For calendar-year 2006, interviews 

conducted in January 2007 would have an annual reference period from January 2006 to December 2006.) This 

fact forms the basis for the second method of creating 

CE estimates for comparison with CPS income estimates: 

only the second and fifth interviews conducted in January of the next year are used to construct the estimate. 

Although using such interviews would exactly match the 

period covered by the ASEC, the number of interviews is 

very small—about one-sixth of the number of interviews 

conducted in any one quarter. This small number of interviews would be detrimental to the statistical reliability 

of the estimate, potentially leading to wide annual swings 

in it, particularly for some of the more thinly reported 

categories of income.

Because of the conceptual attractiveness of the sec-
Monthly Labor Review • August 2009 31

ond method in matching the ASEC timeframe, the third 

method for creating CE estimates essentially expands on 

the second method. Centering on January interviews, this 

method adds the second and fifth interviews conducted 

between October of the previous year and April of the 

current year, or 3 months before and after January, to expand the number of interviews used in creating the estimate. As a result, one-seventh of the interviews report 

income earned in the year matching the calendar year. The 

earliest 12-month period, reported by one-seventh of the 

interviews, would run from October 1 of the previous year 

to September 30 of the current year; similarly, another 

one-seventh of the interviews would cover the latest 12-

month period, from April 1 of the current year through 

March 31 of the next year.

In all three methods, weighting adjustments are made 

to ensure that the aggregate estimates are representative of 

the entire population. The adjustments start with the fact 

that sample units in the CE Interview Survey are assigned 

population weights such that the sum of the weights for 

consumer units interviewed in a calendar quarter will equal 

one national population. Thus, for any month, the sum of 

the weights of interviewed units will be approximately 

one-third of the national population and the sum of the 

weights of units undergoing a particular interview—the 

second, third, fourth, or fifth—during that month will approximate one-twelfth of the national population.

To obtain a population-weighted estimate of CE income by the first method is straightforward because of the 

way annual income is mapped to the reference months of 

each interview. For example, all income assigned to March 

2006 would originate in interviews conducted from April 

through June of 2006. The weights assigned to consumer 

units interviewed during those 3 months would approximate one national population. Thus, one can calculate a 

nationally representative estimate of March 2006 income 

by applying the weights to the income reported. This procedure can be extended to each month of a calendar year, 

and then a weighted annual estimate for each year can be 

derived by summing the monthly estimates.

The weighting adjustment for the second method of 

estimating CE income also is fairly simple and is expanded 

to apply to the third method. The second method uses the 

second and fifth interviews in January of a survey year. 

These interviews represent approximately one-sixth of the 

interviews conducted in the first quarter of the year; thus, 

their weights are multiplied by 6 to produce a weighted 

national estimate. In the third method, the weights for 

the second and fifth interviews taken over the 7 months 

from October to April would represent about one-andone-sixth times the national population. Rather than deflate them all equally, it was decided that the weights for 

units undergoing their second and fifth interviews in the 

outlying months of October and April would be cut by 

one-half. This decision would be simple to implement and 

would assign greater weight to interviews conducted in 

months closer to the central month of January.

Results. The impact of imputation in the CE can be seen 

in table 1, which shows aggregate incomes, total and by 

source, from the CE and CPS, along with the ratio of CEto-CPS estimates for the years 2002–06. The CE did not 

impute for income nonresponse in the first 2 years of this 

period, so the estimates are based on all reported income, 

regardless of whether the consumer unit was considered a 

complete or incomplete income respondent.

Imputation significantly raises CE aggregate income, 

bringing it into near comparability with CPS estimates. 

On average, imputation adds about 20 percentage points 

to the CE/CPS ratio. For the preimputation period of 

2002–03, the mean CE/CPS ratio for total aggregate income, taking into account each method for estimating CE

income, is about 0.75. The average ratio for the postimputation period of 2004–06 rises to about 0.95.

This increase in the ratio for aggregate income is driven 

largely by the increase in wage and salary income after 

imputation in the CE. Wage and salary income accounts 

for about 80 percent of total CE income and 77 percent of 

total CPS income over the 2002–06 period. Before imputation, CE aggregate income averages about $1,650 billion 

less than CPS aggregate income, with CE wage and salary income trailing CPS wage and salary income by about 

$1,123 billion. The CE/CPS ratio for wage and salary 

income averages about 0.78. After imputation, the gaps 

between aggregate income and wage and salary income in 

the CE and CPS narrow to an average of about $462 billion 

and $179 billion, respectively. Wage and salary income for 

the CE almost matches the CPS estimate, with an average 

ratio of about 0.97.

Social Security and Railroad Retirement income is the 

next-largest component of total income in the CE and 

CPS. The story here is similar to the one for wage and 

salary income. The mean 2002–03 CE/CPS ratio is somewhat more than 0.80, while the 2004–06 ratio increases to 

slightly more than 0.95.

Imputation in the CE has a larger impact on the CE/

CPS ratio for nonfarm self-employment income, the thirdlargest contributor to total income, than for any other 

component of income. In fact, the ratio almost doubles after imputation, going from about 0.63 to a bit more than 
Income Imputation

32 Monthly Labor Review • August 2009

 

 

 Total Wage and salary 

 

 CE/CPS CE/CPS CE/CPS CE/CPS CE/CPS

 ratio ratio ratio ratio ratio

 2002

 CPS.......................................................... $6,515.7 ... $5,078.4 ... $302.6 ... $20.4 ... $37.9 ...

 CE, reference year 2002 .................. 4,629.0 71.0 3,736.3 73.6 197.8 65.4 14.9 72.8 14.7 38.7

 CE, January 2003............................... 4,858.1 74.6 3,880.9 76.4 204.3 67.5 4.2 20.3 13.2 34.8

 CE, October 2002–April 2003 ....... 4,838.7 74.3 3,890.2 76.6 198.6 65.6 18.5 90.7 20.1 53.0

 2003

 CPS.......................................................... 6,707.2 ... 5,157.1 ... 331.6 ... 28.0 ... 36.9 ...

 CE, reference year 2003 .................. 5,007.9 74.7 4,042.1 78.4 194.6 58.7 15.8 56.3 18.8 51.0

 CE, January 2004............................... 5,328.2 79.4 4,295.7 83.3 210.7 63.5 8.2 29.1 20.6 55.8

 CE, October 2003–April 2004 ....... 5,109.5 76.2 4,125.7 80.0 194.3 58.6 14.8 53.0 20.0 54.1

 2004

 CPS.......................................................... 6,939.6 ... 5,346.6 ... 321.7 ... 29.0 ... 25.0 ...

 CE, reference year 2004 .................. 6,322.2 91.1 5,021.3 93.9 338.4 105.2 22.6 77.8 18.6 74.3

 CE, January 2005............................... 6,689.9 96.4 5,119.7 95.8 566.6 176.1 15.7 54.0 22.4 89.5

 CE, October 2004–April 2005 ....... 6,636.6 95.6 5,206.3 97.4 435.1 135.2 11.3 38.9 16.4 65.4

 2005

 CPS.......................................................... 7,352.4 ... 5,630.6 ... 366.5 ... 37.3 ... 22.3 ...

 CE, reference year 2005 .................. 6,872.5 93.5 5,432.6 96.5 430.1 117.4 12.5 33.7 13.1 58.8

 CE, January 2006............................... 6,872.1 93.5 5,394.3 95.8 558.5 152.4 20.1 53.9 9.9 44.4

 CE, October 2005–April 2006 ....... 6,940.3 94.4 5,522.8 98.1 423.4 115.5 10.6 28.5 11.6 52.1

 2006

 CPS.......................................................... 7,800.6 ... 5,967.4 ... 407.7 ... 31.7 ... 20.7 ...

 CE, reference year 2006 .................. 7,170.8 91.9 5,718.6 95.8 414.0 101.5 14.7 46.5 12.8 61.9

 CE, January 2007............................... 7,332.3 94.0 5,994.1 100.4 445.0 109.1 13.1 41.5 16.0 77.3

 CE, October 2006–April 2007 ....... 7,286.8 93.4 5,815.2 97.5 380.1 93.2 26.7 84.3 11.0 53.5

 

 

 CE/CPS CE/CPS CE/CPS CE/CPS CE/CPS

 ratio ratio ratio ratio ratio

 2002

 CPS.......................................................... 36.4 ... 389.8 ... 25.9 ... 6.0 ... 262.5 ...

 CE, reference year 2002 .................. 7.7 20.4 312.9 80.3 23.3 90.0 4.1 67.8 178.7 68.1

 CE, January 2003............................... 6.5 17.2 299.1 76.7 19.5 75.2 4.2 69.6 217.4 82.8

 CE, October 2002–April 2003 ....... 7.1 18.7 315.9 81.0 20.8 80.3 4.6 76.6 203.4 77.5

 2003

 CPS.......................................................... 36.1 ... 410.1 ... 28.0 ... 7.1 ... 276.3 ...

 CE, reference year 2003 .................. 8.0 22.2 325.4 79.3 19.1 68.2 4.1 57.4 226.3 81.9

 CE, January 2004............................... 8.1 22.5 343.8 83.8 14.6 52.0 2.6 36.9 252.6 91.5

 CE, October 2003–April 2004 ....... 9.9 27.3 334.7 81.6 15.5 55.4 3.9 55.7 231.8 83.9

 2004

 CPS.......................................................... 39.9 ... 431.8 ... 30.6 ... 5.8 ... 291.9 ...

 CE, reference year 2004 .................. 8.9 22.4 400.0 92.6 20.8 67.9 4.7 82.1 280.1 96.0

 CE, January 2005............................... 11.6 29.0 431.0 99.8 13.4 43.8 5.6 97.5 300.0 102.8

 CE, October 2004–April 2005 ....... 8.9 22.4 411.4 95.3 18.9 61.9 5.0 87.4 316.3 108.3

 2005

 CPS.......................................................... 43.9 ... 449.2 ... 31.1 ... 6.6 ... 310.3 ...

 CE, reference year 2005 .................. 10.8 24.5 431.0 96.0 25.0 80.4 5.2 78.7 290.4 93.6

 CE, January 2006............................... 7.5 17.1 441.1 98.2 25.9 83.3 4.9 74.8 268.1 86.4

 CE, October 2005–April 2006 ....... 10.3 23.4 441.9 98.4 26.4 84.7 5.5 83.8 291.1 93.8

Aggregate pretax income and ratios for Current Population Survey (CPS) and for three alternative measures 

for Consumer Expenditure Survey (CE), by total and source of income, 2002–06

Aggregate Aggregate Aggregate Aggregate Aggregate

Unemployment

 compensation

Aggregate Aggregate Aggregate Aggregate Aggregate

Table 1.

Year and survey

[In billions of dollars]

Workers’ compensation 

(including compensation 

for black lung disease)

and veterans’ benefits

 Social Security and 

Railroad Retirement

Supplemental

Security Income

Public

assistance

Pensions and

annuities

Nonfarm 

self-employment

Farm 

self-employment
Monthly Labor Review • August 2009 33

1.22, making nonfarm self-employment income the only 

source of income for which the CE estimate is, on average, 

higher than the CPS estimate.

At about 4 percent of the total, pension and annuity 

income is the next-largest component of total income. 

After imputation, the CE/CPS ratio for pension and annuity income rises by an amount that is almost equivalent to 

that for Social Security and Railroad Retirement income. 

For 2002–03, the ratio averages just under 0.81, increasing 

to slightly under 0.93 for 2004–06. 

None of the nine remaining income components represents as much as 2 percent of total income reported in 

the CE. For the CPS, however, two categories—interest 

income; and income from dividends, rents, royalties, and 

estates and trusts—each make up more than 2 percent of 

total income. Hence, the CE/CPS ratios for these items are 

 

 

 

 

 

 ratio ratio ratio ratio ratio

 2006

 CPS.......................................................... $41.6 ... $471.5 ... $31.6 ... $5.6 ... $314.9 ...

 CE, reference year 2006 .................. 11.8 28.4 446.0 94.6 23.6 74.6 5.2 92.9 283.5 90.0

 CE, January 2007.............................. 8.4 20.1 409.1 86.8 26.6 84.1 4.9 87.9 213.6 67.8

 CE, October 2006–April 2007 ....... 13.5 32.4 452.2 95.9 25.9 81.8 5.0 90.2 302.6 96.1

 

 

 

 

 

 

 

 

 2002

 CPS.......................................................... 145.4 ... 119.7 ... 24.0 ... 66.7 ...

 CE, reference year 2002 .................. 36.9 25.4 50.3 42.1 13.3 55.3 38.1 57.2

 CE, January 2003............................... 39.8 27.4 48.9 40.9 13.3 55.3 107.0 160.5

 CE, October 2002–April 2003 ....... 41.7 28.7 57.3 47.8 14.3 59.6 46.3 69.5

 2003

 CPS.......................................................... 148.3 ... 152.4 ... 25.1 ... 70.0 ...

 CE, reference year 2003 .................. 47.9 32.3 60.7 39.8 17.1 67.9 28.0 40.0

 CE, January 2004............................... 38.2 25.7 63.2 41.5 21.5 85.4 48.5 69.2

 CE, October 2003–April 2004 ....... 43.4 29.2 65.6 43.0 16.9 67.4 32.9 47.0

 2004

 CPS.......................................................... 163.2 ... 157.0 ... 27.0 ... 70.2 ...

 CE, reference year 2004 .................. 59.0 36.2 85.3 54.3 19.2 71.1 43.1 61.4

 CE, January 2005............................... 59.0 36.1 50.6 32.2 21.7 80.5 72.6 103.5

 CE, October 2004–April 2005 ....... 49.8 30.5 81.0 51.6 21.0 77.7 55.2 78.6

 2005

 CPS.......................................................... 186.9 ... 169.8 ... 26.0 ... 72.0 ...

 CE, reference year 2005 .................. 61.9 33.1 99.9 58.8 19.2 73.8 40.7 56.5

 CE, January 2006............................... 37.6 20.1 45.1 26.6 17.0 65.4 41.9 58.1

 CE, October 2005–April 2006 ....... 61.3 32.8 71.9 42.3 19.6 75.4 43.9 60.9

 2006

 CPS.......................................................... 229.2 ... 186.7 ... 25.4 ... 66.6 ... 

 CE, reference year 2006 .................. 69.7 30.4 106.9 57.3 22.6 88.9 41.4 62.1

 CE, January 2007............................... 66.8 29.1 80.1 42.9 18.1 71.3 36.6 55.0

 CE, October 2006–April 2007 ....... 85.7 37.4 109.5 58.6 21.3 84.0 38.0 57.0

Interest Child support Dividends, rents, royalties, 

 and estates and trusts

Aggregate Aggregate Aggregate Aggregate

Aggregate Aggregate Aggregate Aggregate Aggregate

Continued—Aggregate pretax income and ratios for Current Population Survey (CPS) and for three alternative 

measures for Consumer Expenditure Survey (CE), by total and source of income, 2002–06

[In billions of dollars]

Table 1.

Year and survey

Accident and

temporary insurance,

educational assistance,

alimony, financial assistance,

and other income not

elsewhere classified

Pensions and

annuities

CE/CPS CE/CPS CE/CPS CE/CPS CE/CPS

Social Security and

Railroad Retirement

Supplemental

Security Income

Public 

assistance

CE/CPS

ratio

CE/CPS

ratio

CE/CPS

ratio

CE/CPS

ratio

Workers’ compensation 

(including compensation 

for black lung disease)

and veterans’ benefits
Income Imputation

34 Monthly Labor Review • August 2009

fairly low, and, historically, they have been among the lowest in the published tables. In addition, interest income 

is one of the few components whose CE/CPS ratio does 

not increase appreciably after imputation: on average, the 

aggregate preimputation interest income estimate in the 

CE is about 28 percent of the CPS estimate, while, after 

imputation, the estimate increases about 3.5 percentage 

points, to just under 32 percent of the CPS estimate.

Imputation does not have a marked impact on the CE/CPS

ratio for income from dividends, rents, royalties, and estates 

and trusts either, although the initial level of the ratio is higher 

than that for interest income. The ratio for 2002–03 averages 

midway between 0.42 and 0.43, and increases to an average of 

just over 0.47 after imputation.

Each of the remaining seven sources of income accounts for less than 1 percent of total income in each of 

the CE and the CPS. Thus, any change in the CE/CPS ratio 

after imputation has a tiny impact on overall aggregate 

income between the two surveys. In addition, the number 

of consumer units in the CE reporting income from these 

sources is often very low, particularly for the method of 

creating CE estimates from the second and fifth interviews 

from January of the next year. Hence, outlying values have 

a disproportionate impact on the calculated estimates.

Of the seven components still outstanding, two actually show a drop in the average ratio between 2002–03 

and 2004–06. The first of these is farm self-employment 

income, for which the CE-CPS ratio drops almost 3 percentage points, from slightly under 54 percent to 51 percent. The other component is an amalgam of individual 

income sources from each survey that could be combined 

into the category of accident and temporary insurance, 

educational assistance, alimony, financial assistance, and 

other income not elsewhere classified. The CE/CPS ratio 

for this component shows an even larger change between 

pre- and postimputation periods, dropping from an average of about 0.74 to approximately 0.66. For both of these 

components, and more strikingly for the latter, the wide 

swings in the CE estimates across years in the second and 

third estimation methods are due to infrequent reports 

of such income, a factor that offers an explanation for the 

drop in the ratio.

Examining the five remaining sources of income reveals, on the one hand, that the mean CE/CPS ratio for 

unemployment compensation rises significantly after imputation. The CE estimate for 2002–03 averages almost 

48 percent of the CPS estimate. For the 3-year period 

after imputation is introduced, the CE estimate rises to 

an average of more than 64 percent of the CPS estimate. 

On the other hand, for income from workers’ compensation (including compensation for black lung disease) and 

veterans’ benefits, the ratio of CE to CPS income changes 

very little after imputation, moving from about 0.22 to 

more than 0.24.

SSI is another income component for which the average ratio remains relatively stable subsequent to imputation. At a mean of about 70 percent of the CPS estimate 

in 2002–03, the CE estimate for SSI is the fifth highest 

among the components with respect to the CPS. Adding 

imputed SSI income to that reported by consumer units 

increases the CE estimate only to an average of somewhat 

under 74 percent of the CPS estimate during 2004–06. By 

contrast, child support income, a marginally smaller component of total income than SSI, exhibits a large increase 

in the CE/CPS ratio after imputation: the ratio averages 

slightly more than 0.65 for 2002–03, after which it rises 

to an average of well over 0.76 over the 3-year period that 

followed. The final and smallest source of total income, 

public assistance, displays the largest rise in the CE/CPS 

ratio after imputation began. The CE estimate averages 

under 61 percent of the CPS estimate in the 2 years prior 

to imputation, rising over the next 3 years to an average 

of slightly more than 86 percent of the CPS estimate, a 

greater-than-25-percentage-point increase.

The role of imputation

The preceding examination of the change in the ratio of 

CE income to CPS income after CE income estimates are 

augmented by imputation shows only part of the picture 

with respect to the impact of imputation on the relationship between the two measures. This section investigates 

more closely the magnitude of imputation as it affects the 

final aggregate estimates for total income and for each 

source of income in the CE and the CPS over the 2004–06 

period when imputation is done for both surveys.

Table 2 shows the percentage of CE and CPS aggregate income, both total and by source, accounted for 

by imputation for the 3 years during which it has been 

used in the CE. An examination of total income shows 

that about 37 percent of the CE aggregate is attributable 

to imputation, compared with about 33 percent in the 

CPS. On average, the percentage of imputed income in 

the CE has risen each year since the inception of imputation, while the percentage has remained stable in the CPS. 

Even though the CPS aggregates are larger than the CE

aggregates and the difference between the aggregates has 

risen from approximately $400 billion in 2004 to about 

$530 billion in 2006, the dollar amounts imputed in the 

CE are uniformly larger than the amounts imputed in the 
Monthly Labor Review • August 2009 35

 

 

 

 2004

Total aggregate income:

 CPS........................................................................................... $6,939.6 $4,603.6 66.3 $2,336.0 33.7

 CE, reference year 2004 ................................................... 6,322.2 3,944.6 62.4 2,377.5 37.6

 CE, January 2005 ............................................................... 6,689.9 4,318.1 64.5 2,371.7 35.5

 CE, October 2004–April 2005 ........................................ 6,636.6 4,274.2 64.4 2,362.3 35.6

Wage and salary:

 CPS........................................................................................... 5,346.6 3,672.9 68.7 1,673.8 31.3

 CE, reference year 2004 ................................................... 5,021.3 3,084.1 61.4 1,937.3 38.6

 CE, January 2005................................................................ 5,119.7 3,251.8 63.5 1,868.0 36.5

 CE, October 2004–April 2005 ........................................ 5,206.3 3,331.5 64.0 1,874.8 36.0

Nonfarm self-employment:

 CPS........................................................................................... 321.7 183.5 57.0 138.3 43.0

 CE, reference year 2004 ................................................... 338.4 145.2 42.9 193.3 57.1

 CE, January 2005................................................................ 566.6 261.2 46.1 305.4 53.9

 CE, October 2004–April 2005 ........................................ 435.1 179.9 41.3 255.2 58.7

Farm self-employment:

 CPS........................................................................................... 29.0 12.7 43.9 16.3 56.1

 CE, reference year 2004 ................................................... 22.6 8.1 35.9 14.5 64.1

 CE, January 2005................................................................ 15.7 7.5 48.1 8.1 51.9

 CE, October 2004–April 2005 ........................................ 11.3 4.1 36.7 7.2 63.3

Unemployment compensation:

 CPS........................................................................................... 25.0 18.7 74.8 6.3 25.2

 CE, reference year 2004 ................................................... 18.6 15.0 80.7 3.6 19.3

 CE, January 2005................................................................ 22.4 13.4 59.9 9.0 40.1

 CE, October 2004–April 2005 ........................................ 16.4 13.0 79.5 3.3 20.5

Workers’ compensation (including compensation 

 for black lung disease) and veterans’ benefits:

 CPS........................................................................................... 39.9 27.6 69.3 12.2 30.6

 CE, reference year 2004 ................................................... 8.9 6.6 73.5 2.4 26.5

 CE, January 2005................................................................ 11.6 10.6 92.1 .9 7.9

 CE, October 2004–April 2005 ........................................ 8.9 7.1 79.9 1.8 20.1

 Social Security and Railroad Retirement:

 CPS........................................................................................... 431.8 283.1 65.6 148.6 34.4

 CE, reference year 2004 ................................................... 400.0 312.4 78.1 87.7 21.9

 CE, January 2005................................................................ 431.0 349.6 81.1 81.4 18.9

 CE, October 2004–April 2005 ....................................... 411.4 329.9 80.2 81.5 19.8

 Supplemental Security Income:

 CPS........................................................................................... 30.6 21.8 71.2 8.8 28.7

 CE, reference year 2004 ................................................... 20.8 16.9 81.6 3.8 18.4

 CE, January 2005................................................................ 13.4 12.0 89.7 1.4 10.3

 CE, October 2004–April 2005 ........................................ 18.9 15.5 82.1 3.4 17.9

 Public assistance:

 CPS........................................................................................... 5.8 4.0 70.4 1.7 29.6

 CE, reference year 2004 ................................................... 4.7 3.7 77.4 1.1 22.6

 CE, January 2005................................................................ 5.6 4.6 81.4 1.0 18.6

 CE, October 2004–April 2005 ........................................ 5.0 3.8 74.7 1.3 25.3

 [In billions of dollars]

Table 2.

Total Reported 

Aggregate pretax income and percent distribution, total and by reported and allocated status, by source of income, 

Current Population Survey (CPS) and three alternative measures of Consumer Expenditure Survey (CE), 2004–06

 Percent

allocated

 Percent

reported Year, category of income, and survey Allocated
Income Imputation

36 Monthly Labor Review • August 2009

Continued—Aggregate pretax income and percent distribution, total and by reported and allocated status, by 

source of income, Current Population Survey (CPS) and three alternative measures of Consumer Expenditure Survey 

(CE), 2004–06

Table 2.

 Percent Percent

 reported allocated 

 

Pensions and annuities:

 CPS........................................................................................... $291.9 $193.6 66.3 $98.4 33.7

 CE, reference year 2004 ................................................... 280.1 221.4 79.0 58.7 21.0

 CE, January 2005................................................................ 300.0 256.9 85.6 43.1 14.4

 CE, October 2004–April 2005 ........................................ 316.3 254.5 80.5 61.8 19.5

Interest:

 CPS........................................................................................... 163.2 41.3 25.3 121.8 74.7

 CE, reference year 2004 ................................................... 59.0 27.8 47.0 31.3 53.0

 CE, January 2005................................................................ 59.0 38.8 65.9 20.1 34.1

 CE, October 2004–April 2005 ........................................ 49.8 24.7 49.7 25.0 50.3

Dividends, rents, royalties, and estates and trusts:

 CPS........................................................................................... 157.0 81.8 52.1 75.3 47.9

 CE, reference year 2004 ................................................... 85.3 53.7 62.9 31.6 37.1

 CE, January 2005................................................................ 50.6 34.4 67.9 16.3 32.1

 CE, October 2004–April 2005 ........................................ 81.0 48.6 60.0 32.4 40.0

Child support:

 CPS........................................................................................... 27.0 19.5 72.3 7.5 27.7

 CE, reference year 2004 ................................................... 19.2 16.7 86.8 2.5 13.2

 CE, January 2005 ............................................................... 21.7 19.1 87.9 2.6 12.1

 CE, October 2004–April 2005 ........................................ 21.0 18.9 89.9 2.1 10.1

Accident and temporary insurance, educational 

 assistance, alimony, financial assistance, and other

 CPS........................................................................................... 70.2 43.0 61.3 27.1 38.7

 CE, reference year 2004 ................................................... 43.1 33.3 77.3 9.8 22.7

 CE, January 2005................................................................ 72.6 58.1 80.0 14.5 20.0

 CE, October 2004–April 2005 ........................................ 55.2 42.6 77.1 12.6 22.9

 2005

Total aggregate:

 CPS........................................................................................... 7,352.2 5,026.8 68.4 2,325.7 31.6

 CE, reference year 2005 ................................................... 6,872.5 4,322.3 62.9 2,550.1 37.1

 CE, January 2006................................................................ 6,872.1 4,332.7 63.0 2,539.4 37.0

 CE, October 2005–April 2006 ........................................ 6,940.3 4,405.6 63.5 2,534.6 36.5

Wage and salary:

 CPS ........................................................................................... 5,630.6 4,002.1 71.1 1,628.4 28.9

 CE, reference year 2005 ................................................... 5,432.6 3,376.8 62.2 2,055.8 37.8

 CE, January 2006 ............................................................... 5,394.3 3,400.0 63.0 1,994.5 37.0

 CE, October 2005–April 2006 ....................................... 5,522.8 3,493.0 63.2 2,029.8 36.8

Nonfarm self-employment:

 CPS........................................................................................... 366.5 216.4 59.1 150.1 41.0

 CE, reference year 2005 ................................................... 430.1 187.7 43.6 242.4 56.4

 CE, January 2006................................................................ 558.5 229.6 41.1 328.9 58.9

 CE, October 2005–April 2006 ........................................ 423.4 181.0 42.8 242.3 57.2

Farm self-employment:

 CPS........................................................................................... 37.3 13.7 36.7 23.6 63.3

 CE, reference year 2005 ................................................... 12.5 2.2 17.7 10.3 82.3

 CE, January 2006................................................................ 20.1 12.1 60.1 8.0 39.9

 CE, October 2005–April 2006 ........................................ 10.6 6.2 57.9 4.5 42.1

Unemployment compensation:

 CPS........................................................................................... 22.3 17.0 76.2 5.3 23.8

 CE, reference year 2005 ................................................... 13.1 11.1 84.6 2.0 15.4

 CE, January 2006................................................................ 9.9 6.5 65.7 3.4 34.3

 CE, October 2005–April 2006 ........................................ 11.6 9.4 80.6 2.3 19.4

Year, category of income, and survey Total Reported Allocated

 [In billions of dollars]
Monthly Labor Review • August 2009 37

 [In billions of dollars]

Table 2.

 

 

 

Workers’ compensation (including compensation for 

 black lung disease) and veterans’ benefits:

 CPS........................................................................................... $43.9 $30.3 69.0 $13.6 31.1

 CE, reference year 2005 ................................................... 10.8 8.4 77.8 2.4 22.2

 CE, January 2006 ............................................................... 7.5 7.5 99.4 (

1

) .6

 CE, October 2005–April 2006 ....................................... 10.3 7.6 74.2 2.6 25.8

Social Security and Railroad Retirement:

 CPS........................................................................................... 449.2 301.8 67.2 147.5 32.8

 CE, reference year 2005 ................................................... 431.0 341.0 79.1 90.1 20.9

 CE, January 2006 ............................................................... 441.1 351.8 79.8 89.3 20.2

 CE, October 2005–April 2006 ....................................... 441.9 340.3 77.0 101.6 23.0

Supplemental Security Income:

 CPS........................................................................................... 31.1 22.7 73.1 8.4 26.9

 CE, reference year 2005 ................................................... 25.0 20.5 81.8 4.5 18.2

 CE, January 2006................................................................ 25.9 23.5 90.5 2.5 9.5

 CE, October 2005–April 2006 ........................................ 26.4 20.5 77.6 5.9 22.4

Public assistance:

 CPS........................................................................................... 6.6 5.0 76.4 1.6 23.6

 CE, reference year 2005 ................................................... 5.2 4.2 80.4 1.0 19.6

 CE, January 2006 ............................................................... 4.9 4.2 84.1 .8 15.9

 CE, October 2005–April 2006 ....................................... 5.5 4.5 81.7 1.0 18.3

Pensions and annuities:

 CPS........................................................................................... 310.3 211.4 68.1 98.8 31.9

 CE, reference year 2005 ................................................... 290.4 229.5 79.0 60.9 21.0

 CE, January 2006................................................................ 268.1 223.2 83.2 44.9 16.8

 CE, October 2005–April 2006 ........................................ 291.1 224.9 77.3 66.2 22.7

Interest:

 CPS........................................................................................... 186.9 54.8 29.3 132.1 70.7

 CE, reference year 2005 ................................................... 61.9 29.6 47.8 32.4 52.2

 CE, January 2006................................................................ 37.6 12.7 33.6 25.0 66.4

 CE, October 2005–April 2006 ........................................ 61.3 26.1 42.7 35.1 57.3

Dividends, rents, royalties, and estates and trusts:

 CPS........................................................................................... 169.8 87.3 51.4 82.5 48.6

 CE, reference year 2005 ................................................... 99.9 63.7 63.8 36.2 36.2

 CE, January 2006................................................................ 45.1 22.3 49.5 22.8 50.5

 CE, October 2005–April 2006 ........................................ 71.9 45.7 63.6 26.2 36.4

Child support:

 CPS........................................................................................... 26.0 19.5 75.0 6.5 25.0

 CE, reference year 2005 ................................................... 19.2 17.7 92.0 1.5 8.0

 CE, January 2006 ............................................................... 17.0 14.8 87.0 2.2 13.0

 CE, October 2005–April 2006 ........................................ 19.6 17.7 90.4 1.9 9.6

Accident and temporary insurance, educational

assistance, alimony, financial assistance, and other

 CPS........................................................................................... 72.0 44.7 62.0 27.3 38.0

 CE, reference year 2005 ................................................... 40.7 30.0 73.9 10.6 26.1

 CE, January 2006................................................................ 41.9 24.8 59.2 17.1 40.8

CE, October 2005–April 2006 ........................................ 43.9 28.7 65.3 15.3 34.7

Total Reported Allocated

Continued—Aggregate pretax income and percent distribution, total and by reported and allocated status, by 

source of income, Current Population Survey (CPS) and three alternative measures of Consumer Expenditure Survey 

(CE), 2004–06

 Percent

reported

 Percent

allocated Year, category of income, and survey

See note at end of table.
Income Imputation

38 Monthly Labor Review • August 2009

Continued—Aggregate pretax income and percent distribution, total and by reported and allocated status, by 

source of income, Current Population Survey (CPS) and three alternative measures of Consumer Expenditure Survey 

(CE), 2004–06

 [In billions of dollars]

Table 2.

 

 

 

 2006

Total aggregate income:

 CPS........................................................................................... $7,800.6 $5,226.9 67.0 $2,573.7 33.0

 CE, reference year 2006 ................................................... 7,170.8 4,354.7 60.7 2,816.2 39.3

 CE, January 2007................................................................ 7,332.3 4,435.1 60.5 2,897.3 39.5

 CE, October 2006–April 2007 ........................................ 7,286.8 4,492.4 61.7 2,794.4 38.3

 Wage and salary income:

 CPS........................................................................................... 5,967.4 4,163.5 69.8 1,803.9 30.2

 CE, reference year 2006 ................................................... 5,718.6 3,447.2 60.3 2,271.5 39.7

 CE, January 2007................................................................ 5,994.1 3,685.0 61.5 2,309.1 38.5

 CE, October 2006–April 2007 ........................................ 5,815.2 3,566.6 61.3 2,248.7 38.7

 Nonfarm self-employment:

 CPS........................................................................................... 407.7 227.3 55.7 180.4 44.2

 CE, reference year 2006 ................................................... 414.0 144.9 35.0 269.1 65.0

 CE, January 2007................................................................ 445.0 109.7 24.7 335.3 75.3

 CE, October 2006–April 2007 ........................................ 380.1 132.8 34.9 247.3 65.1

 Farm self-employment:

 CPS........................................................................................... 31.7 15.6 49.1 16.2 51.0

 CE, reference year 2006 ................................................... 14.7 5.1 34.3 9.7 65.7

 CE, January 2007................................................................ 13.1 2.8 21.4 10.3 78.6

 CE, October 2006–April 2007 ........................................ 26.7 17.5 65.6 9.2 34.4

 Unemployment compensation:

 CPS........................................................................................... 20.7 15.4 74.6 5.2 25.4

 CE, reference year 2006 ................................................... 12.8 9.5 74.2 3.3 25.8

 CE, January 2007................................................................ 16.0 10.5 65.7 5.5 34.3

 CE, October 2006–April 2007 ........................................ 11.0 8.2 74.4 2.8 25.6

 Workers’ compensation (including compensation for 

 black lung disease) and veterans’ benefits:

 CPS........................................................................................... 41.6 28.7 69.0 12.9 31.0

 CE, reference year 2006 ................................................... 11.8 8.4 71.4 3.4 28.6

 CE, January 2007................................................................ 8.4 4.7 55.6 3.7 44.4

 CE, October 2006–April 2007 ........................................ 13.5 10.4 77.1 3.1 22.9

Social Security and Railroad Retirement:

 CPS........................................................................................... 471.5 312.7 66.3 158.8 33.7

 CE, reference year 2006 ................................................... 446.0 345.5 77.5 100.6 22.5

 CE, January 2007................................................................ 409.1 309.2 75.6 99.9 24.4

 CE, October 2006–April 2007 ........................................ 452.2 349.9 77.4 102.3 22.6

Supplemental Security Income:

 CPS........................................................................................... 31.6 23.7 74.8 8.0 25.2

 CE, reference year 2006 ................................................... 23.6 18.9 80.0 4.7 20.0

 CE, January 2007................................................................ 26.6 22.5 84.6 4.1 15.4

 CE, October 2006–April 2007 ........................................ 25.9 21.2 82.1 4.6 17.9

 Public assistance:

 CPS........................................................................................... 5.6 4.1 74.5 1.4 25.5

 CE, reference year 2006 ................................................... 5.2 4.1 78.9 1.1 21.1

 CE, January 2007 ............................................................... 4.9 2.8 56.7 2.1 43.3

 CE, October 2006–April 2007 ........................................ 5.0 3.8 75.4 1.2 24.6

 Pensions and annuities:

 CPS........................................................................................... 314.9 212.0 67.3 102.9 32.7

 CE, reference year 2006 ................................................... 283.5 221.1 78.0 62.4 22.0

 CE, January 2007................................................................ 213.6 160.8 75.3 52.9 24.7

 CE, October 2006–April 2007 ........................................ 302.6 228.1 75.4 74.5 24.6

Year, category of income, and survey Total Reported Allocated Percent

 reported

 Percent

allocated
Monthly Labor Review • August 2009 39

CPS and the difference in imputed aggregate income has 

risen from about $35 billion in 2004 to around $260 billion in 2006.

As noted earlier, wage and salary income is the predominant component of total income, so the contribution 

of imputation to aggregate wages and salaries essentially 

matched the contribution to total income. Imputation is a 

bigger factor in the CE estimates than the CPS estimates, 

in terms of both the percentage of the estimate and the 

actual dollar value. In 2004, 37.0 percent of CE wages and 

salaries are a result of imputation, and the percentage rises 

to 37.2 percent in 2005 and 39.0 percent in 2006. Over the 

same 3 years, imputation accounts for about 30.1 percent 

of CPS wages and salaries. Wages and salaries imputed in 

the CE exceed those imputed in the CPS by about $220 

billion for 2004, rising to about $475 billion in 2006.

The two components of total income representing retirement income show remarkably similar patterns with 

respect to the effect of imputation, both internally and in 

relation to the CPS. Though starting from a lower level, 

the average percentage of imputed income represented in 

the CE estimates for Social Security and Railroad Retirement income and for income from pensions and annuities 

increases each year from 2004 to 2006. For the former 

component, the percentage goes from 20.2 percent to 

23.2 percent; for the latter component, it rises from 18.3 

percent to 23.8 percent. Nonresponse appears to have 

been less of an issue for the CE than for the CPS, because 

the CPS is seen to have imputed, on average, 33.6 percent 

of Social Security and Railroad Retirement income and 

32.8 percent of pensions and annuities over the 3-year 

span. With one exception, the income directly reported by 

respondents is $30 billion to $55 billion more for Social 

Security and $10 billion to $60 billion more for pensions 

and annuities in the CE than in the CPS.

More than one-half of the CE estimates for nonfarm 

self-employment income are derived from imputation. As 

with the sources of income mentioned in the previous two 

paragraphs, the average percentage of imputed income 

rises each year, but there is a sizable 11-percentage-point 

increase, from 57.5 percent to 68.5 percent, between 2005 

and 2006. Imputation in the CPS averages 42.7 percent 

over the 3-year period. The amount imputed in the CE 

estimates is significantly greater than the amount imputed 

in the CPS each year, although, seemingly paradoxically, 

the average difference is smallest, at just over $103 billion, 

Continued—Aggregate pretax income and percent distribution, total and by reported and allocated status, by 

source of income, Current Population Survey (CPS) and three alternative measures of Consumer Expenditure Survey 

(CE), 2004–06

 [In billions of dollars]

Table 2.

 

 

 

Interest:

 CPS........................................................................................... $229.2 $67.0 29.2 $162.1 70.7

 CE, reference year 2006 ................................................... 69.7 31.0 44.5 38.7 55.5

 CE, January 2007................................................................ 66.8 26.9 40.3 39.9 59.7

 CE, October 2006–April 2007 ........................................ 85.7 40.8 47.6 44.9 52.4

Dividends, rents, royalties, and estates and trusts:

 CPS........................................................................................... 186.7 94.8 50.8 91.9 49.2

 CE, reference year 2006 ................................................... 106.9 71.1 66.5 35.8 33.5

 CE, January 2007................................................................ 80.1 57.3 71.6 22.8 28.4

 CE, October 2006– April 2007 ....................................... 109.5 67.6 61.7 41.9 38.3

Child support:

 CPS........................................................................................... 25.4 18.2 71.6 7.2 28.5

 CE, reference year 2006 ................................................... 22.6 20.4 90.6 2.1 9.4

 CE, January 2007................................................................ 18.1 15.7 86.6 2.4 13.4

 CE, October 2006–April 2007 ....................................... 21.3 19.3 90.6 2.0 9.4

Accident and temporary insurance, educational 

 assistance, alimony, financial assistance and other

 CPS........................................................................................... 66.6 43.8 65.8 22.8 34.2

 CE, reference year 2006 ................................................... 41.4 27.5 66.6 13.8 33.4

 CE, January 2007................................................................ 36.6 27.3 74.7 9.3 25.3

 CE, October 2006–April 2007 ....................................... 38.0 26.2 68.9 11.8 31.1

Year, category of income, and survey Total Reported Allocated Percent

 reported

 Percent

allocated

1 Less than 0.1.
Income Imputation

40 Monthly Labor Review • August 2009

in 2006, the year in which imputed income makes up the 

largest proportion of the CE estimate.

Interest income and, to a lesser degree, income from 

dividends, rents, royalties, and estates and trusts show 

wildly different response patterns between the CE and the 

CPS. The percentage of imputed income incorporated into 

the CE estimates for interest income has varied from 45.8 

percent in 2004, to 58.6 percent in 2005, to 55.9 percent 

in 2006. The change in the percentage from year to year 

is attributable to swings in the percentage of income imputed in the CE estimate that is derived from January interviews only. The CPS derives an average of 72.0 percent 

of its annual estimates from imputation, and the actual 

dollar amounts imputed dwarf the amounts of imputed 

interest income in the CE by $100 billion to $120 billion.

The average percentage of imputed income for CE

dividends, rents, royalties, and estates and trusts over the 

2004–06 period peaks in 2005 at 41.0 percent and then 

drops the next year to 33.4 percent, the lowest of all 3 

years. In 2004, imputed income makes up 36.4 percent 

of this category. CPS estimates for dividends, rents, royalties, and estates and trusts are composed of a higher 

percentage of imputed income—on average, about 48.6 

percent—than is any CE estimate produced for the same 

period, with one exception: the 2005 CE estimate based 

on January 2006 interviews. In actual dollar amounts, the 

CPS uniformly imputes much higher amounts than does 

the CE, regardless of the way CE income is measured: on 

average, $83.2 billion dollars are imputed annually in the 

CPS, compared with $29.6 billion in the CE.

Turning to the two components whose CE/CPS ratios fall after imputation is instituted reveals that the 

first—farm self-employment income—shows average 

percentages of CE imputed income rivaling the levels for 

nonfarm self-employment income. For both 2004 and 

2006, almost 60 percent of CE farm self-employment income originates as a result of imputation, slightly more 

than the 54.8 percent of the farm self-employment income estimate imputed in 2005. The CPS imputes about 

$10 billion more of farm self-employment income than 

the CE imputes annually, although, as a percentage of 

the total, the CE and the CPS imputations differ by less 

than 2 percentage points (58.0 percent and 56.8 percent, 

respectively).

Imputation constitutes a much smaller proportion of 

CE income for the second category: accident and temporary insurance, educational assistance, alimony, financial 

assistance, and other income not elsewhere classified. The 

average percentage of imputed income for this category 

ranges from 21.9 percent in 2004 to 33.9 percent in 2005. 

The amount of income imputed by the CPS for the same 

category averages twice as much ($25.7 billion compared 

with $12.8 billion) as the amount imputed in the CE 

across all of the years examined. As a proportion of the 

total, imputed income makes up 37 percent in the CPS and 

28.6 percent in the CE.

Over the 2004–06 period, the annual average percentages of income imputed for unemployment compensation 

in the CE are fairly low and stable: 26.6 percent in 2004, 

23.0 percent in 2005, and 28.6 percent in 2006. However, 

a closer examination of the imputation percentages for 

each method of selecting CE observations shows that imputation is much more prevalent when January interviews 

alone are used, adding up to 6 percentage points to the 

average. Overall, the percentages imputed in the CE and 

the CPS are similar, differing from about 1 to 3 percentage 

points across the years studied.

For the category of workers’ compensation (including 

compensation for black lung disease) and veterans’ benefits, tracking the average percentages imputed in the CE

is somewhat misleading. In 2004 and 2005, the average 

percentages of income imputed are 18.2 percent and 16.2 

percent, respectively. The average percentage almost doubles in 2006, to 32.0 percent. These results are due almost 

solely to the relative paucity of imputation in estimates 

based on January interviews. In 2005, barely any income 

from this source—0.6 percent—is imputed for January 

2006 interviews. For the estimate based on interviews 

during the period from October 2005 to April 2006, the 

percentage imputed is 25.8 percent, and for the estimate 

based on the publication methodology, 22.2 percent results 

from imputation. In 2004, the situation is similar, though 

not so extreme. The respective percentages imputed are 

26.5 percent (publication method), 20.1 percent (October 2004–April 2005), and 7.9 percent ( January 2005). A 

complete reversal of this pattern occurs in 2006, with the 

percentage imputed for January 2007 interviews leaping 

to 44.4 percent while the percentages for the publication 

method and the October 2006–April 2007 interviews are 

28.6 percent and 22.9 percent, respectively, comparable to 

the rates posted in the earlier 2 years. Imputation in the 

CPS accounts for about 30.9 percent of such income, compared with 24.4 percent of income derived for the latter 

two methods in the CE.

On average, the percentages of SSI imputed in the CE 

are the second lowest of any component of total income. 

Although imputed income makes up an increasing share 

of the total each year of the period examined, the overall rise is small, going from 15.5 percent in 2004 to 17.8 

percent in 2006. CPS percentages of imputed income are 
Monthly Labor Review • August 2009 41

about 10 points higher than those in the CE (26.9 percent, 

compared with 16.7 percent), with actual dollar values imputed running more than twice as high as the CE’s ($8.4 

billion, compared with $3.9 billion).

Imputation in the CE for income from public assistance shows the interyear variability exhibited by other 

components, such as accident and temporary insurance, 

educational assistance, alimony, financial assistance, and 

other income not elsewhere classified, as well as interest 

income. The average percentage imputed swings from 22.2 

percent in 2004, down to 17.9 percent in 2005, and then 

up to 29.7 percent in 2006. As with these other sources, 

the variability in the case of income from public assistance 

can be traced to changes in percentages imputed for January interviews. The percentage of income resulting from 

imputation in the CPS is greater than that of the CE for 

the first 2 years of the period, but lower than the CE’s 

estimate for the final year.

The final component of total income, child support, 

shows both the lowest and most consistent average percentages of imputed income as a share of the total of any 

component of income in the CE. In 2005, only 10.2 percent 

of child support income—the lowest average percentage 

of the three years examined—is obtained via imputation. 

The highest percentage, only about 1.6 percentage points 

greater than the lowest, is 11.8 percent of the total, registered in 2004. The CPS imputes a much higher percentage of child support over the period, an average of 27.1 

percent, more than 3 times as much, on average, in dollar 

terms: $7.1 billion, as opposed to $2.1 billion.

WITH THE RELEASE OF 2004 DATA from the Consumer 

Expenditure Survey (CE), the BLS began implementing 

imputation for missing responses to income questions. 

The multistage procedure produced multiple imputed 

values for each missing observation. To assess how well 

these imputation routines performed, estimates of aggregate income based on both reported and imputed values 

were compared with estimates calculated from the Current Population Survey (CPS) for the years 2002–06. This 

period covered the 2 years prior to the introduction of 

imputation and the 3 years following.

Because of methodological differences between the 

CE and the CPS, three alternative measures of CE income 

were derived for comparison with the CPS. On average, 

prior to imputation CE estimates for total money income 

before taxes were about 75 percent of the CPS aggregate. 

After imputation, CE estimates rose to about 95 percent 

of the CPS estimate. An examination of individual sources 

of income reveals that, in general, imputation has brought 

CE estimates closer to CPS estimates, although significant 

disparities remain between the estimates for many of the 

smaller components. On the basis of these results, further 

refinements to the CE income questions and imputation 

procedures are expected.

The analysis presented in this article has used the Annual Social and Economic Supplement (ASEC) of the CPS

as a benchmark to which CE Interview Survey aggregates 

are compared. The Census Bureau, in its turn, evaluates the 

quality of ASEC estimates through comparison studies with 

other independent sources of income. In a similar vein, 

Daniel Weinberg has cited studies comparing CPS income 

data with national and State income data from the Bureau 

of Economic Analysis, with income data from the Census 

Bureau’s Survey of Income and Program Participation, and 

with earnings data from the Internal Revenue Service.9

Also, Bruce Webster has compared median household income and earnings estimates for 2004 and 2005 from the 

American Community Survey with CPS data.10 Comparing CE income estimates with these alternative sources, in 

addition to continuing work with the CPS, offers further 

avenues for analyzing the quality of CE income data.

Notes

ACKNOWLEDGMENT: Thanks go to Carmen DeNovas-Walt and Edward 

Welniak of the Income Surveys Branch of the U.S. Census Bureau for providing 

the CPS income data and reviewing the manuscript of this article.

1 For a comprehensive review and analysis of comparisons between CE and 

PCE expenditure estimates, see Thesia I. Garner, George Janini, William Passero, 

Laura Paszkiewicz, and Mark Vendemia, “The CE and the PCE: a comparison,” 

Monthly Labor Review, September 2006, pp. 20–46.

2 A consumer unit consists of (1) all members of a particular household 

who are related by blood, marriage, adoption, or some other legal arrangement; (2) a person living alone or sharing a household with others or living as 

a roomer in a private home or lodging house or in permanent living quarters 

in a hotel or motel, but who is financially independent; or (3) two or more 

persons living together who use their incomes to make joint expenditure decisions. Financial independence is determined by spending behavior with regard 

to the three major expense categories: housing, food, and other living expenses. 

To be considered financially independent, the respondent must be financially 

responsible for at least two of the three major expenditure categories, either 

entirely or in part.

3 See Thesia I. Garner and Laura Blanciforti, “Household Income Reporting: An Analysis of U. S. Consumer Expenditure Survey Data,” Journal of Official Statistics, March 1994, pp. 69–91, for more details.

4 Geoffrey D. Paulin and David L. Ferraro, “Imputing income in the Consumer 

Expenditure Survey,” Monthly Labor Review, December 1994, pp. 23–31.

5 Roderick J. A. Little and Donald B. Rubin, Statistical Analysis with 

Missing Data (New York, John Wiley and Sons, 1987), cited in Paulin and 
Income Imputation

42 Monthly Labor Review • August 2009

Ferraro, “Imputing Income.”

6 See Consumer Expenditure Survey, 1987, Bulletin 2354 (Bureau of Labor 

Statistics, June 1990), text tables 6 and 7; Consumer Expenditure Survey, 1990–

91, Bulletin 2425 (Bureau of Labor Statistics, September 1993), text tables 8 

and 9; Consumer Expenditure Survey, 1992–93, Bulletin 2462 (Bureau of Labor 

Statistics, September 1995), text tables 6 and 7; Consumer Expenditure Survey, 

1994–95, Bulletin 2492 (Bureau of Labor Statistics, December 1997), text 

tables 10 and 11; Consumer Expenditure Survey, 1996–97, Report 935 (Bureau 

of Labor Statistics, September 1999), text tables 8 and 9; Consumer Expenditure 

Survey, 1998–99, Report 955 (Bureau of Labor Statistics, November 2001), text 

tables 20 and 21; and Consumer Expenditure Survey, 2002–2003, Report 990 

(Bureau of Labor Statistics, March 2006), text tables 3–6.

7 Universal Classification Codes are six-digit codes that identify expenditure, income, and selected demographic variables at the most detailed level for 

use in CE data dissemination and CPI pricing activities.

8 Ibid.

9 Daniel H. Weinberg, “Income data quality issues in the CPS,” Monthly 

Labor Review, June 2006, pp. 38–45. 

10 Bruce H. Webster, Jr., “Evaluation of Median Income and Earnings Estimates: A Comparison of the American Community Survey and the Current Population Survey” (U.S. Census Bureau), March 12, 2007, on the Internet at www.

census.gov/acs/www/Downloads/Evaluation_of_Income_Estimates31207.

doc (visited Mar. 9, 2009).