Ranges of Income, Notes

Numbers Institute, PO Box 1320, Shepherdstown WV 25443, LR@NumbersInstitute.com

These teaching notes accompany a poster which shows data on 200 occupations in the US.

The poster shows typical incomes in 200 occupations. The data come from surveys in 1992-1994, and have been converted to 1995 prices. The data include a representative sample of US workers, with a few exceptions (see last paragraph of Methodology). The figures include people who work for themselves, as well as people who work for others.

Thickness of Lines. The thickest lines show the most common occupations: managers, sales supervisors (including people who run their own shops), secretaries, and truck drivers. These have millions of workers and thousands of interviews in the sample. For example there are four million sales supervisors, and 3,300 of them in our sample. The thinnest line represents 29,000 Optometrists.

Length of Lines. The length of each line shows the range of incomes where most workers fall. Most people earn in this range. We hope you will not be in the bottom fifth of workers, who earn less than the bottom of the line. We do hope you will be in the top fifth of workers, who earn more than the top of the line, but you should not count on it. You will probably be in the 3/5 of workers who are somewhere along the line. Since 1995, and in the future, dollar levels rise with inflation and economic growth, but the relative positions of jobs change slowly, if at all.

Occupations and Jobs. Each line shows an occupation, or a group of similar occupations. Jobs vary in each occupation, for example junior and senior managers, small and large farmers, local and long distance truck drivers. Earnings vary for these different jobs in each occupation. Earnings also vary in different parts of the country; and for other reasons, causing the variation of incomes shown by the length of each line.

Turnover. There is a scale of percents up and down the poster, labeled in the left margin as Turnover. The range goes from very stable jobs at the bottom left, to average turnover in the upper left. The scale continues in the bottom right, and ends with the most transient jobs in the upper right, where a third of workers change employers each year.

Turnover suggests job openings. Even more important, turnover measures job quality: jobs where people stay are usually desirable. Different people have different needs in their jobs, and a general survey cannot measure all aspects of job quality, but turnover, like pay, is a starting point for thinking about attractive and unattractive jobs. Notice that jobs with higher turnover usually do not compensate with high pay. On the contrary, jobs with low turnover often have the highest pay, which is part of the reason people don't leave these jobs.

Turnover includes people changing employers in the same field, as well as people changing occupations. It includes changes from self-employment to working for someone else, and the reverse. It does not include self-employed people changing from one client to another, like a musician or electrician, nor people starting their first job or retiring.

Women and Men. The dot on each line shows the fraction of workers who are women. For example if the dot is a quarter of the way from the left end to the right, a quarter of the workers are women. It is striking that traditionally male and female jobs are still overwhelmingly male or female: Firefighters, brick masons, carpenters, electricians and roofers are almost all men. Secretaries, child care workers, dental hygienists and receptionists are almost all women.

Women's and Men's Pay. There are tick marks at the top and bottom of most lines. These show the median earnings of women and men (median means half the women (or men) earn less than this point, half earn more). These figures are not adjusted for type of work, experience, or education. Women earn less, because of discrimination and because of these other reasons.

Ticks are omitted if samples are too small. Ticks can be to the left of the line if the median income for one sex is less than the 20th percentile of both sexes, (see "Supervisors, manufacturing," at 5% turnover).

Minorities. The poster does not compare data on minorities and whites, though the story would be similar to the story for women and men. The problem was with sample sizes in many occupations. Even for women, the sample sizes were often not large enough to show separate data, and the samples were smaller for minorities.

Part Time. The slash on each line shows the fraction of workers who work less than 35 hours per week at their main job. (If the fraction is less than 5%, it is not shown, to avoid crowding the end of the line.) This part time fraction is quite low in most jobs. Working hours fell steadily in the US from 1900-1940, and have fallen very little since. Some large employers, like the US government, do give proportionate fringe benefits to part time workers, based on hours worked. Even these employers have few part time workers. Other employers give no benefits to part time workers (of course many employers give no fringe benefits to anyone). People have spent their increased prosperity since 1940 on larger homes for smaller households, on health care, and on retirement, rather than on shorter work weeks.

For Guidance Counseling. A main purpose of the poster is to help people think about jobs different from the ones they know about. The poster can open people's eyes to the wide variety of jobs. They can then read appropriate references, and talk to employers and workers to find more information on these jobs in their local area.

A group of students can divide up interesting jobs, and (individually or in pairs) do library research and interview companies and workers about these jobs. It is great if students interview workers just a few years out of school, to learn what experiences they had finding work and fitting in.

For Economics. The poster can start discussions on earnings, turnover, supply and demand for labor, transferability of skills, part time and full time work, economic power of employers and unions, restrictions on entry (ranging from lawyers to carpenters and hairdressers). Theory says that competitive employers with perfect information will pay workers according to how productive the workers are (or a little more, to reduce the cost of turnover). However, sometimes there is little competition between employers, and unions reduce competition between workers. Also, both employers and workers have poor information about worker productivity, either before or after a worker is hired (especially in services, where most people work). Therefore social expectations, luck and bargaining determine pay too.

For Mathematics. Students can draw similar graphs with other data, perhaps every 2-3 weeks. They can get data from the web, almanacs and elsewhere: birth and death of presidents; number of males and females in different TV shows, in literary works, and in textbooks; present and future population of countries; crime or death rates for different crimes or diseases, now and in the past; etc. If they design a very large graph, they might add to it every 2-3 weeks.

Value Judgments. Readers react to this poster with their own value judgments. Jobs with great skill, training or stress usually, but not always, pay more than average. Do they pay enough more or too much? Some jobs earn much less than others, even important, skilled and stressful jobs, like child care workers. Why? Women earn consistently less than men even in jobs like teaching, where most workers are women, and even though many managers, including personnel managers, are women. What would it take to reach equality? Many jobs are virtually all male or all female. How can workers of the opposite sex break in and avoid harassment? People who want part time work so they can pursue other interests or raise families, have a limited choice of good part time jobs. How can they convince managers to pay salary and benefits proportionately for part time work?

Methodology

People are shown at their actual weekly or monthly incomes, converted to an annual total and to January 1995 dollars, using the Consumer Price Index. If they worked 15-39 hours per week, we converted income to full time (40 hrs/wk) equivalent. If they worked less than 15 hours per week, they are not in the income figures, but they are included in the total number of workers, percent part time, and turnover. If they worked 40 or more hours per week they are included in all figures, without adjustment.

We pooled the data from three surveys, 1992-94, to increase sample sizes and reliability. Every figure shown is based on a sample of at least 25 workers. This minimum sample size is a rule of thumb, which is also used in Census Bureau publications, to minimize errors. Only the thinnest lines are based on so few cases. Thicker lines show that in most occupations there are more workers, and hence more sample size. An occupation is printed if there are at least 25 workers reporting income in the occupation. The median income for women (or men) is shown only if there are 25 women (or men) in the occupation. Therefore a small occupation, like personnel managers (bottom right), with relatively few men, shows no median income for men. Our sample has 51 personnel managers: 35 women, and 16 men. For a few jobs, we cannot show median for either women or men. Our sample has only 28 insurance underwriters (upper left): 22 women and 6 men. Even some fairly common jobs have too few women to show a reliable median for women, like carpenters, with samples of 3 women and 925 men (between 17% and 18% turnover). The total sample size for all occupations included on the poster is about 61,000 workers. Weights are not equal, since we had a greater sampling rate for self-employed people than for others.

Notice for farmers, the line starts at zero, since the lowest 20% of farmers actually lost money. The figures on the poster only include earnings from the job, not income from other sources, like dividends or capital gains from investments, or pensions from earlier jobs. This is a survey, so some people may not have reported income accurately. The worst underreporting may be for people with a lot of cash income.

For people who change jobs during a year, the original surveys did not collect the total earnings from each job separately. We needed these totals, to compare the actual earnings in different occupations. We took two different approaches to obtain the needed data. Among people who worked for others, we use earnings of the main job in the most recent week (middle of March each year, since the survey was done in the third week of March), and multiply by 52 to have a full year of pay. This does not allow for the fact that in some jobs full year work is not available, but it does put weekly earnings on a comparable basis. Among people who were self-employed in the previous week, the survey does not collect income for that week, but it does collect total earnings in the previous year, number of weeks worked that year, and number of jobs held that year. Therefore we based the earnings of self-employed people on the self-employed who had only one job in the previous year (so all earnings refer to the one job). This assumes that self-employed people who changed jobs had similar incomes, while working, to people in the same occupation with one job, but the effect is small. For the number of workers, turnover and percent women, we included all self-employed people, so these figures are not affected at all.

The surveys cover most workers who live in the US, whether citizens or not. The surveys exclude the military, workers under 15 years old, and people who are homeless or live in institutions (though those rarely have jobs). Data for people who could not be found or refused to answer were estimated by the Census Bureau, based on people who did answer. Besides those exclusions from the survey, the poster excludes occupations that have very few workers, like garbage collectors (sample of 20), statisticians (5) and trappers (1). The Numbers Institute used the raw data for each worker, collected or estimated by the Census Bureau; then grouped people into related occupations as necessary; and calculated all the incomes and percentages shown on the poster.

Readings. Books on jobs are in libraries under Dewey Decimal 331, 338 and 371. US government reports describe many jobs: (a) Occupational Outlook Handbook, (b) Selected Characteristics of Occupations Defined in the Dictionary of Occupational Titles, (c) Area Wage Surveys, (d) Monthly Labor Review, (e) Employment & Earnings (monthly), (f) Standard Occupational Classification Manual. A private book, American Salaries & Wages Survey by Merlita Reddy of Gale Research, summarizes many local surveys.

Many associations publish surveys of pay (eg professors, by college, in Chronicle of Higher Education every April; florists in Floral Finance). Students can find associations on the web and search for recent studies on pay in the occupations which interest them.