The Trend in Lifetime Earnings Inequality and its Impact on the Distribution of Retirement Income

Center for Retirement Research at Boston College, 2001

Posted: 9 Mar 2010

See all articles by Barry Bosworth

Barry Bosworth

Brookings Institution - Economic Studies Program

Gary Burtless

Brookings Institution; Boston College - Retirement Research Center

Claudia Sahm

Independent

Multiple version iconThere are 2 versions of this paper

Date Written: August 1, 2001

Abstract

This paper examines the trend in career earnings profiles and lifetime earnings inequality using a new data set that links micro-census information from a Census Bureau survey (the Survey of Income and Program Participation, or SIPP) with the summary earnings records (SER) maintained by the Social Security Administration. It then considers the implications of these trends for the trend of Social Security replacement rates and future changes in the inequality of pension income. The data set covers men and women born in successive years between 1926 and 1965 using a combination of observed and predicted earnings.

Our analysis finds that aggregate male wage and employment patterns have remained much more stable than is the case for women. Although less educated men in recent birth cohorts have fared worse than men in earlier cohorts who had the same schooling, the increase in average educational attainment has largely offset the employment and relative wage losses suffered by less educated men. Among women, while female employment rates and average earnings remain lower than those of men of the same age, the male-female gap is now much smaller than it was in earlier cohorts. The age pattern of employment and earnings among women is growing more similar to the pattern observed among men.

Suggested Citation

Bosworth, Barry and Burtless, Gary T and Sahm, Claudia, The Trend in Lifetime Earnings Inequality and its Impact on the Distribution of Retirement Income (August 1, 2001). Center for Retirement Research at Boston College, 2001, Available at SSRN: https://ssrn.com/abstract=1127808

Barry Bosworth (Contact Author)

Brookings Institution - Economic Studies Program ( email )

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Gary T Burtless

Brookings Institution ( email )

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Claudia Sahm

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