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Master in Business Communication in Foreign Languages

INTERNATIONAL STATISTICS Prof. Liviu-Stelian BEGU, PhD

PART.1

STATISTICS OF MACROECONOMIC AGGREGATES

Macroeconomics is concerned with the behavior of economy as a whole- with booms and recessions, the economys total output of goods and services and the growth of output, the rates of inflation and un employment, the balance of payments over long periods of time and with the short-run fluctuations that constitute the business cycle. The basic macroeconomic aggregate estimated within the System of National Accounts1. Gross Domestic Product (GDP) = the market value of all final goods and services produced within a country in a given period of time. There are four methods of estimating GDP: a) The production approach is summing up the gross output of businesses after subtracting the intermediate consumption. b) The consumption approach is based on the following equation: GDP = Cp + Cg + FBC + EN where: Cp = Private Consumption; Cg = Government purchases; Cp + Cg = Final Consumption
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The System of National Accounts consists of a set of coherent,consistent and integrated macroeconomic accounts, balance sheets and tables. It is based on internationally agreed concepts,definitions, classifications and accounting rules.

FBC = Investment (Gross Fixed Capital Formation); EN = Net Exports = Exports Imports Consumption = spending by households on goods and services, with the exception of purchases of new housing. Investment = spending on capital equipment, structures, including household purchases of new housing. Government purchases central governments. inventories and

= spending on goods and services by local and

Net exports = spending on domestically produced good by foreigners (exports) minus spending on foreign good by domestic residents (imports). c) The income approach equals the GDP with the total value of income received by factors involved in its production and is composed of wages, rentals and profits. d) The expenditure approach takes into account the fact that besides private consumption and savings, the GDP is influenced by the direct taxes and the depreciation of capital goods used in the economy during the reference period of time. Nominal versus Real GDP. Nominal GDP = the production of goods and services valued at current prices. Nominal GDP measures the value of output at the prices prevailing in the period during which the output is produced. Real GDP = the production of goods and services valued at constant prices. Real GDP measures the output produced in anyone period at the prices of some base year. The GDP Deflator = a measure of the price level calculated as the ratio of nominal GDP to real GDP times 100:
GDPDeflator = No min alGDP 100 Re alGDP

"Net" versus "Gross" measures.


It is important to recognise that, GDP is a measure of unduplicated production despite the use of the word "gross" in "gross domestic product". The reference to "gross" indicates that consumption of fixed capital is included in the total. In other words, the extent to

which the economys productive assets are used up over time in producing output has not been deducted from total production when calculating GDP. The estimate of overall production, which also takes into account the fact that capital is being used up in the course of production, is "net domestic product" (NDP). While NDP provides a purer measure of production than GDP, placing a value on consumption of fixed capital is a difficult process. In practice, consumption of fixed capital is not calculated on a consistent basis between countries and so GDP is generally preferred to NDP as the summary measure of a countrys economic activity.

Gross National Product (GNP) = is the value of all final goods and services produced by domestically owned factors of production within a given period.
There is a distinction between GNP and GDP. GDP is the value of final goods produced within the country. Part of GNP is earned abroad.

The Consumer Price Index (CPI) = measures the cost of buying a fixed basket of goods and services representative of the purchases of consumers.
CPI measures the evolution of prices for goods purchased and tariffs for services used by the population in a certain period (current period) as against a previous period (basic or reference period). CPI is calculated only for elements from population direct consumption, excluding: consumption from own resources, investment and accumulation expenditures, interest paid to credits, insurance rates, taxes, etc., as well as expenditures for labor payment in agricultural production of individual households. CPI is calculated as an index of Laspeyres type with fixed base.

i q p CPI = q p
p 0 0 0

where: i p = prices index ( i p =

p1 ); p0 q 0 = quantity in basic period;


p 0 = level of prices in basic period.

The Producer Price Index (PPI) = measures the evolution of prices for industrial products/services manufactured and delivered by domestic producers in a certain period (current period) as against previous period (basic period), at the level of the firs significant commercial transaction.
PPI is calculated as an index of Laspeyres type with fixed base.

PPI = where: i p = prices index ( i p =

i q p q p
p 0 0 0

p1 ); p0 q 0 = quantity in basic period;


p 0 = level of prices in basic period.

Romanian Economy:
PERIOD GDP ROL bill. (nominal) 373798,2 545730,2 803773,1 1167687,0 1514750,9 1903353,9 2387914,3 Exchange Rate (ROL/EUR) 9989 16296 19956 26027 31255 37556 40532 GDP (EUR bill.) (real) 37,42 33,49 40,28 44,86 48,46 50,68 58,91 FBC (ROL bill.) (nominal) 67919,9 96630,4 151947,2 241153,6 322836,0 422535,1 526555,8 FBC (EUR bill). (real) 6,80 5,93 7,61 9,27 10,33 11,25 12,99 CP (ROL bill.) (nominal) 310922,7 453308,0 634590,4 917185,7 1169404,2 1483480,7 1902606,2 CP (EUR bill.) (real) 31,13 27,82 31,80 35,24 37,41 39,50 46,94 CG (ROL bill.) (nominal) 26545,9 31053,5 57942,5 77551,4 103287,9 131540,8 163774,8 CG (ROL bill.) (real) 2,66 1,91 2,90 2,98 3,30 3,50 4,04

1998 1999 2000 2001 2002 2003 2004

coefficient of correlation GDP/FBC:

0,996

coefficient of correlation GDP/CP:

0,993

coefficient of correlation GDP/CG:

0,970

Master in Business Communication in Foreign Languages


INTERNATIONAL STATISTICS Prof. Liviu-Stelian BEGU, PhD

PART.2

STATISTICS OF EXTERNAL DEBT

In this paper we studied only the indicators referring to external debt. A brief explanation to each of them is given below.

Total Population (Populatia totala) Total population is based on the de facto definition of population, which counts all residents regardless of legal status or citizenship--except for refugees not permanently settled in the country of asylum, who are generally considered part of the population of their country of origin. GDP (PIB) GDP at purchaser's prices is the sum of gross value added by all resident producers in the economy plus any product taxes and minus an subsidies not included in the value of the products. It is calculated without making deductions for depreciation of fabricated assets or for depletion and degradation of natural resources. Data are in current U.S. dollars. Dollar figures for GDP are converted from domestic currencies using single year official exchange rates. For a few countries where the official exchange rate does not reflect the rate effectively applied to actual foreign exchange transactions, an alternative conversion factor is used. Exchange rate (curs de schimb) The rate used to transform the national currency in USD or EURO. External debt (datoria externa)

Debt owed to creditors outside the country. This includes debt owed to private commercial banks, debt owed to other governments or debt owed to the international financial institutions such as the IMF and World Bank. It does not include commercial credits with due data less than an year and loans conducted by citizens.

Exports (exporturi) Goods and services one country produces and sells to others. The opposite of imports, strong exports are necessary to have a favorable balance of trade. External debt index (indicele datoriei externe IDE 1/0) is used to analyze the dynamics of the size of

It

the

external

debt.

IDE1 / 0 =

DE1 100 DE0

External debt percentage (ponderea datoriei externe PDE) Its more a theorethical indicator, and it shows how much of the years GDP should be used to payback the actual external debt.
PDE = DE 100 GDP

External debt/Exports ratio (raportul dintre datoria externa si incasarile din exportul de marfuri si servicii DEX) It is an indicator measured in years and it shows the number of annual exports needed to fully cover the existing external debt.
DEX = DE X

External debt per person (datoria externa pe locuitor DEP) It is the ratio of the external debt and the years total population. The results expresses the amount owed to foreign countries by each individual at a given moment.
DEP = DE P

External Debt Analysis COUNTRY: Albania Currency: Leka

An/Indicator Population (mil.)

1998 3,35

1999 3,37

2000 3,4

2001 3,06

2002 3,1

2003 3,13
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Exports (mil USD) External Debt (mld USD) GDP (mld leka) Exchange Rate (leka/USD) GDP (mld USD) IDE % DEP (USD/loc) DEX PDE %

205 0,8 425,3 151,2 2,81 100% 238 3,9 28,4

275 1 488,6 137,7 3,54 125% 296 3,63 28,2

255 1,1 551,2 143,7 3,83 110% 323 4,31 28,7

305 1,2 611,6 143,6 4,25 109% 392 3,93 28,2

330 1,3 677,2 132,2 5,12 108% 419 3,93 25,3

380 1,6 744,9 130 5,73 123% 511 4,21 27,9

Conclusions
According to the methodology set by the World Bank regarding the classification of developing countries, Albania could be classified as a medium income country (838$/person in 1998 and 1830$/person in 2003). However, lets not forget that the country still depends heavily on tens of thousands of Albanians working in Greece, Italy, and Germany who send hard currency at home to support their families. Although we cannot overlook their slight economic gron th, we could say it is still an artificial one, since there are a lot of reforms waiting to be done in order for Albania to have a reliable market economy. If we take into account their debt level, Albania is a heavily indebted country, with DEXes having alarming values. The DEX (raportul dintre datoria extern i ncasrile din exportul de mrfuri i servicii) shows how many annual exports would be needed to instantly cover the whole external debt. It is measured in years, and when the value is over 2, it should be an alarming issue for all the governmental decision factors. Our analysis show values well above 3, reaching even 4,31 in 2000. Although the GDP has improved in the 1998 2003 period, the external debt has grown continuosly, while the exports were still fluctuating, showing a recovery only in the last 3 years. However, the main cause of their sloppy economy is not the degree of debt. An relatively high external debt should not be regarded as a worrying thing. A lot of recovering countries adopt similar measures and make borrowings, as a starting point in the attempt to relaunch a fallen economic market. However, parts of these debts have to be paid annualy, and a solid payment strategy should rely on real GDP growth and increasing exports. Albania still has to face these two problems. The lack of proper functioning of these two elements would lead to a situation similar to Romanias, where everything looks good on paper while the high level corruption, a poor legal framework and inefficient economic measures are constantly undermining all the external aid efforts.

Business Communication in Foreign Languages


INTERNATIONAL STATISTICS Prof. Liviu-Stelian BEGU, PhD

PART.3 BALANCE OF PAYMENTS


Balance of payments, balance between all payments out of a country within a given period and all payments into the country, an outgrowth of the mercantilist theory of balance of trade. Balance of payments includes all payments between a country and its trading partners and is made up of the balance of trade, private foreign loans and their interest, loans and grants by governments or international organizations, and movements of gold (capital account). A chronically unfavorable balance of payments, when debits exceed credits, may affect the stability of the nation's currency, particularly where exchange rates are no longer fixed. After World War II the International Monetary Fund was established to handle problems relating to the balance of payments and foreign exchange. Since the late 1950s the United States has generally experienced an unfavorable balance of payments because of large-scale foreign aid, sizable U.S. investment in Europe, and major U.S. military investments abroad. In the early 1970s the United States, in an effort to create a more favorable balance of payments, announced (1971, 1973) a devaluation of the U.S. dollar. However, the increase in the cost of petroleum from the Arab states (197374) had a negative effect on the balance of payments in the United States and most countries in Western Europe. In addition, tight money policies and high deficits adversely affected the savings rate in the United States in the 1980s and caused the balance of payments to decline even further. As a result, the United States looked to foreign borrowing to fill the gap, but the interest payments only increased the shortfall in the balance of payments. In the late 1990s and 2000s the U.S. balance of payments reached record negative levels. 8

Bibliography See N. Fatemi, Problems of Balance of Payment and Trade (1975); T. De Saint Phalle, Trade, Inflation, and the Dollar (1981); D. Bigman, ed., Floating Exchange Rates and the State of World Trade Payments (1984). The balance of payments is a measure of the payments that flow from one country to another. It is determined by a country's exports and imports of goods, services, and financial capital, as well financial transfers.

Overview
If more money flows in than out, one has a positive balance of payments; if more flows out than in, one has then a negative balance. The money flowing over the border is like other money paying for goods, commodities, real estate, services, securities. A country's international transactions can be grouped into three categories: (I) Current Account

Exports

1. Merchandise (tangible goods) 2. Services (invisible trade, eg. legal, consulting, royalties, patents etc.) 3. Factor Income (interest, dividend or any other foreign investment income)

Imports

1. Merchandise 2. Services 3. Factor income

Unilateral Transfers (one way "unrequitted" payments, eg.foreign aid, grants, gifts etc.)

(II) Capital Account 1. Foreign Direct Investment (FDI) 2. Portfolio Investment o Equity Securities o Debt Securities 3. Other Investment (transactions in currency, bank deposits, trade credits etc.) 4. Statistical discrepancies

(III) Foreign Reserves

Official Reserve account, includes gold, foreign exchanges, SDRs, reserves in IMF

current account: records net flow of money into a country resulting from trade in goods and services and transfer payments made from abroad. The current account itself comprises of 3 accounts : trade account, income account and transfers account. A trade deficit(surplus) arises when there is a deficit(surplus) in the Merchandise trade within the current account capital account: records net flow of money from purchases and sales of assets such as stocks, bonds and land.

Money coming in (+), or leaving ():


+ Exports Imports Increase of owned assets abroad + Increase of foreign-owned assets in the country

An account may show a surplus or a deficit. For example, a trade surplus implies that a country's exports are higher than its imports and hence there is a net flow of money into the country. A trade deficit, on the other hand, implies that the country's imports exceed its exports and hence there is a net flow of money out of the country. For a country to have a zero balance of payments, a current account deficit must be balanced by a capital account surplus. The US have been running a negative current account for a long while, which is financed through a positive financial account. The only way to buy more than you sell is to borrow money. A country will have a negative balance of payments (i.e., there is to be a net flow of money out of the country) if the net of the current account and the capital account is a deficit. Similarly, there will be a positive balance of payments (i.e., a net flow of money into a country) if the net of the current and the capital account results in a surplus.

History
Historically these flows simply were not carefully measured, and the flow proceeded in many commodities and currencies without restriction, clearing being a matter of judgement by individual banks and the governments that licensed them to operate. Mercantilism was a theory that took special notice of the balance in payments and sought simply to monopolize gold, in part to keep it out of the hands of potential military 10

opponents (a large "war chest" being a prerequisite to start a war, whereupon much trade would be embargoed). As mercantilism gave way to classical economics, these crude systems were later regulated in the 19th century by the gold standard which linked central banks by a convention to redeem "hard currency" in gold. After World War II this system was replaced by the Bretton Woods institutions (the International Monetary Fund and Bank for International Settlements) which pegged currency of participating nations to the US dollar, which was redeemable nominally in gold. In the 1970s this redemption ceased, leaving the system without a formal base. Some consider the system today to be based on oil, a universally desirable commodity due to the dependence of so much infrastructural capital on oil supply. Since OPEC prices oil in US dollars, the US dollar remains a reserve currency, but is increasingly challenged by the euro, and to some degree the Japanese yen.

United States balance


Period ending
Exports of goods and services and income receipts (+)

Balance of payments (millions of dollars) 1960 1970 1980 1990 2000 Current account
30,556 68,387 344,440 706,975 1,421,429

2003

Imports of goods and services and 23,670 59,901 333,774 759,290 1,779,188 1,778,117 income payments () Unilateral current transfers, net Capital account transactions, net 4,062 6,156 8,349 26,654 55,684 67,439

Capital account
... ... ... 6,579 809 3,079

Financial account
U.S.-owned assets abroad, net 4,099 8,470 85,815 81,234 (increase/financial outflow ()) Foreign-owned assets in the United States, net (increase/financial inflow (+)) 569,798 283,414

2,294

6,359

62,612 141,571 1,046,896

829,173

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Net

1,019

219 20,886 25,211

62,846

12,012

The term current account usually refers to the current account of the balance of payments (BOP) and contains the import and export items of goods and services as well as transfer payments including net investment income. The current account is often presented alongside the capital account and financial account of the BOP which contains data about short and long-term capital flows. Long-term capital flows are also known as foreign direct investment (FDI). Often, the capital account and the financial account are both referred to as the capital account. The BOP balances by means of a balaning account which allows for changes in official reserve assets. When it is talked about most, the current account will be either in large surplus (export receipts exceeding import payments) or substantial deficit (import payments exceeding export receipts). Generally it is a significant current account deficit (rather than a surplus) that is perceived to be a problem requiring action, but the current (trading) and capital (largely financial) accounts are inter-related and a persistent capital surplus can (by raising the exchange rate above the level it would otherwise reach) cause a current account deficit. If action to address a substantial current account deficit is taken, then the more obvious measures to consider include:

encouraging depreciation of the exchange rate (e.g. by cutting interest rates or by currency intervention of one kind or another) import restrictions, quotas or duties (though the reduction in imports caused by these measures, by appreciating the domestic currency, may be offset by a reduction in exports, with the net result being little or no change in the current account balance). measures to promote exports e.g. encouraging arms sales abroad (though these measures may also result in an increase in imports due to an appreciated domestic currency).

Less obvious but more effective methods to reduce a current account deficit include measures that increase domestic savings (or reduced domestic borrowing), including a reduction in borrowing by the national government. It should be noted that a Current Account deficit is not always a problem. The "Pitchford Thesis" state that a current account deficit does not matter if it is driven by the private sector. This theory has held true particularly for the Australian economy which is always in deficit, yet has experienced economic growth for the past 14 years (91-05).

Key drivers of the current account


The items in the current account (e.g. perhaps especially imports and exports of goods) are sensitive to international price differentials (the differences between the prices of

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goods in different countries), to the rise and decline of industries (e.g the emergence of the Japanese automobile industry 20 years ago, and the decline of the US steel industry at the same time), and to differential economic growth rates (e.g. with a country being likely to experience a deteriorating current account balance if its economy is growing more rapidly than other countries). The theory of purchasing power parity deals with the relationships between price levels (and changes of price levels) in competing countries, and is relevant in any discussion of the stability and likely trajectory of a current account balance, because the price pressures that may be operating will find their expression primarily (though not exclusively) in the traded goods area (within the current account).

Structural influences on the BOP and the current account


Countries can experience structural features or trends in their BOP's that will influence the current account. For example, the USA in recent years has enjoyed large capital account surpluses that may, depending on your beliefs about the key drivers of the US BOP, have caused the large current account deficits. Again the rise of China as a global competitor has caused a large bi-lateral deficit between the USA and China (i.e. China selling to the USA more than it buys from her) and this is likely a structural feature of trade between the two countries that will persist for years to come. Finally, some countries (e.g Malaysia and at times much of South East Asia) have been perceived as attractive locations for direct investment; they have had corresponding capital account surpluses, and resultant tendencies to experience trade and current account deficits or increase in foreign reserves. The capital account is one of two primary components of the balance of payments. It tracks the movement of funds for investments and loans into and out of a country. The capital account is the net result of public and private international investment flowing in and out of a country. This includes foreign direct investment, plus changes in holdings of stocks, bonds, loans, bank accounts, and currencies. The capital account only keeps track of the money being transferred (i.e., the worth of stocks is not taken into account as money when calculating figures for the capital account). Hence, a surplus in the capital account amounts to debtor status. Along with transactions pertaining to non-financial and non-produced assets, the capital account may also include debt forgiveness, the transfer of goods and financial assets by migrants leaving or entering a country, the transfer of ownership on fixed assets, the transfer of funds received to the sale or acquisition of fixed assets, gift and inheritance taxes, death levies, patents, copyrights, royalties, and uninsured damage to fixed assets.

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Business Communication in Foreign Languages


INTERNATIONAL STATISTICS Prof. Liviu-Stelian BEGU, PhD

PART.4 ANALYSIS OF POVERTY


Definitions:
Absolute poverty thresholds vs. relative poverty thresholds --- As explained by a National Academy of Sciences panel, Absolute thresholds are fixed at a point in time and updated solely for price changes. In contrast, relative thresholds, as commonly defined, are developed by reference to the actual expenditures (or income) of the population. Annual poverty rate --- percent of people who were in poverty in a calendar year. Annual poverty rates from the Current Population Survey and the decennial census long form are based on income reported at an annual figure. In the Survey of Income and Program Participation (SIPP), income is reported a few months at a time, several times a year. Therefore, in the SIPP, annual poverty rates are calculated using the sum of family income over the year divided by the sum of poverty thresholds that can change from month to month if ones family composition changes. Average monthly poverty --- Average percent of people poor per month in each year of a longitudinal survey panel. Chronic or long-term poverty --- Percent of people in poverty every month for the duration of a longitudinal survey panel (typically 3 to 4 years).

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Cross-sectional survey data --- Data from a survey in which a new group of respondents is sampled for each interview, instead of following the same group of respondents over time. The Current Population Survey Annual Social and Economic Supplement (CPS ASEC), the American Community Survey (ACS), and the decennial census long form are cross-sectional surveys. Entrance rate --- Percent of people who were not in poverty during the first year of a Longitudinal survey. but were in poverty in a subsequent year. Uses an annual poverty measure. Episodic poverty --- Percent of people who were poor in 2 or more consecutive months in a given time period. Episodic poverty can only be computed using Longitudinal survey data. Equivalence scale --- the numerical relationship by which poverty thresholds vary for families of different sizes and compositions. Exit rate --- Percent of people who were in poverty during the first year of a Longitudinal survey but were not in poverty in a subsequent year. Uses an annual poverty measure. Federal Poverty Level (FPL) --- According to the Department of Health and Human Services, The poverty guidelines are sometimes loosely referred to as the federal poverty level (FPL), but that phrase is ambiguous and should be avoided, especially in situations (e.g., legislative or administrative) where precision is important. Gini ratio --- The Gini ratio (or index of income concentration) is a statistical measure of income equality ranging from 0 to 1. A measure of 1 indicates perfect inequality; i.e., one person has all the income and rest have none. A measure of 0 indicates perfect equality; i.e., all people have equal shares of income. The Census Bureau used grouped data to compute all Gini ratios. Income deficit / income surplus --- Income deficit is the number of dollars that the income of a family in poverty (or unrelated individual) falls below its poverty threshold. If income is negative, the deficit equals the threshold. Income surplus is the difference in dollars between the income of a family or unrelated individual above the poverty level and its poverty threshold. Income surplus --- Income surplus is the difference in dollars between the income of a family or unrelated individual above the poverty level and its poverty threshold. Longitudinal survey data --- Data from a survey in which the same respondents are interviewed multiple times, using the same set of questions, over a period of time (a panel). The Survey of Income and Program Participation (SIPP) is a longitudinal survey. While cross-sectional data have been compared to "snapshots" in that differences between two cross-sectional estimates are based on two different samples of people,

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longitudinal data instead allow the analyst to observe how the status of the same group of people changes over time--for instance, by observing the average number of months a person falls below the poverty level, or by observing the demographic characteristics of people who enter and leave poverty. In that sense, longitudinal data have been compared to "videos."

Median income --- Median income is the amount which divides the income distribution into two equal groups, half having incomes above the median, half having incomes below the median. The medians for households, families, and unrelated individuals are based on all households, families, and unrelated individuals, respectively. The medians for people are based on people 15 years old and over with income. National Academy of Sciences (NAS) panel --- The National Research Councils Panel on Poverty and Family Assistance: Concepts, Information Needs, and Measurement Methods. --- A group of scholars who co-authored a publication in 1995, that recommended alternative methods for measuring poverty. The Census Bureau has conducted research to refine some of the panel's measurement methods and to examine how its recommendations would affect the number in poverty and the poverty rate. Poverty areas --- Poverty areas are census tracts or block numbering areas (BNA's) where at least 20 percent of residents were below the poverty level. Poverty definition --- Following the Office of Management and Budget's (OMB) Statistical Policy Directive 14, the Census Bureau uses a set of money income thresholds that vary by family size and composition to determine who is in poverty. If a familys total income is less than the familys threshold, then that family and every individual in it is considered in poverty. The official poverty thresholds do not vary geographically, but they are updated for inflation using Consumer Price Index (CPI-U). The official poverty definition uses money income before taxes and does not include capital gains or noncash benefits (such as public housing, Medicaid, and food stamps). Poverty in the past 12 months --- The American Community Survey measures poverty in the previous 12 months instead of the previous calendar year. Poverty rate --- The percentage of people (or families) who are below poverty. Poverty spell --- Number of months in poverty as measured using panel data from a longitudinal survey (excluding spells underway in the first interview month of the panel). Miminum spell length is 2 months. Spells are separated by 2 or more months of not being in poverty. Individuals can have more than one spell. Poverty thresholds --- Dollar amounts the Census Bureau uses to determine a family's or person's poverty status. Poverty universe --- Persons for whom the Census Bureau can determine poverty status (either "in poverty" or "not in poverty"). For some persons, such as unrelated individuals

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under age 15, poverty status is not defined. Since Census Bureau surveys typically ask income questions to persons age 15 or older, if a child under age 15 is not related by birth, marriage, or adoption to a reference person within the household, we do not know the child's income and therefore cannot determine his or her poverty status. For the decennial censuses and the American Community Survey, poverty status is also undefined for people living in college dormitories and in institutional group quarters. People whose poverty status is undefined are excluded from Census Bureau poverty tabulations. Thus, the total population in poverty tables--the poverty universe--is slightly smaller than the overall population.

Ratio of income to poverty --- People and families are classified as being in poverty if their income is less than their poverty threshold. If their income is less than half their poverty threshold, they are below 50% of poverty; less than the threshold itself, they are in poverty (below 100% of poverty); less than 1.25 times the threshold, below 125% of poverty, and so on. The greater the ratio of income to poverty, the more people fall under the category, because higher ratios include more people with higher incomes. Small Area Income and Poverty Estimates --- The Small Area Income and Poverty Estimates (SAIPE) program produces estimates of income and poverty for states and counties, and population and poverty for school districts. The estimates are provided for the administration of federal programs and the allocation of federal funds to local jurisdictions. Standard error --- A measure of an estimate's variability. The greater the standard error in relation to the size of the estimate, the less reliable the estimate. Unrelated individual --- Unrelated individuals are people of any age who are not members of families or subfamilies. Working poor --- The Census Bureau does not use the term "working poor." The "working poor" may mean different things to different data users, based on the question they are trying to answer, such as:
-People who worked, but who, nevertheless, fell under the official definition of poverty. -People who were in poverty and had at least one working family member. Table includes the children and other family members of workers (such as stay-at-home parents, retired family members, and others). -People who may not necessarily be "in poverty" according to the official measure of poverty, but who fall below some percentage of the poverty level (for instance, 200 percent of poverty). -Percentages of the poverty level are referred to as "Ratio of income to poverty"" in our Detailed Poverty Tables.

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-"Below 100% of poverty" is the same as "in poverty." -"Below 200% of poverty" includes all those described as "in poverty" under the official definition, plus some people who have income above poverty but less than 2 times their poverty threshold.

Poverty Status
The poverty status data were derived from questionnaire items 41 and 42, the same questions used to derive the income data. (For more information, see the discussion under "Income.") Poverty statistics presented in American Community Survey publications adhere to the standards defined by the Office of Management and Budget in Directive 14. The Social Security Administration (SSA) developed the original poverty definition in 1964, which federal interagency committees subsequently revised in 1969 and 1980. The Office of Management and Budget's (OMB) Directive 14 prescribes this definition as the official poverty measure for federal agencies to use in their statistical work.

Derivation of the Current Poverty Measure


When the SSA created the poverty definition in 1964, it focused on family food consumption. The U.S. Department of Agriculture (USDA) used its data about the nutritional needs of children and adults to construct food plans for families. Within each food plan, dollar amounts varied according to the total number of people in the family and the family's composition; that is, the number of children within each family. The cheapest of these plans, the Economy Food Plan, was designed to address the dietary needs of families on an austere budget. Since the USDA's 1955 Food Consumption Survey showed that families of three or more people across all income levels spent roughly one-third of their income on food, the SSA multiplied the cost of the Economy Food Plan by three to obtain dollar figures for total family income. These dollar figures, with some adjustments, later became the official poverty thresholds. Since the Economy Food Plan budgets varied by family size and composition, so too did the poverty thresholds. For two person families, the thresholds were adjusted by slightly higher factors because those households had higher fixed costs. Thresholds for unrelated individuals were calculated as a fixed proportion of the corresponding thresholds for two person families. The poverty thresholds are revised annually to allow for changes in the cost of living as reflected in the Consumer Price Index (CPI-U). The poverty thresholds are the same for all parts of the country; they are not adjusted for regional, state or local variations in the cost of living. For a detailed discussion of the poverty definition, see U.S. Census Bureau, Current Population Reports, Series P-60, No. 210, Poverty in the United States: 1999.

How the Census Bureau Determines Poverty Status

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In determining the poverty status of families and unrelated individuals, the Census Bureau uses thresholds (income cutoffs) arranged in a two-dimensional matrix. The matrix consists of family size (from one person to nine or more people) cross-classified by presence and number of family members under 18 years old (from no children present to eight or more children present). Unrelated individuals and two-person families are further differentiated by age of reference person (RP) (under 65 years old and 65 years old and over). To determine a person's poverty status, one compares the person's total family income in the last twelve months with the poverty threshold appropriate for that person's family size and composition (see example below). If the total income of that person's family is less than the threshold appropriate for that family, then the person is considered poor or "below the poverty level", together with every member of his or her family. If a person is not living with anyone related by birth, marriage, or adoption, then the person's own income is compared with his or her poverty threshold. The total number of people below the poverty level was the sum of people in families and the number of unrelated individuals with incomes in the last twelve months below the poverty level. Since ACS respondents are interviewed throughout the year and asked about their income in the last twelve months, the appropriate threshold for a given family or individual person is determined by the threshold from the base year (1982) multiplied by the average of all the twelve monthly poverty factors (converted CPI-U) preceding the interview month. For example, consider a family of three with one child under 18 years of age, which was interviewed in the month of July 2002 and reported a total income of $12,000 for the last 12 months - from July 2001 to June 2002. In order to determine the poverty status of this family we need; 1) the threshold for the 1982 base year for family size three with one child under 18 years of age which is $7,765 (see poverty threshold table below) 2) the average poverty factor for the twelve months starting from July 2001 to June 2002. Which is 1.84622 (see the 2002 poverty factors below) 3) the product of the above ($7,765 X 1.84622) which is $14,336 is the appropriate threshold for family of three with one child under 18 years of age. Thus comparing the threshold $14,336 against the familys annual income $12,000 reveals that this family (all members of the family) is considered to have an annual income which is below the poverty level in 2002.

The 2002 Poverty factors:


Months January February March Poverty Factors 1.83463 1.83639 1.83812

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April May June July August September October November December

1.84028 1.84279 1.84460 1.84622 1.84850 1.85121 1.85354 1.85671 1.86011

Poverty Thresholds in 1982, by Size of Family and Number of Children Under 18 Years (Dollars)
Size of family unit Weighted average None thresholds One person (unrelated individual) Under 65 years 65 years and over Two persons Householder under 65 years Householder 65 years and over Three persons Four persons Five persons Six persons Seven persons Eight persons or more Nine persons or more $$4,901 5,019 4,626 6,281 6,487 5,836 7,693 9,862 6,459 5,831 7,546 6,649 6,624 7,765 7,772 9,783 9,817 5,019 4,626 One Related children under 18 years Two Three Four Five Six Seven Eight or more

9,950 10,112

11,684 11,999 12,173 11,801 11,512 11,336 13,207 13,801 13,855 13,570 13,296 12,890 12,649 15,036 15,879 15,979 15,637 15,399 14,955 14,437 13,869 16,719 17,760 17,917 17,594 17,312 16,911 16,403 15,872 15,738 19,698 21,364 21,468 21,183 20,943 20,549 20,008 19,517 19,397 18,649

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Business Communication in Foreign Languages


INTERNATIONAL STATISTICS Prof. Liviu-Stelian BEGU, PhD

PART.5 MOBILITY OF POPULATION


Definitions and Explanations
The definitions and explanations found in reports in the Current Population Reports series issued by the Census Bureau are largely drawn from various technical and procedural materials used in the collection of data in the Current Population Survey. The concepts defined below generally refer to current definitions. For reports based on earlier surveys, especially those published before 1990, the user should consult the printed reports for those years. As reports and surveys continue to evolve, definitions may also alter to accommodate these changes. We will alert users to significant changes in the concepts presented in the reports released on the Internet to enable them to accurately interpret the data for historical comparisons.

Birth cohort. A birth cohort is a group of people who were born in a specified calendar period. Births, Out of wedlock. Out-of-wedlock births are defined as births occurring in the 12-month period preceding the survey date to women who were currently divorced, widowed, or never married at the time of the interview. Child Support. Data on award of child support payments were collected from people 15 years or older with children under 21 years of age whose other parent was not living in the household. Information on recipiency and amount of payments was obtained from
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people who reported that they were awarded or had agreements to receive child support payments.

Reason for nonaward of child support.


Final agreement pending: A child support agreement was awaiting final court, magisterial, or legal action before becoming final, and/or a voluntary written agreement was not yet final. Joint custody granted: Housing, care, and support of the child(ren) was shared by both parents; therefore, no money or other support was exchanged. Did not want child support: The custodial parent indicated he/she did not want child support for own child(ren). Unable to locate other parent: Child support was desired, but the child(ren)s noncustodial parent could not be located. Unable to establish paternity: Child support arrangements could not be made because the child(ren)s paternity could not be established. Some other reason: The custodial parent wanted child support, and the reason for nonaward did not fit any of the reasons listed above.

Inclusion of health insurance in child support award.


This item refers to whether the child(ren)s noncustodial parent had made health insurance arrangements for his/her child(ren) as part of the child support award. Arrangements for health insurance could have been made by the noncustodial parent purchasing a separate policy for the child(ren) or including the child(ren) under the health insurance provided by his/her employer. In either event, the purchase of, or inclusion of, health insurance must be part of the child support agreement. Insurance taken out by the custodial parent but paid for from child support payment by the noncustodial parent is not included.

Type of child support arrangement.


Voluntary written agreement: Voluntary written agreements between the parties. This agreement may or may not have been recognized by the courts as part of the divorce or separation proceedings. This type of agreement was not ordered by the courts. Court ordered: Payments ordered by the court. Court-ordered payments usually take place when a mutually acceptable agreement cannot be worked out between the parties.

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Other: Arrangements not within either of the two cases above. This category includes informal verbal agreements.

Children. The term "children," as used in tables on living arrangements of children under 18, are all persons under 18 years, excluding people who maintain households, families, or subfamilies as a reference person or spouse. Own children in a family are sons and daughters, including stepchildren and adopted children, of the householder. Similarly, "own" children in a subfamily are sons and daughters of the married couple or parent in the subfamily. (All children shown as members of related subfamilies are own children of the person(s) maintaining the subfamily.) For each type of family unit identified in the CPS, the count of "own children under 18 years old" is limited to never-married children; however, "own children under 25" and "own children of any age," as the terms are used here, include all children regardless of marital status. The counts include never-married children living away from home in college dormitories. Related children in a family include own children and all other children under 18 years old in the household who are related to the householder by birth, marriage, or adoption. The count of related children in families was formerly restricted to never-married children. However, beginning with data for 1968 the Bureau of the Census includes ever-married children under the category of related children. This change added approximately 20,000 children to the category of related children in March 1968. Children ever born. The question "How many babies has...ever had, if any? (Do not count stillbirths)" is asked of all women 15 to 44 years old. When asking about children ever born, interviewers are instructed to include children born to the women before her present marriage, children no longer living, and children away from home as well as children who are still living in the home. It is possible that some never-married mothers living with one or more of their natural children reported themselves as having been married. In addition, many mothers who first married after the birth of one or more children counted those children, as they were expected to do. Nevertheless, data are probably less complete for births out of wedlock than for births within marriage. College enrollment. The college enrollment statistics are based on replies to the interviewers inquiry as to whether the person was attending or enrolled in school and the grade or school or year of college. Interviewers were instructed to count as enrolled anyone who had been enrolled at any time during the current term or school year, except those who have left for the remainder of the term. Thus, regular college enrollment includes those people attending a 4-year or 2-year college, university, or professional school (such as medical or law school) in courses that may

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advance the student toward a recognized college or university degree (e.g., BA or MA). Attendance may be either full time or part time, during the day or night. The college student need not be working toward a degree, but he/she must be enrolled in a class for which credit would be applied toward a degree. (see "school enrollment"). Students are classified by year of college, based on the academic year (not calendar year) they are attending. Undergraduate years are the 1st through 4th year, or freshman through senior. Graduate or professional school years include the 5th year and higher. Two-year and four-year colleges: College students were asked to report whether the college in which they were enrolled was a 2-year college (junior or community college) or a 4-year college or university. Students enrolled in the first 4 years (undergraduates) were classified by the type of college they reported. Graduate students are shown as a separate group. Attendance, full-time and part-time. College students were classified according to whether they were attending school on a full-time or part-time basis. A student was regarded as attending college full time if he/she was taking 12 or more hours of classes during the average school week, and part time if he/she was taking less than 12 hours of classes during the average school week.

Citizenship status. There are five categories of citizenship status: 1) Born in the United States; 2) Born in Puerto Rico or another outlying area of the U.S.; 3) Born abroad of U.S. citizen parents; 4) Naturalized citizens; 5) Non-citizens. Place of birth was asked for every household member in the CPS sample, and for the parents of every household member. People born in the U.S. or its outlying areas, or whose parents were born in the U.S. or its outlying areas, were not asked citizenship questions. Citizenship status (1), (2), or (3) was assigned during the editing phase of data preparation based on the place of birth of the household member, or the place of birth of his or her parents. People born outside the U.S. and its outlying areas, and whose parents were born outside the U.S. and its outlying areas, were asked, "Are you a citizen of the United States." Yes answers were assigned to the naturalized citizen category (4) and No answers were assigned to the "Not a citizen" category (5) during the editing process. People for whom no birthplace was provided were assigned a citizenship status during the editing process. For example, the citizenship status of a child might have been assigned based on the citizenship status of its mother. Country of birth. Birth place codes available in the CPS include; one code for the United States (fifty states and Washington DC); one code for Puerto Rico; one code for all other outlying areas of the United States (American Samoa, Guam, U.S. Virgin Islands, Northern Marinas, etc.); separate codes for 100 individual foreign countries or areas; residual codes for other cases (At Sea, etc.). People for whom no birthplace was provided were assigned a birthplace during the editing process based on

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several criteria. For example, the birthplace of a child might have been assigned based on the birthplace of its mother and/or father. Country of birth and Year of entry. People born outside the United States (see Country of Birth) were asked the year they came to the United States to live. Persons in citizenship categories (2) to (5) (see Citizenship Status) for whom no year of entry was reported were assigned a value for "Year of Entry" during the editing process based on other reported information. Educational attainment. Data on educational attainment are derived from a single question that asks, "What is the highest grade of school...has completed, or the highest degree...has received?" The single educational attainment question now in use was introduced in the CPS beginning January 1992, and is similar to that used in the 1990 Decennial Census of Population and Housing. Consequently, data on educational attainment from the 1992 CPS are not directly comparable to CPS data from earlier years. The new question replaces the previous two-part question used in the CPS that asked respondents to report the highest grade they had attended, and whether or not they had completed that grade. The questions on educational attainment apply only to progress in "regular" schools. Such schools include graded public, private, and parochial elementary and high schools (both junior and senior high schools), colleges, universities, and professional schools, whether day schools or night schools. Thus, regular schooling is that which may advance a person toward an elementary school certificate or high school diploma, or a college, university, or professional school degree. Schooling in other than regular schools was counted only if the credits obtained are regarded as transferable to a school in the regular school system.

Ethnic origin. People of Hispanic origin were identified by a question that asked for selfidentification of the persons origin or descent. Respondents were asked to select their origin (and the origin of other household members) from a "flash card" listing ethnic origins. People of Hispanic origin, in particular, were those who indicated that their origin was Mexican, Puerto Rican, Cuban, Central or South American, or some other Hispanic origin. It should be noted that people of Hispanic origin may be of any race.
People who were Non-Hispanic White origin, were identified by crossing the responses to two self-identification questions: (1) origin or descent and (2) race. Respondents were asked to select their race (and the race of other household members) from a "flash card" listing racial groups. Beginning with March 1989, the population is divided into five groups on the basis of race: White, Black, American Indian, Eskimo or Aleut, Asian or Pacific Islander, and Other races.

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The last category includes any other race except the four mentioned. Respondents who selected their race as White and indicated that their origin was not one of the Hispanic origin subgroups Mexican, Puerto Rican, Cuban, Central or South American, were called Non-Hispanic White origin.

Family. A family is a group of two people or more (one of whom is the householder) related by birth, marriage, or adoption and residing together; all such people (including related subfamily members) are considered as members of one family. Beginning with the 1980 Current Population Survey, unrelated subfamilies (referred to in the past as secondary families) are no longer included in the count of families, nor are the members of unrelated subfamilies included in the count of family members. The number of families is equal to the number of family households, however, the count of family members differs from the count of family household members because family household members include any nonrelatives living in the household. Family group. A family group is any two or more people (not necessarily including a householder) residing together, and related by birth, marriage, or adoption. A household may be composed of one such group, more than one, or none at all. The count of family groups includes family households, related subfamilies, and unrelated subfamilies. Family household. A family household is a household maintained by a householder who is in a family (as defined above), and includes any unrelated people (unrelated subfamily members and/or secondary individuals) who may be residing there. The number of family households is equal to the number of families. The count of family household members differs from the count of family members, however, in that the family household members include all people living in the household, whereas family members include only the householder and his/her relatives. See the definition of family. Group quarters. As of 1983, group quarters were defined in the current population survey as noninstitutional living arrangements for groups not living in conventional housing units or groups living in housing units containing ten or more unrelated people or nine or more people unrelated to the person in charge. (Prior to 1983, group quarters included housing units containing five or more people unrelated to the person in charge.) Examples of people in group quarters include a person residing in a rooming house, in staff quarters at a hospital, or in a halfway house. Beginning in 1972, inmates of institutions have not been included in the Current Population Survey. Head Start.

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Children enrolled in Head Start programs or similar programs sponsored by local agencies to provide preschool education to young children are counted under nursery school or kindergarten as appropriate. Health Insurance Coverage. A person was considered covered by health insurance at some time during the year if he or she was covered by at least one of the following types of coverages: 1. 2. 3. 4. 5. Employer/union Privately purchased (not related to employment) Medicare Medicaid Military health care (military, CHAMPUS, CHAMPVA, VA, Indian Health Services) 6. Someone outside the household 7. Other An individual can have more than one type of coverage during the year. Household. A household consists of all the people who occupy a housing unit. A house, an apartment or other group of rooms, or a single room, is regarded as a housing unit when it is occupied or intended for occupancy as separate living quarters; that is, when the occupants do not live and eat with any other persons in the structure and there is direct access from the outside or through a common hall. A household includes the related family members and all the unrelated people, if any, such as lodgers, foster children, wards, or employees who share the housing unit. A person living alone in a housing unit, or a group of unrelated people sharing a housing unit such as partners or roomers, is also counted as a household. The count of households excludes group quarters. There are two major categories of households, "family" and "nonfamily".

Household, family, or subfamily, Size of. The term "size of household" includes all the people occupying a housing unit. "Size of family" includes the family householder and all other people in the living quarters who are related to the householder by birth, marriage, or adoption. "Size of related subfamily" includes the husband and wife or the lone parent and their never-married sons and daughters under 18 years of age. "Size of unrelated subfamily" includes the reference person and all other members related to the reference person. If a family has a related subfamily among its members, the size of the family includes the members of the related subfamily. Household, nonfamily. A nonfamily household consists of a householder living alone (a one-person household) or where the householder shares the home exclusively with people to whom he/she is not related.

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Householder. The householder refers to the person (or one of the people) in whose name the housing unit is owned or rented (maintained) or, if there is no such person, any adult member, excluding roomers, boarders, or paid employees. If the house is owned or rented jointly by a married couple, the householder may be either the husband or the wife. The person designated as the householder is the "reference person" to whom the relationship of all other household members, if any, is recorded.
The number of householders is equal to the number of households. Also, the number of family householders is equal to the number of families.

Head versus householder. Beginning with the 1980 CPS, the Bureau of the Census discontinued the use of the terms "head of household" and "head of family." Instead, the terms "householder" and "family householder" are used. Recent social changes have resulted in greater sharing of household responsibilities among the adult members and, therefore, have made the term "head" increasingly inappropriate in the analysis of household and family data. Specifically, beginning in 1980, the Census Bureau discontinued its longtime practice of always classifying the husband as the reference person (head) when he and his wife are living together. Income measurement: For each person in the sample 15 years old and over, the CPS asks questions on the amount of money income received in the preceding calendar year from each of the following sources:
1. Earnings 2. Unemployment compensation 3. Workers compensation 4. Social security 5. Supplemental security income 6. Public assistance 7. Veterans payments 8. Survivor benefits 9. Disability benefits 10. Pension or retirement income 11. Interest 12. Dividends 13. Rents, royalties, and estates and trusts 14. Educational assistance 15. Alimony 16. Child support 17. Financial assistance from outside of the household 18. Other income

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It should be noted that although the income statistics refer to receipts during the preceding calendar year, the demographic characteristics, such as age, labor force status, and family or household composition, are as of the survey date. The income of the family/household does not include amounts received by people who were members during all or part of the income year if these people no longer resided in the family/household at the time of interview. However, the CPS collects income data for people who are current residents but did not reside in the household during the income year. Data on consumer income collected in the CPS by the Census Bureau cover money income received (exclusive of certain money receipts such as capital gains) before payments for personal income taxes, social security, union dues, medicare deductions, etc. Therefore, money income does not reflect the fact that some families receive part of their income in the form of noncash benefits, such as food stamps, health benefits, rent-free housing, and goods produced and consumed on the farm. In addition, money income does not reflect the fact that noncash benefits are also received by some nonfarm residents which often take the form of the use of business transportation and facilities, full or partial payments by business for retirement programs, medical and educational expenses, etc. Data users should consider these elements when comparing income levels. Moreover, readers should be aware that for many different reasons there is a tendency in household surveys for respondents to underreport their income. Based on an analysis of independently derived income estimates, the Census Bureau determined that respondents report income earned from wages or salaries much better than other sources of income and that the reported wage and salary income is nearly equal to independent estimates of aggregate income. The Census Bureau collects data for the following income sources: 1. Earnings. The Census Bureau classifies earnings from longest job (or self-employment) and other employment earnings into three types: a. Money wage or salary income is the total income people receive for work performed as an employee during the income year. This category includes wages, salary, armed forces pay, commissions, tips, piece-rate payments, and cash bonuses earned, before deductions are made for items such as taxes, bonds, pensions, and union dues. b. Net income from nonfarm self-employment is the net money income (gross receipts minus expenses) from ones own business, professional enterprise, or partnership. Gross receipts include the value of all goods sold and services rendered. Expenses include items such as costs of goods purchased, rent, heat, power, depreciation charges, wages and salaries paid, and business taxes (not personal income taxes). In general, the Census Bureau considers inventory changes in determining net income from nonfarm self-employment; replies based on income tax returns or

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2.

3. 4.

5.

6.

7.

other official records do reflect inventory changes. However, when respondents do not report values of inventory changes, interviewers will accept net income figures exclusive of inventory changes. The Census Bureau does not include the value of saleable merchandise consumed by the proprietors of retail stores as part of net income. c. Net income from farm self-employment is the net money income (gross receipts minus operating expenses) from the operation of a farm by a person on their own account, as an owner, renter, or sharecropper. Gross receipts include the value of all products sold, payments from government farm programs, money received from the rental of farm equipment to others, rent received from farm property if payment is made based on a percent of crops produced, and incidental receipts from the sale of items such as wood, sand, and gravel. Operating expenses include items such as cost of feed, fertilizer, seed, and other farming supplies; cash wages paid to farmhands; depreciation charges; cash rent; interest on farm mortgages; farm building repairs; and farm taxes (not state and federal personal income taxes). The Census Bureau does not include the value of fuel, food, or other farm products used for family living as part of net income. In determining farm selfemployment income, the Census Bureau considers inventory changes in determining net income only when they are accounted for in replies based on income tax returns or other official records which reflect inventory changes; otherwise, the Census Bureau does not take inventory changes into account. Unemployment compensation includes payments the respondent received from government unemployment agencies or private companies during periods of unemployment and any strike benefits the respondent received from union funds. Workers compensation includes payments people receive periodically from public or private insurance companies for injuries received at work. Social security includes social security pensions and survivors benefits and permanent disability insurance payments made by the Social Security Administration prior to deductions for medical insurance. The Census Bureau does not include medicare reimbursements for health services as social security benefits. Supplemental security income includes federal, state, and local welfare agency payments to low-income people who are 65 years old and over or people of any age who are blind or disabled. Public assistance or welfare payments include cash public assistance payments low-income people receive, such as aid to families with dependent children (AFDC, ADC), temporary assistance to needy families (TANF), general assistance, and emergency assistance. Veterans payments include payments disabled members of the armed forces or survivors of deceased veterans receive periodically from the

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Department of Veterans Affairs for education and on-the-job training, and means-tested assistance to veterans. 8. Survivor benefits include payments people receive from survivors or widows pensions, estates, trusts, annuities, or any other types of survivor benefits. Respondents can report payments from ten different sources: private companies or unions; federal government (Civil Service); military; state or local governments; railroad retirement; workers compensation; Black lung payments; estates and trusts; annuities or paid-up insurance policies; and other survivor payments. 9. Disability benefits include payments people receive as a result of a health problem or disability (other than those from social security). Respondents can report payments from ten sources: workers compensation; companies or unions; federal government (Civil Service); military; state or local governments; railroad retirement; accident or disability insurance; Black lung payments; state temporary sickness; or other disability payments. 10. Pension or retirement income includes payments people receive from eight sources: companies or unions; federal government (Civil Service); military; state or local governments; railroad retirement; annuities or paidup insurance policies; individual retirement accounts (IRAs), Keogh, or 401(k) payments; or other retirement income. 11. Interest income includes payments people receive (or have credited to accounts) from bonds, treasury notes, IRAs, certificates of deposit, interest-bearing savings and checking accounts, and all other investments that pay interest. 12. Dividends include income people receive from stock holdings and mutual fund shares. The CPS does not include capital gains from the sale of stock holdings as income. 13. Rents, royalties, and estates and trusts include net income people receive from the rental of a house, store, or other property, receipts from boarders or lodgers, net royalty income, and periodic payments from estate or trust funds. 14. Educational assistance includes Pell Grants; other government educational assistance; any scholarships or grants; or financial assistance students receive from employers, friends, or relatives not residing in the students household. 15. Alimony includes all periodic payments people receive from ex-spouses. Alimony excludes one-time property settlements. 16. Child support includes all periodic payments a parent receives from an absent parent for the support of children, even if these payments are made through a state or local government office. 17. Financial assistance from outside of the household includes periodic payments people receive from nonhousehold members. This type of assistance excludes gifts or sporadic assistance. 18. Other income includes all other payments people receive regularly that are not included elsewhere on the questionnaire. Some examples are state

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programs such as foster child payments, military family allotments, and income received from foreign government pensions. 19. Government transfers include payments people receive from the following sources: (1) unemployment compensation, (2) state workers compensation, (3) social security, (4) Supplemental Security Income (SSI), (5) public assistance, (6) veterans benefits, (7) government survivor benefits, (8) government disability benefits, (9) government pensions, and (10) government educational assistance. The Census Bureau does not count the following receipts as income: (1) capital gains people received (or losses they incur) from the sale of property, including stocks, bonds, a house, or a car (unless the person was engaged in the business of selling such property, in which case the CPS counts the net proceeds as income from self-employment); (2) withdrawals of bank deposits; (3) money borrowed; (4) tax refunds; (5) gifts; and (6) lump-sum inheritances or insurance payments. The Census Bureau combines all sources of income into two major types: 1. Total money earnings is the algebraic sum of money wages and salary and net income from farm and nonfarm self-employment. 2. Income other than earnings is the algebraic sum of all sources of money income except wages and salaries and income from self-employment.

Alternative Measures of income


1. Money income excluding capital gains before taxes. This is the official definition used in Census Bureau reports. a. Money income after taxes (without earned income credit (EIC)). This is definition 1 minus federal and state income taxes exclusive of the EIC, minus payroll taxes, plus capital gains, and minus capital losses. b. Money income after taxes (including EIC). This is definition 1a plus the EIC. 2. Definition 1 less government cash transfers. Government cash transfers include nonmeans-tested transfers such as social security payments, unemployment compensation, and government educational assistance (e.g., Pell Grants), as well as means-tested transfers such as aid to families with dependent children (AFDC, ADC), temporary assistance to needy families (TANF), and supplemental security income (SSI). (For a complete listing of transfer income, see definitions 9 and 12.) 3. Definition 2 plus capital gains. Realized capital gains and losses are simulated as part of the Census Bureaus federal individual income tax estimation procedure.

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4. Definition 3 plus imputed health insurance supplements to wage and salary income. Employer-paid health insurance coverage is treated as part of total work compensation. 5. Definition 4 less payroll taxes. Payroll taxes are payments for social security old age, survivors, and disability insurance, and for hospital insurance (medicare). 6. Definition 5 less federal income taxes. Definition 7 shows the effect of the earned income credit (targeted to low-income workers) separately. 7. Definition 6 plus the earned income credit. 8. Definition 7 less state income taxes. 9. Definition 8 plus nonmeans-tested government cash transfers. Nonmeanstested government cash transfers include social security payments, unemployment compensation, workers compensation, nonmeans-tested veterans payments, U.S. railroad retirement, Black lung payments, Pell Grants, and other government educational assistance. (Pell Grants are income-tested but are included here because they are very different from the assistance programs included in the means-tested category.) 10. Definition 9 plus the value of medicare. Medicare is counted at its fungible value.1 11. Definition 10 plus the value of regular-price school lunches. 12. Definition 11 plus means-tested government cash transfers. Means-tested government cash transfers include AFDC, ADC, TANF, SSI, other public assistance programs, and means-tested veterans payments. 13. Definition 12 plus the value of medicaid. This definition counts medicaid at its fungible value. 14. Definition 13 plus the value of other means-tested government noncash transfers, including food stamps, rent subsidies, and free and reducedprice school lunches. 15. Definition 14 less medical programs. This is cash income plus all noncash income except imputed income from own home, minus the fungible values of medicaid and medicare. 16. Definition 14 plus net imputed return on equity in ones own home. This definition includes the estimated annual benefit of converting ones home equity into an annuity, net of property taxes.

The fungible approach for valuing medical coverage assigns income to the extent that having the insurance would free up resources that would have been spent on medical care. The estimated fungible value depends on family income, the cost of food and housing needs, and the market value of the medical benefits. If family income is not sufficient to cover the familys basic food and housing requirements, the fungible value methodology treats medicare and medicaid as having no income value. If family income exceeds the cost of food and housing requirements, the fungible value of medicare and medicaid is equal to the amount which exceeds the value assigned for food and housing requirements (up to the

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amount of the market value of an equivalent insurance policy (total cost divided by the number of participants in each rish class)). Income-to-poverty ratios. Income-to-poverty ratios represent the ratio of family or unrelated individual income to their appropriate poverty threshold. Ratios below 1.00 indicate that the income for the respective family or unrelated individual is below the official definition of poverty, while a ratio of 1.00 or greater indicates income above the poverty level. A ratio of 1.25, for example, indicates that income was 125 percent above the appropriate poverty threshold.

Gini ratio. The Gini ratio (or index of income concentration) is a statistical measure of income equality ranging from 0 to 1. A measure of 1 indicates perfect inequality; i.e., one person has all the income and rest have none. A measure of 0 indicates perfect equality; i.e., all people have equal shares of income. The Census Bureau used grouped data to compute all Gini ratios. Marital status. The marital status classification identifies four major categories: never married, married, widowed, and divorced. These terms refer to the marital status at the time of the enumeration.
The category "married" is further divided into "married, spouse present," "separated," and "other married, spouse absent." A person was classified as "married, spouse present" if the husband or wife was reported as a member of the household, even though he or she may have been temporarily absent on business or on vacation, visiting, in a hospital, etc., at the time of the enumeration. People reported as separated included those with legal separations, those living apart with intentions of obtaining a divorce, and other people permanently or temporarily separated because of marital discord. The group "other married, spouse absent" includes married people living apart because either the husband or wife was employed and living at a considerable distance from home, was serving away from home in the Armed Forces, had moved to another area, or had a different place of residence for any other reason except separation as defined above.

Single, when used as a marital status category, is the sum of never-married, widowed, and divorced people. "Single," when used in the context of "singleparent family/household," means only one parent is present in the home. The parent may be never-married, widowed, divorced, or married, spouse absent. Marriage cohort. A marriage cohort is a group of women who were first married in a specified calendar period,regardless of any subsequent changes in marital status. Marriage, Age at first. The estimated median age at first marriage, is an approximation derived indirectly from tabulations of marital status and age. In computing this median, several steps
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are involved. First, the expected proportion of young people who will ever marry during their lifetime is computed. Second, one-half of this expected proportion is calculated. And third, the current age of young people who are at this halfway mark is computed. From the assumptions made and the procedures used, it follows that the date of the survey is also the date when this halfway mark is reached. Half of the young people of the given age who will ever get married had done so prior to the survey date and half are expected to marry in years to come. Married couple. A married couple, as defined for census purposes, is a husband and wife enumerated as members of the same household. The married couple may or may not have children living with them. The expression "husband-wife" or "marriedcouple" before the term "household," "family," or "subfamily" indicates that the household, family, or subfamily is maintained by a husband and wife. The number of married couples equals the count of married-couple families plus related and unrelated married-couple subfamilies. Mean (Average) income. Mean (average) income is the amount obtained by dividing the total aggregate income of a group by the number of units in that group. The means for households, families, and unrelated individuals are based on all households, families, and unrelated individuals, respectively. The means (averages) for people are based on people 15 years old and over with income. Median income. Median income is the amount which divides the income distribution into two equal groups, half having incomes above the median, half having incomes below the median. The medians for households, families, and unrelated individuals are based on all households, families, and unrelated individuals, respectively. The medians for people are based on people 15 years old and over with income. Metropolitan-nonmetropolitan residence. The general concept of a metropolitan area (MA) is one of a large population nucleus, together with adjacent communities that have a high degree of economic and social integration with that nucleus. Some MAs are defined around two or more nuclei. The MA classification is a statistical standard, developed for use by Federal agencies in the production, analysis, and publication of data on MAs. The MAs are designated and defined by the Federal Office of Management and Budget, following a set of official published standards. These standards were developed by the interagency Federal Executive Committee on Metropolitan Areas, with the aim of producing definitions that are as consistent as possible for all MAs nationwide. Each MA must contain either a place with a minimum population of 50,000 or a Census Bureau-defined urbanized area and a total MA population of at least 100,000 (75,000 in New England). An MA is comprised of one or more central counties, and an MA may also include one or more outlying counties that have 35

closed economic and social relationships with the central county. An outlying county must have a specified level of commuting to the central counties and also must meet certain standards regarding metropolitan character, such as population density, urban population, and population growth. In New England, MAs are composed of cities and towns rather than whole counties. The territory, population, and housing units in MAs are referred to as "metropolitan." The metropolitan category is subdivided into "inside central city" and "outside central city." The territory, population, and housing units located outside MAs are referred to as "nonmetropolitan." To meet the needs of various users, the standards provide for a flexible structure of metropolitan definitions that classify an MA either as a metropolitan statistical area (MSA) or as a consolidated metropolitan statistical area (CMSA) that is divided into primary metropolitan statistical areas (PMSAs). Documentation of the MA standards and how they are applied is available from the Secretary, Federal Executive Committee on Metropolitan Areas, Population Division, U.S. Bureau of the Census, Washington, DC 20233.

Central city. In each MSA and CMSA, the largest place and, in some cases, additional places are designated as "central cities" under the official standards. A few PMSAs do not have central cities. The largest central city and, in some cases, up to two additional central cities are included in the title of the MA; there are also central cities that are not included in an MA title. An MA central city does not include any part of that city that extends outside the MA boundary. Consolidated and primary metropolitan statistical area. If an area that qualifies as an MA has more than one million people, primary metropolitan statistical areas (PMSAs) may be defined within it. PMSAs consist of a large urbanized county or cluster of counties that demonstrates very strong internal economic and social links, in addition to close ties to other portions of the larger area. When PMSAs are established, the larger area of which they are component parts is designated a consolidated metropolitan statistical area (CMSA). Metropolitan statistical area. Metropolitan statistical areas are relatively freestanding MAs and are not closely associated with other MAs. These areas are typically surrounded by nonmetropolitan counties. Migration, allocations of data. In the March CPS, complete mobility information is usually not reported for about 10 percent of all people. In these cases, people missing mobility data are assigned the mobility status and previous residence obtained for other family members or allocated using the data for another sample person who did respond to the questions. The mobility status and previous residence allocated to a nonrespondent is that obtained for another person with similar demographic characteristics who has been selected systematically in the order in which

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individual records are processed. Characteristics used in these allocations (when assignment of data for other family members is not possible) are age, race, years of school completed, and metropolitan status and state of current residence. State of previous residence is used instead of state of current residence if the individual being allocated data reported state of previous residence but not city or county. Migration universe. The mobility data are derived from the answers to questions on residence 1 year before the survey date and the geographical location of the respondents current residence. These questions were asked for all members of the survey household who were 1 year old and over on the survey date. Mobility status. The population was classified according to mobility status on the basis of a comparison between the place of residence of each individual to the time of the March survey and the place of residence 1 year earlier. Nonmovers are all people who were living in the same house at the end of the migration period and the beginning of the migration period. Movers are all people who were living in a different house at the end of the period rather than at the beginning. Movers are further classified as to whether they were living in the same or different county, state, region, or were movers from abroad. Movers are also categorized by whether they moved within or between central cities, suburbs, and nonmetropolitan areas of the United States. Moving, Reasons for. Reasons for moving were collected from the householder and other persons, 1 year old and over, who were living in a different house/apartment 1 year prior to the March survey. Persons who moved with the householder were assigned the reason of the householder.

Reasons for moving.

Change in marital status: Person moved because of family formation or dissolution resulting in a change in marital status classification to one of the following categories: married, widowed, separated or divorced. To establish own household: People who moved out of an existing household in order to establish a separate one. Other family reason: All other reasons not listed above that are family related. New job or job transfer: People who moved because of a new job or location of existing job moved. This also included military transfers. To look for work or lost job: People who move in order to find work. To be closer to work/easier commute: People who move to be closer to their work and/or cut their commuting time. Retired: People who, after retirement from a job, have changed their place of residence. Other job related reason: All other reasons not listed above that are job related.

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Wanted to own home/not rent: People who wanted to own their own home and not rent a house or apartment. Wanted a new or better house/apartment: People who wanted to move from their current home/apartment to a new, bigger/better house/apartment. Wanted better neighborhood/less crime: People who wanted to move to a better neighborhood and or a neighborhood with less crime. Wanted cheaper housing: People who moved to cheaper/less expensive house/apartment. Other housing reason: All other reasons not listed above that are housing related. To attend/leave college: People who leave a place of residence to attend college or who leave college to return to previous place of residence or move elsewhere. Change of climate: People who moved to a better climate. Health reasons: Any change of residence based on the health of the individual or another person. Other reason: All other reasons not listed.

Native born. Native born people are citizens at birth. All other people are foreign born. Parity. Parity is the number of children ever born to a woman. In some cases, use of the term "parity" provides a less cumbersome expression, e.g., "two-parity women" as opposed to "women with two children ever born." Poverty definition. Following the Office of Management and Budgets (OMBs) Directive 14, the Census Bureau uses a set of money income thresholds that vary by family size and composition to detect who is poor. If a familys total income is less than that familys threshold, then that family, and every individual in it, is considered poor. The poverty thresholds do not vary geographically, but they are updated annually for inflation with the Consumer Price Index (CPI-U). The official poverty definition counts money income before taxes and excludes capital gains and noncash benefits (such as public housing, medicaid, and food stamps).
Poverty statistics are based on a definition developed by Mollie Orshansky of the Social Security Administration (SSA)in 19642 and revised in 1969 and 1981 by interagency committees. This definition was established as the official definition of poverty for statistical use in all Executive departments by the Bureau of the Budget (BoB) in 1969 (in Circular No. A-46); after BoB became The Office of Management and Budget, this was reconfirmed in Statistical Policy Directive No. 14. The original poverty definition provided a range of income cutoffs or thresholds adjusted by such factors as family size, sex of the family head, number of children

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under 18 years old, and farm-nonfarm residence. At the core of this definition of poverty was the economy food plan, the least costly of four nutritionally adequate food plans designed by the Department of Agriculture. It was determined from the Department of Agricultures 1955 Household Food Consumption Survey that families of three or more people spent approximately one-third of their after-tax money income on food; accordingly, poverty thresholds for families of three or more people were set at three times the cost of the economy food plan. Different procedures were used to calculate poverty thresholds for two-person families and people living alone in order to compensate for the relatively larger fixed expenses of these smaller units. For two-person families, the cost of the economy food plan was multiplied by a factor of 3.7 (also derived from the 1955 survey). For unrelated individuals (one-person units), no multiplier was used; poverty thresholds were instead calculated as a fixed proportion of the corresponding thresholds for two-person units. Annual updates of these SSA poverty thresholds were based on price changes of the items in the economy food plan. As a result of deliberations of a Federal interagency committee in 1969, the following two modifications to the original SSA definition of poverty were adopted3: 1. The SSA thresholds for nonfarm families were retained for the base year 1963, but annual adjustments in the levels were based on changes in the Consumer Price Index (CPI) rather than on changes in the cost of foods in the economy food plan. 2. The farm thresholds were raised from 70 to 85 percent of the corresponding nonfarm levels. The combined impact of these two modifications resulted in an increase in the tabulated totals for 1967 of 360,000 poor families and 1.6 million poor people. In 1981, three additional modifications in the poverty definition recommended by another interagency committee were adopted for implementation in the March 1982 CPS as well as the 1980 census: 1. Elimination of separate thresholds for farm families. 2. Elimination (by averaging) of separate thresholds for female-householder families and "all other" families (earlier termed "male-headed" families). 3. Extension of the detailed poverty threshold matrix to make the largest family size category "nine people or more". For further details, see the section, "Changes in the Definition of Poverty," in Current Population Reports, Series P-60, No. 133. The poverty thresholds are increased each year by the same percentage as the annual average Consumer Price Index (CPI). The poverty thresholds are currently adjusted using the annual average CPI-U (1982-84 = 100). This base year has been used since 1988. From 1980 through 1987, the thresholds were adjusted 39

using the CPI-U (1967 = 100). The CPI (1963 = 100) was used to adjust thresholds prior to 1980. For further information on how the poverty thresholds were developed and subsequent changes in them, see Gordon M. Fisher, "The Development and History of the Poverty Thresholds," Social Security Bulletin, vol.55, no.4, Winter 1992, pp. 3-14.
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For a detailed discussion of the original SSA poverty thresholds, see Mollie Orshansky, Counting the Poor: Another Look at the Poverty Profile, Social Security Bulletin, vol. 28, no. 1, January 1965, pp. 3-29 (reprinted in Social Security Bulletin, vol. 51, no. 10, October 1988, pp. 25-51); and Whos Who Among the Poor: A Demographic View of Poverty, Social Security Bulletin, vol. 28, no. 7, July 1965, pp. 3-32. Poverty thresholds for 1959-1967 were recalculated on this basis, and revised poverty population figures for those years were tabulated using the revised thresholds. These revised 1959-1967 poverty population figures have been published in Census Bureau reports issued since August 1969 (including the present report). Because of this revision, poverty statistics from documents dated before August 1969 are not comparable with current poverty statistics.
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Race.
The race of individuals was identified by a question that asked for selfidentification of the persons race. Respondents were asked to select their race from a "flashcard" listing racial groups. Reference person. The reference person is the person to whom the relationship of other people in the household is recorded. The household reference person is the person listed as the householder. The subfamily reference person is either the single parent or the husband/wife in a married-couple situation. Rounding. Percentages are rounded to the nearest tenth of a percent; therefore, the percentages in a distribution do not always add to exactly 100.0 percent. School, dropout rate, annual high school. The annual high school dropout rate is an estimate of the proportion of students who drop out of school in a single year. This section briefly explains how the annual dropout rate is calculated. Annual dropout rates for a single grade (x) are estimated as the ratio of the number of people who were enrolled in grade (x) in the year preceding the survey and who did not complete grade (x) and are not currently enrolled, to the number enrolled in grade (x) at the start of the year preceding this survey. People reported as enrolled last year but not currently enrolled are presented in table 8 of Current 40

Population Reports on school enrollment, by the highest grade completed and are presumed to have dropped out of the succeeding grade (except those who graduated this year). Thus, individuals counted as 10th grade dropouts are those not enrolled in school whose highest grade completed is the 9th grade. (They include not only those people who were enrolled in the 10th grade in the fall of the year preceding the survey and left school without completing the year, but also those people who finished the 9th grade in the spring preceding the survey and were not enrolled at the survey date.) These estimates form the numerator of estimates of the annual grade specific dropout rate. People currently enrolled in high school are presumed to have successfully completed and been enrolled in the preceding grade in the preceding year. Thus, those who have successfully completed the 10th grade are enrolled in the 11th grade. Along with the people who dropped out of that grade, they comprise the denominator of the estimate of the annual grade-specific dropout rate. Not enrolled and highest grade completed ------------------------------------------------------------Dropout grade n = from Enrolled in grade n+1 + = n-1

Not enrolled and highest grade completed = n-1

Since people who complete the 12th grade cannot be presumed to enroll in college, the estimate of the number of people enrolled in the 12th grade one year prior to the survey is constructed as the sum of the number of people reported as having graduated from high school "this year" (both those enrolled in the first year of college and people not currently enrolled whose highest grade completed is the 12th grade) and those people not currently enrolled who were enrolled last year and whose highest grade completed is the 11th grade (dropouts). The annual dropout rate for all grades during one year can be obtained by summing the components of the rates for the individual grades. In other words, those people who were enrolled in the tenth, eleventh, or twelfth grade last year and who are not currently enrolled and do not have a diploma. In addition to the annual rate, two other estimates of dropouts are frequently used. The annual dropout rate is different from a "pool" (or status) measure such as the proportion of an age group who are high school dropouts (not enrolled in school, not high school graduates, which does not depend on when the individuals dropped out. A third measure of dropouts is the cohort measure, most commonly from a longitudinal study, in which one calculates the proportion of a specific group of people enrolled in a specific year, who had not received diplomas (and who were no longer in school) some years later. For example, the proportion of a cohort enrolled in ninth grade in year X, who were not enrolled and had not received a diploma by year X=4.

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School enrollment. The school enrollment statistics from the CPS are based on replies to the interviewers inquiry whether the person was enrolled in regular school. Interviewers were instructed to count as enrolled anyone who had been enrolled at any time during the current term or school year in any type of public, parochial, or other private school in the regular school system. Such schools include nursery schools, kindergartens, elementary schools, high schools, colleges, universities, and professional schools. Attendance may be on either a full-time, or part-time basis and during the day or night. Regular schooling is that which may advance a person toward an elementary or high school diploma, a college, university, or professional school degree. Children enrolled in nursery schools and kindergarten are included in the enrollment figures for regular schools and are also shown separately.
Enrollment in schools which are not in the regular school system, such as trade schools, business colleges, and schools for the mentally handicapped, which do not advance students to regular school degrees, is not included. People enrolled in classes which do not require physical presence in school, such as correspondence courses or other courses of independent study, and in training courses given directly on the job, are also excluded from the count of those enrolled in school, unless such courses are being counted for credit at a regular school. School enrollment in year preceding current survey: An inquiry on enrollment in regular school or college in October of the preceding year was asked for all people (enrolled and not enrolled). In years before 1988, the question was asked only of people who were not currently attending regular school or were enrolled in college. In the tabulations of people enrolled in secondary school in the previous year, people currently enrolled in high school were assumed to have been enrolled the previous year. Comparability of enrollment data in previous years: Changes in the edit and tabulation packages used in processing the October CPS school enrollment supplement caused some minor revisions in the estimates. The current edit and tabulation package began with 1987 data. The 1986 data which were published in Current Population Report, Series P-20 No. 429, were reprocessed with the rewritten programs in order to clarify comparability. Time series tables usually show only the revised estimates for 1986. The previous edit and tabulation package was used from 1967 to 1986. Major changes in the data due to the 1987 edit revisions were: (1) Among 14- and 15-year-olds, an edit improvement allowed people with enrollment data not reported, who were previously automatically imputed "not enrolled," to be enrolled; (2) Revisions in tabulation of enrollment in the previous year simplifies calculation of an annual high school dropout rate; (3) Edit improvements caused

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increases in college enrollment estimates, most notably above age 24; this age group was largely ignored in earlier edits; (4) Type of college is fully allocated (discussed earlier); (5) Tabulations of type of college (2-year,4-year) are available by race; (6) Dependent family member is defined consistently; (7) New tabulations of employment status, vocational course enrollment, college retention and re-entry, and families with children enrolled in public and private school were available beginning in 1987. In the series of reports on school enrollment for 1987 to 1992, race and Hispanic origin were erroneously tabulated for a small percentage of children 3 to 14 years old. Race and Hispanic origin of an adult in the household were attributed to the child, rather than using the childs reported characteristics. In the vast majority of cases these characteristics were the same for family members, but for a small percentage of children, they were different. The correction made the following proportional changes in the numbers of children in each group: White (-0.5 percent), Black (+3.1 percent), Hispanic origin (-4.6 percent). Published data on enrollment from the October CPS for 1981 to 1993 used population controls based on the 1980 census. Beginning in 1994 estimates were based on 1990 census population controls, including adjustment for undercount. Time series tables show two sets of data for 1993; the data labeled 1993r were processed using population controls based on the 1990 census, adjusted for undercount. The change in 1994 from a paper and pencil survey to a computer assisted survey had some affect on the data. Most notable, the enrollment question for children 3 to 5 years old was different from the question for older children--it included a reference to nursery school. In 1994 reported nursery school enrollment was significantly higher than in earlier years.

School, Level of: The statistics on level of school indicate the number of people enrolled at each of five levels--nursery school, kindergarten, elementary school (1st to 8th grades), high school (9th to 12th grades), and college or professional school. The last group includes graduate students in colleges or universities. People enrolled in elementary, middle school, intermediate school or junior high school through the eighth grade are classified as in elementary school. All people enrolled in 9th through 12th grade are classified as in high school. School, Modal grade. Enrolled people are classified according to their relative progress in school: that is, whether the grade or year in which they were enrolled was below, at, or above the modal (or typical) grade for people of their age at the time of the survey. The modal grade is the year of school in which the largest proportion of students of a given age is enrolled. School, Nursery. A nursery school is defined as a group or class that is organized to provide educational experiences for children during the year or years preceding

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kindergarten. It includes instruction as an important and integral phase of its program of child care. Private homes in which essentially custodial care is provided are not considered nursery schools. Children attending nursery school are classified as attending during either part of the day or the full day. Part-day attendance refers to those who attend either in the morning or in the afternoon, but not both. Full-day attendance refers to those who attend in both the morning and the afternoon. Children enrolled in Head Start programs or similar programs sponsored by local agencies to provide preschool education to young children are counted under nursery school. School, Public or private. In this report, a public school is defined as any educational institution operated by publicly elected or appointed school officials and supported by public funds. Private schools include educational institutions established and operated by religious bodies, as well as those which are under other private control. In cases where enrollment was in a school or college which was both publicly and privately controlled or supported, enrollment was counted according to whether it was primarily public or private. Secondary individuals. Secondary individuals are people of any age who reside in a household, but are not related to the householder (except unrelated subfamily members). People who reside in group quarters are also secondary individuals. Examples of a secondary individual include (1) a guest, partner, roommate, or resident employee; (2) a foster child; or (3) a person residing in a rooming house, a halfway house, staff quarters at a hospital, or other type of group quarters. Step family. A Step family is a married-couple family household with at least one child under age 18 who is a stepchild (i.e., a son or daughter through marriage, but not by birth) of the householder. This definition undercounts the true number of step families in instances where the parent of the natural born or biological child is the householder and that parents spouse is not the childs parent, as biological or stepparentage is not ascertained in the CPS for both parents. Subfamily. A subfamily is a married couple with or without children, or a single parent with one or more own never-married children under 18 years old. A subfamily does not maintain their own household, but lives in the home of someone else.

Related subfamily. A related subfamily is a married couple with or without children, or one parent with one or more own never married children under 18 years old, living in a household and related to, but not including, the person or couple who maintains the household. One example of a related subfamily is a young married couple sharing the home of the husbands or wifes parents. The number of related subfamilies is not included in the count of families. Unrelated subfamily. An unrelated subfamily (formerly called a secondary family) is a married couple with or without children, or a single parent with one or
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more own never-married children under 18 years old living in a household. Unrelated subfamily members are not related to the householder. An unrelated subfamily may include people such as guests, partners, roommates, or resident employees and their spouses and/or children. The number of unrelated subfamily members is included in the total number of household members, but is not included in the count of family members. Beginning in 1989, any person(s) who is not related to the householder and who is not the husband, wife, parent, or child in an unrelated subfamily is counted as an unrelated individual.

Tenure. A housing unit is "owned" if the owner or co-owner lives in the unit, even if it is mortgaged or not fully paid for. A cooperative or condominium unit is "owned" only if the owner or co-owner lives in it. All other occupied units are classified as "rented," including units rented for cash rent and those occupied without payment of cash rent. Undocumented immigrants or illegal aliens. Because all residents of the United States living in households are represented in the sample of households interviewed by the CPS, undocumented immigrants or illegal aliens are probably included in CPS data. Because the CPS makes no attempt to ascertain the legal status of any person interviwed, these individuals cannot be identified from CPS data. Units in structure. In the determination of the number of units in a structure, all housing units, both occupied and vacant, were counted. The statistics are presented in terms of the number of occupied housing units in structures of specified size, not in terms of the number of residential structures. Unmarried couple. An unmarried couple is composed of two unrelated adults of the opposite sex (one of whom is the householder) who share a housing unit with or without the presence of children under 15 years old. Unmarried couple households contain only two adults. Unrelated individuals. Unrelated individuals are people of any age who are not members of families or subfamilies. Vocational school enrollment. Vocational school enrollment includes enrollment in business, vocational, technical, secretarial, trade, or correspondence courses which are not counted as regular school enrollment and are not for recreation or adult education classes. Courses counted as college enrollment should not also be included as vocational. Voting, people eligible to register.

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The population of voting age includes a considerable number of people who meet the age requirement but cannot register and vote. People who are not citizens are not eligible to vote. Among citizens of voting age, some people are not permitted to vote because they have been committed to penal institutions, mental hospitals, or other institutions, or because they fail to meet state and local resident requirements for various reasons. The eligibility to register is governed by state laws which differ in many respects. Registration is the act of qualifying to vote by formally enrolling on a list of voters. People who have moved to another election district must take steps to have their names placed on the voting rolls in their new place of residence. In a few states or parts of states, no formal registration is required. Voters merely present themselves at the polling place on election day with proof that they are of age and have met the appropriate residence requirements. Therefore, in these areas people who are citizens and of voting age, and who meet the residence requirement, would be considered as being registered.

Voter, reported participation. Voter participation data are derived from replies to the following question asked of people (excluding noncitizens) of voting age: "In any election some people are not able to vote because they are sick or busy, or have some other reason, and others do not want to vote. Did (this person) vote in the election held on November (date varies)?"
Those of voting age were classified as "voted" or "did not vote." In most tables, this "did not vote" class includes those reported as "did not vote," "do not know," noncitizens, and nonrespondents. Nonrespondents and people who reported that they did not know if they voted were included in the "did not vote" class because of the general over-reporting by respondents in the sample.

Voter, reported registration. The data on registration were obtained by tabulating replies to the following question for those people included in the category "did not vote." "Was (this person) registered to vote in the November (date varies) election?"
All people reported as having voted were assumed to have been registered. Therefore, the total registered population is obtained by combining the number of people who voted and people included in the category "did not vote," but who had registered.

Voted, time of day. Data on time of day and method of voting was obtained in various November Current Population Surveys from replies to a direct question: "At what time of day did... vote?" The answer was recorded in one of the following categories:

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Before noon Noon to 4 p.m. 4 p.m. to 6 p.m. After 6 p.m. Voted absentee Dont know Work Experience A person with work experience is one who, during the preceding calendar year, did any work for pay or profit or worked without pay on a family-operated farm or business at any time during the year, on a part-time or full-time basis. A fulltime worker is one who worked 35 hours or more per week during a majority of the weeks worked during the preceding calendar year. A year-round worker is one who worked for 50 weeks or more during the preceding calendar year. A fulltime, year-round worker is a person who worked full time (35 or more hours per week) and 50 or more weeks during the previous calendar year.

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