Noise Infusion as a Confidentiality Protection Measure for Graph-Based Statistics

We use the bipartite graph representation of longitudinally linked employer-employee data, and the associated projections onto the employer and employee nodes, respectively, to characterize the set of potential statistical summaries that the trusted custodian might produce. We consider noise infusion as the primary confidentiality protection method. We show that a relatively straightforward extension of the dynamic noise-infusion method used in the U.S. Census Bureau’s Quarterly Workforce Indicators can be adapted to provide the same confidentiality guarantees for the graph-based statistics: all inputs have been modified by a minimum percentage deviation (i.e., no actual respondent data are used) and, as the number of entities contributing to a particular statistic increases, the accuracy of that statistic approaches the unprotected value. Our method also ensures that the protected statistics will be identical in all releases based on the same inputs

Earnings Inequality and Mobility Trends in the United States: Nationally Representative Estimates from Longitudinally Linked Employer-Employee Data

Using earnings data from the U.S. Census Bureau, this paper analyzes the role of the employer in explaining the rise in earnings inequality in the United States. We first establish a consistent frame of analysis appropriate for administrative data used to study earnings inequality. We show that the trends in earnings inequality in the administrative data from the Longitudinal Employer-Household Dynamics Program are inconsistent with other data sources when we do not correct for the presence of misused SSNs. After this correction to the worker frame, we analyze how the earnings distribution has changed in the last decade. We present a decomposition of the year-to-year changes in the earnings distribution from 2004-2013. Even when simplifying these flows to movements between the bottom 20%, the middle 60% and the top 20% of the earnings distribution, about 20.5 million workers undergo a transition each year. Another 19.9 million move between employment and nonemployment. To understand the role of the firm in these transitions, we estimate a model for log earnings with additive fixed worker and firm effects using all jobs held by eligible workers from 2004-2013. We construct a composite log earnings firm component across all jobs for a worker in a given year and a non-firm component. We also construct a skill-type index. We show that, while the difference between working at a low- or middle-paying firm are relatively small, the gains from working at a top-paying firm are large. Specifically, the benefits of working for a high-paying firm are not only realized today, through higher earnings paid to the worker, but also persist through an increase in the probability of upward mobility. High-paying firms facilitate moving workers to the top of the earnings distribution and keeping them there

Total Error and Variability Measures with Integrated Disclosure Limitation for Quarterly Workforce Indicators and LEHD Origin Destination Employment Statistics in OnThe Map

We report results from the first comprehensive total quality evaluation of five major indicators in the U.S. Census Bureau\u27s Longitudinal Employer-Household Dynamics (LEHD) Program Quarterly Workforce Indicators (QWI): total employment, beginning-of-quarter employment, full-quarter employment, total payroll, and average monthly earnings of full-quarter employees. Beginning-of-quarter employment is also the main tabulation variable in the LEHD Origin-Destination Employment Statistics (LODES) workplace reports as displayed in OnTheMap (OTM). The evaluation is conducted by generating multiple threads of the edit and imputation models used in the LEHD Infrastructure File System. These threads conform to the Rubin (1987) multiple imputation model, with each thread or implicate being the output of formal probability models that address coverage, edit, and imputation errors. Design-based sampling variability and finite population corrections are also included in the evaluation. We derive special formulas for the Rubin total variability and its components that are consistent with the disclosure avoidance system used for QWI and LODES/OTM workplace reports. These formulas allow us to publish the complete set of detailed total quality measures for QWI and LODES. The analysis reveals that the five publication variables under study are estimated very accurately for tabulations involving at least 10 jobs. Tabulations involving three to nine jobs have quality in the range generally deemed acceptable. Tabulations involving zero, one or two jobs, which are generally suppressed in the QWI and synthesized in LODES, have substantial total variability but their publication in LODES allows the formation of larger custom aggregations, which will in general have the accuracy estimated for tabulations in the QWI based on a similar number of workers

Modeling Endogenous Mobility in Earnings Determination

We evaluate the bias from endogenous job mobility in fixed-effects estimates of worker- and firm-specific earnings heterogeneity using longitudinally linked employer-employee data from the LEHD infrastructure file system of the U.S. Census Bureau. First, we propose two new residual diagnostic tests of the assumption that mobility is exogenous to unmodeled determinants of earnings. Both tests reject exogenous mobility. We relax the exogenous mobility assumptions by modeling the evolution of the matched data as an evolving bipartite graph using a Bayesian latent class framework. Our results suggest that endogenous mobility biases estimated firm effects toward zero. To assess validity, we match our estimates of the wage components to out-of-sample estimates of revenue per worker. The corrected estimates attribute much more of the variation in revenue per worker to variation in match quality and worker quality than the uncorrected estimates

Modeling Endogenous Mobility in Wage Determination

We evaluate the bias from endogenous job mobility in fixed-effects estimates of worker- and firm-specific earnings heterogeneity using longitudinally linked employer-employee data from the LEHD infrastructure file system of the U.S. Census Bureau. First, we propose two new residual diagnostic tests of the assumption that mobility is exogenous to unmodeled determinants of earnings. Both tests reject exogenous mobility. We relax the exogenous mobility assumptions by modeling the evolution of the matched data as an evolving bipartite graph using a Bayesian latent class framework. Our results suggest that endogenous mobility biases estimated firm effects toward zero. To assess validity, we match our estimates of the wage components to out-of-sample estimates of revenue per worker. The corrected estimates attribute much more of the variation in revenue per worker to variation in match quality and worker quality than the uncorrected estimates

Noise Infusion as a Confidentiality Protection Measure for Graph-Based Statistics

We use the bipartite graph representation of longitudinally linked employer-employee data, and the associated projections onto the employer and employee nodes, respectively, to characterize the set of potential statistical summaries that the trusted custodian might produce. We consider noise infusion as the primary confidentiality protection method. We show that a relatively straightforward extension of the dynamic noise-infusion method used in the U.S. Census Bureau’s Quarterly Workforce Indicators can be adapted to provide the same confidentiality guarantees for the graph-based statistics: all inputs have been modified by a minimum percentage deviation (i.e., no actual respondent data are used) and, as the number of entities contributing to a particular statistic increases, the accuracy of that statistic approaches the unprotected value. Our method also ensures that the protected statistics will be identical in all releases based on the same inputs.We acknowledge financial support from the U.S. Census Bureau and the National Science Foundation Grants SES-9978093 and SES-0427889 to Cornell University (Cornell Institute for Social and Economic Research), the National Institute on Aging Grant R01 AG018854-01, and the Alfred P. Sloan Foundation for LEHD infrastructure support. Abowd acknowledges additional funding through NSF Grants SES- 0922005, SES-1042181, TC-1012593 and SES-1131848.Downloads for this item at https://digitalcommons.ilr.cornell.edu/ldi/25/ as of 9/11/2020: 12

Technology and the Demand for Skill:An Analysis of Within and Between Firm Differences

We estimate the effects of technology investments on the demand for skilled workers using longitudinally integrated employer-employee data from the U.S. Census Bureau's Longitudinal Employer-Household Dynamics Program infrastructure files spanning two Economic Censuses (1992 and 1997). We estimate the distribution of human capital and its observable and unobservable components within each business for each year from 1992 to 1997. We measure technology using variables from the Annual Survey of Manufactures and the Business Expenditures Survey (services, wholesale and retail trade), both administered during the 1992 Economic Census. Static and partial adjustment models are fit. There is a strong positive empirical relationship between advanced technology and skill in a cross-sectional analysis of businesses in both sectors. The more comprehensive measures of skill reveal that advanced technology interacts with each component of skill quite differently: firms that use advanced technology are more likely to use high-ability workers, but less likely to use high-experience workers. These results hold even when we control for unobservable heterogeneity by means of a selection correction and by using a partial adjustment specification.