Question

The Affordable Care Act (aka Obamacare) was signed into law in March 2010. Did it “bend the health care cost curve downward” as its supporters promised it would?

A. Social Security recipients receive annual adjustments in their benefits (COLAs) based on year-to-year changes in the CPI-W. (Actually, the Social Security annual COLA is tied to the third quarter to third quarter change from year to year, but let’s just use March to March, 2010 to 2018). Calculate the increase over that eight year period.

B. And finally, what about the average worker? For that, calculate the percent increase in compensation—using the index of hourly compensation, business sector of the economy—over the period from first quarter 2010 to first quarter 2018.

Answer 1

Monthly Social safety and Supplemental protection earnings (SSI) advantages for more than sixty six million americans will develop 2.0 percent in 2018.

The two.0 percent cost-of-dwelling adjustment (COLA) will with advantages payable to more than sixty one million Social security beneficiaries in January 2018. Extended payments to greater than eight million SSI beneficiaries will begin on December 29, 2017. (word: some humans acquire each Social security and SSI advantages)

The highest amount of earnings discipline to the Social security tax (taxable maximum) will expand to $128,400.(1)

The earnings limit for staff who're more youthful than "full" retirement age (age 66 for humans born in 1943 via 1954) will broaden to $17,040. (We deduct $1 from advantages for each and every $2 earned over $17,040.)

The profits restrict for folks turning sixty six in 2018 will increase to $forty five,360. (We deduct $1 from advantages for each and every $three earned over $forty five,360 except the month the worker turns age sixty six.)

there's no restrict on earnings for staff who are "full" retirement age or older for the whole yr.
Historical past of automatic fee-Of-residing changes (COLA)

The reason of the COLA is to make sure that the purchasing vigor of Social security and Supplemental security earnings (SSI) advantages shouldn't be eroded by means of inflation. It is founded on the percent broaden in the consumer cost Index for city Wage Earners and Clerical staff (CPI-W) from the 0.33 quarter of the last year a COLA was decided to the 1/3 quarter of the current year. If there's no develop, there can be no COLA.

The CPI-W will depend on the Bureau of Labor records within the division of Labor. By law, it is the official measure used by the Social protection Administration to calculate COLAs.

Congress enacted the COLA provision as a part of the 1972 Social protection Amendments, and automated annual COLAs started out in 1975. Before that, benefits have been multiplied most effective when Congress enacted designated legislation.

Commencing in 1975, Social protection began automatic annual rate-of-living allowances. The trade was enacted by using laws that ties COLAs to the annual expand within the CPI-W.

The alternate implies that inflation not drains worth from Social protection advantages.

2.

This system explains how EPI measures wages, hours, and compensation making use of a style of government information sources. Chiefly, EPIâs wage knowledge come from the current populace Survey (CPS), the federal government survey that's best recognized for providing the month-to-month estimates of unemployment. This document covers:

the methodology for measuring hourly wages utilizing the present population Survey Outgoing Rotation workforce (CPS ORG) and for measuring annual wages and hours worked utilizing the present population Survey Annual Social and financial supplement (CPS ASEC)
a discussion of wage knowledge from the Social security Administration (SSA)
a proof of EPIâs measurement of compensation (which involves wages and benefits) using Bureau of monetary analysis countrywide earnings and Product accounts (NIPA) tables and Bureau of Labor records countrywide Compensation Surveyâs corporation charges for employee Compensation (ECEC) knowledge
The methodology outlined here is used within the wages, wage gaps, and benefits and compensation sections of EPIâs State of Working the us data Library as well as EPI experiences that use this data.

Hourly wages
The CPS is a month-to-month family survey prepared via the U.S. Census Bureau for the Bureau of Labor statistics (BLS). Especially, for 1979 and past, we analyze microdata files that contain a full yearâs knowledge on the outgoing rotation groups (ORG) in the CPS. (For years previous to 1979, we use the CPS may just records; our use of those documents is mentioned in a while this page.) We consider that the CPS-ORG files allow for timely and correct analyses of wage trends which might be in keeping with the acquainted labor drive definitions and standards employed via BLS.

The sampling framework of the CPS is a ârolling panel,â in which households are in the survey for 4 consecutive months, out for eight, and then back in for 4 months. The ORG documents provide knowledge on those CPS respondents in both their fourth or eighth month of the survey (i.E., in businesses 4 or eight, out of a whole of eight organizations). As a result, in any given month, the ORG file represents 1 / 4 of the CPS pattern. For a given yr, the ORG file is equivalent in dimension to a few months of CPS files (one-fourth of 12 months). For our analyses, we use a pattern drawn from the full-12 months ORG pattern, the dimensions of which stages from a hundred and sixty,000 to a hundred and eighty,000 observations for the duration of the 1979 to 1995 period. As a result of a decrease in the overall sample measurement of the CPS, the ORG shrunk to a hundred forty five,000 circumstances from 1996 to 1998, and was once an ordinary of 162,000 instances from 1999 to 2014. Our most up to date sample includes about 152,000 instances.

Our subsample entails all wage and income workers with valid wage and hour knowledge, whether paid weekly or by the hour. Additionally, with a purpose to be incorporated in our subsample, respondents had to meet the next criteria:
be age 18â64
be employed in the public or exclusive sector (unincorporated self-employed were excluded)
have hours worked within the legitimate variety within the survey (1.99 per week, or âhours fluctuate see dialogue below)
have Monthly Social safety and Supplemental protection earnings (SSI) advantages for more than sixty six million americans will develop 2.0 percent in 2018.

The two.0 percent cost-of-dwelling adjustment (COLA) will with advantages payable to more than sixty one million Social security beneficiaries in January 2018. Extended payments to greater than eight million SSI beneficiaries will begin on December 29, 2017. (word: some humans acquire each Social security and SSI advantages)

The highest amount of earnings discipline to the Social security tax (taxable maximum) will expand to $128,400.(1)

The earnings limit for staff who're more youthful than "full" retirement age (age 66 for humans born in 1943 via 1954) will broaden to $17,040. (We deduct $1 from advantages for each and every $2 earned over $17,040.)

The profits restrict for folks turning sixty six in 2018 will increase to $forty five,360. (We deduct $1 from advantages for each and every $three earned over $forty five,360 except the month the worker turns age sixty six.)

there's no restrict on earnings for staff who are "full" retirement age or older for the whole yr.
Historical past of automatic fee-Of-residing changes (COLA)

The reason of the COLA is to make sure that the purchasing vigor of Social security and Supplemental security earnings (SSI) advantages shouldn't be eroded by means of inflation. It is founded on the percent broaden in the consumer cost Index for city Wage Earners and Clerical staff (CPI-W) from the 0.33 quarter of the last year a COLA was decided to the 1/3 quarter of the current year. If there's no develop, there can be no COLA.

The CPI-W will depend on the Bureau of Labor records within the division of Labor. By law, it is the official measure used by the Social protection Administration to calculate COLAs.

Congress enacted the COLA provision as a part of the 1972 Social protection Amendments, and automated annual COLAs started out in 1975. Before that, benefits have been multiplied most effective when Congress enacted designated legislation.

Commencing in 1975, Social protection began automatic annual rate-of-living allowances. The trade was enacted by using laws that ties COLAs to the annual expand within the CPI-W.

The alternate implies that inflation not drains worth from Social protection advantages.

2.

This system explains how EPI measures wages, hours, and compensation making use of a style of government information sources. Chiefly, EPIs wage knowledge come from the current populace Survey (CPS), the federal government survey that's best recognized for providing the month-to-month estimates of unemployment. This document covers:

the methodology for measuring hourly wages utilizing the present population Survey Outgoing Rotation workforce (CPS ORG) and for measuring annual wages and hours worked utilizing the present population Survey Annual Social and financial supplement (CPS ASEC)
a discussion of wage knowledge from the Social security Administration (SSA)
a proof of EPIs measurement of compensation (which involves wages and benefits) using Bureau of monetary analysis countrywide earnings and Product accounts (NIPA) tables and Bureau of Labor records countrywide Compensation Surveys corporation charges for employee Compensation (ECEC) knowledge
The methodology outlined here is used within the wages, wage gaps, and benefits and compensation sections of EPI State of Working the us data Library as well as EPI experiences that use this data.

Hourly wages
The CPS is a month-to-month family survey prepared via the U.S. Census Bureau for the Bureau of Labor statistics (BLS). Especially, for 1979 and past, we analyze microdata files that contain a full years knowledge on the outgoing rotation groups (ORG) in the CPS. (For years previous to 1979, we use the CPS may just records; our use of those documents is mentioned in a while this page.) We consider that the CPS-ORG files allow for timely and correct analyses of wage trends which might be in keeping with the acquainted labor drive definitions and standards employed via BLS.

The sampling framework of the CPS is a rolling panel,in which households are in the survey for 4 consecutive months, out for eight, and then back in for 4 months. The ORG documents provide knowledge on those CPS respondents in both their fourth or eighth month of the survey (i.E., in businesses 4 or eight, out of a whole of eight organizations). As a result, in any given month, the ORG file represents 1 / 4 of the CPS pattern. For a given yr, the ORG file is equivalent in dimension to a few months of CPS files (one-fourth of 12 months). For our analyses, we use a pattern drawn from the full-12 months ORG pattern, the dimensions of which stages from a hundred and sixty,000 to a hundred and eighty,000 observations for the duration of the 1979 to 1995 period. As a result of a decrease in the overall sample measurement of the CPS, the ORG shrunk to a hundred forty five,000 circumstances from 1996 to 1998, and was once an ordinary of 162,000 instances from 1999 to 2014. Our most up to date sample includes about 152,000 instances.

Our subsample entails all wage and income workers with valid wage and hour knowledge, whether paid weekly or by the hour. Additionally, with a purpose to be incorporated in our subsample, respondents had to meet the next criteria:
be age 18-64
be employed in the public or exclusive sector (unincorporated self-employed were excluded)
have hours worked within the legitimate variety within the survey (1.99 per week, or hours fluctuate see dialogue below)
have both hourly or weekly wages inside the legitimate survey variety (prime-coding mentioned beneath)
Exceptions to this subsample are few and incorporate the entry-degree worker pattern, which is 17- to 24-year-olds, and union insurance plan charges, which use staff age 16 or older.

For individuals who met these criteria, an hourly wage used to be calculated within the following method: If a legitimate hourly wage used to be suggested, that wage used to be used throughout our evaluation. For salaried staff (people who document only a weekly wage), the hourly wage was the weekly wage divided via the hours worked. Outliers, i.E., folks with hourly wages beneath 50 cents or above $a hundred in 1989 greenbacks (adjusted by way of the CPI-U-X1 client fee index), were eliminated from the evaluation. Commencing from 12 months 2002, we use dollars adjusted by means of the client rate Index research sequence utilizing present approaches (CPI-U-RS).
The hourly wage pronounced through hourly employees in the CPS excludes overtime, tips, or commissions (OTTC), therefore introducing a talents undercount in the hourly wage of workers who mostly receive tips or premium pay. OTTC is included in the typical weekly earnings of hourly workers, which raises the probability of assigning an imputed hourly wage to hourly workers based on the stated weekly wage and hours labored per week. Conceptually, utilizing this imputed wage is ideal to using the mentioned hourly wage considering the fact that it's more inclusive. We now have chosen, nonetheless, not to use this broader wage measure, seeing that the extra knowledge on OTTC appears unreliable. We when put next the imputed hourly wage (mentioned weekly gains divided via weekly hours) with the mentioned hourly wage; the difference possibly displays OTTC. This assessment confirmed that giant percentages of the hourly team of workers appeared to obtain poor OTTC. These error premiums range from a low of 0 percent of the hourly team of workers in 1989-1993 to a high of 16-17 percent in 1973-1988, and persist throughout the survey alternate from 1993 to 1994. Due to the fact that poor OTTC is clearly implausible, we rejected this imputed hourly wage sequence and depend strictly on the hourly rate of pay as stated straight by using hourly employees, discipline to the pattern standards discussed above.

Wage percentiles
developing wage deciles is commonly problematic through the truth that pronounced wages within the data are likely to clump,certainly round circular numbers. So, for instance, a large share of employees could report their hourly wage as $10.00 per hour, although they sincerely make $9.87 or $10.14. And, of direction, the actual wage distribution would itself be just a little clumpy meaning that an surprisingly enormous share of staff fairly might make exactly $10.00 per hour. This becomes a concern if the 10th percentile wage occurs to fall proper into the sort of clump, you will see that that extra than 10 percent of workers are earning the tenth percentile wage or less. A final drawback issues when a percentile (say the tenth) lands correct on a massive clump staff. It will make that percentile exhibit no growth for a couple of years. Again, say that many workers file a wage of $10.00, they usually accomplish that in a number of successive years even as their genuine wage alterations from (say) $9.Ninety to $10.10. If the tenth percentile landed correct on the $10.00 clump, it would seem static for years in the nominal information.

For these motives, we put into effect some smoothness within the wage knowledge to make certain that precisely 10 percentage of our sample falls at or below the tenth percentile wage (and 20 percentage falls underneath the 20th percentile and many others). The smoothing manner includes making a specific hourly wage distribution, wherein the classes are 25-cent intervals1 (also known as 25-cent bins). We then to find the bins on both facet of each and every decile and perform a weighted, linear interpolation to find the wage cutoffs for every of the targeted deciles. The weights for the interpolation are derived from differences within the cumulative percentages on either facet of the decile. For example, consider that the forty eighth percentile of the wage distribution of employees with the aid of wage degree is in the $9.51-$9.75 wage bin, and the 51st percentile is in the subsequent greater bin, $9.76-$10.00. The weight for the interpolation (on this case, the median, or 50th percentile) is (50forty eight)/ (518), or two-thirds. The interpolated median equals this weight, times the width of the bin ($.25), plus the upper certain of the previous bin ($9.75); $9.Ninety two in thiboth hourly or weekly wages inside the legitimate survey variety (prime-coding mentioned beneath)
Exceptions to this subsample are few and incorporate the entry-degree worker pattern, which is 17- to 24-year-olds, and union insurance plan charges, which use staff age 16 or older.

For individuals who met these criteria, an hourly wage used to be calculated within the following method: If a legitimate hourly wage used to be suggested, that wage used to be used throughout our evaluation. For salaried staff (people who document only a weekly wage), the hourly wage was the weekly wage divided via the hours worked. Outliers, i.E., folks with hourly wages beneath 50 cents or above $a hundred in 1989 greenbacks (adjusted by way of the CPI-U-X1 client fee index), were eliminated from the evaluation. Commencing from 12 months 2002, we use dollars adjusted by means of the client rate Index research sequence utilizing present approaches (CPI-U-RS).
The hourly wage pronounced through hourly employees in the CPS excludes overtime, tips, or commissions (OTTC), therefore introducing a talents undercount in the hourly wage of workers who mostly receive tips or premium pay. OTTC is included in the typical weekly earnings of hourly workers, which raises the probability of assigning an imputed hourly wage to hourly workers based on the stated weekly wage and hours labored per week. Conceptually, utilizing this imputed wage is ideal to using the mentioned hourly wage considering the fact that it's more inclusive. We now have chosen, nonetheless, not to use this broader wage measure, seeing that the extra knowledge on OTTC appears unreliable. We when put next the imputed hourly wage (mentioned weekly gains divided via weekly hours) with the mentioned hourly wage; the difference possibly displays OTTC. This assessment confirmed that giant percentages of the hourly team of workers appeared to obtain poor OTTC. These error premiums range from a low of 0 percent of the hourly team of workers in 1989-1993 to a high of 1617 percent in 1973-1988, and persist throughout the survey alternate from 1993 to 1994. Due to the fact that poor OTTC is clearly implausible, we rejected this imputed hourly wage sequence and depend strictly on the hourly rate of pay as stated straight by using hourly employees, discipline to the pattern standards discussed above.

Wage percentiles
developing wage deciles is commonly problematic through the truth that pronounced wages within the data are likely to clump, certainly round circular numbers. So, for instance, a large share of employees could report their hourly wage as $10.00 per hour, although they sincerely make $9.87 or $10.14. And, of direction, the actual wage distribution would itself be just a little clumpy meaning that an surprisingly enormous share of staff fairly might make exactly $10.00 per hour. This becomes a concern if the 10th percentile wage occurs to fall proper into the sort of clump, you will see that that extra than 10 percent of workers are earning the tenth percentile wage or less. A final drawback issues when a percentile (say the tenth) lands correct on a massive clump staff. It will make that percentile exhibit no growth for a couple of years. Again, say that many workers file a wage of $10.00, they usually accomplish that in a number of successive years even as their genuine wage alterations from (say) $9.Ninety to $10.10. If the tenth percentile landed correct on the $10.00 clump, it would seem static for years in the nominal information.

For these motives, we put into effect some smoothness within the wage knowledge to make certain that precisely 10 percentage of our sample falls at or below the tenth percentile wage (and 20 percentage falls underneath the 20th percentile and many others). The smoothing manner includes making a specific hourly wage distribution, wherein the classes are 25-cent intervals1 (also known as 25-cent bins). We then to find the bins on both facet of each and every decile and perform a weighted, linear interpolation to find the wage cutoffs for every of the targeted deciles. The weights for the interpolation are derived from differences within the cumulative percentages on either facet of the decile. For example, consider that the forty eighth percentile of the wage distribution of employees with the aid of wage degree is in the $9.51â#-$9.75 wage bin, and the 51st percentile is in the subsequent greater bin, $9.76-$10.00. The weight for the interpolation (on this case, the median, or 50th percentile) is (50forty eight)/ (51.48), or two-thirds. The interpolated median equals this weight, times the width of the bin ($.25), plus the upper certain of the previous bin ($9.75); $9.Ninety two in this example.