Until the advent of SIPP, the major source of data on income and program participation was the Current Population Survey (CPS) March Income Supplement. The CPS continues to be the source of all official income and poverty statistics published by the Census Bureau. The CPS, however, is designed primarily to obtain information on employment. Because income measurement was never the primary purpose of the CPS, it has certain gaps in this area. For example, CPS respondents are asked in March to recall their income during the preceding calendar year. Many respondents have difficulty in remembering sources such as property income or irregular income over the yearlong reference period. Also, the CPS does not capture the impact of changes in household composition during the year, nor does the survey explicitly measure periods of program participation. Further, the CPS does not collect data on assets and liabilities, which are needed to measure more completely a household.s economic status and eligibility for program benefits. To add those items to the CPS questionnaire would dilute the main purpose of that survey and unduly increase respondent burden. Finally, the CPS is designed to be a cross-sectional survey. During the 1970s, the increasing size of government programs and their interactions with the labor market led to a need for longitudinal data.
To address those data issues, the Department of Health, Education, and Welfare (HEW) initiated the Income Survey Development Program (ISDP) in the late 1970s. In developing ISDP content and procedures, HEW focused on questionnaire length, length of reference period, and linkage of survey data to program records. The 1979 ISDP Panel was a longitudinal survey in which respondents were asked about their income, labor force participation, and other characteristics; repondents were recontacted every 3 months to supply information on themselves and others with whom they resided; the 3-month span was the reference period for the interview.
The lessons learned from ISDP were incorporated into the initial design of SIPP, which was used for the first 10 years of the survey. The original design of SIPP called for a nationally representative sample of individuals 15 years of age and older to be selected in households in the civilian noninstitutionalized population. Those individuals, along with others who subsequently lived with them, were to be interviewed once every 4 months over a 32-month period. To ease field procedures and spread the work evenly over the 4-month reference period for the interviewers, the Census Bureau randomly divided each panel into four rotation groups. Each rotation group was interviewed in a separate month. Four rotation groups thus constituted one cycle, called a wave, of interviewing for the entire panel (Chapter 2 of the SIPP User's Guide). At each interview, respondents were asked to provide information covering the 4 months since the previous interview. The 4-month span was the reference period for the interview. The first sample, the 1984 Panel, began interviews in October 1983 with sample members in 19,878 households. The second sample, the 1985 Panel, began in February 1985. Subsequent panels began in February of each calendar year, resulting in concurrent administration of the survey in multiple panels.
The original goal was to have each panel cover eight waves. However, a number of panels were terminated early (Chapter 2) because of insufficient funding. For example, the 1988 Panel had six waves; the 1989 Panel, part of which was folded into the 1990 Panel, was halted after three waves. In addition, the intent was for each SIPP panel to have an initial sample size of 20,000 households. That target was rarely achieved; again, budget issues were usually the reason. The 1996 redesign (discussed below) entailed a number of important changes. First, the 1996 Panel spans 4 years and encompasses 12 waves. The redesign has abandoned the overlapping panel structure of the earlier SIPP, but sample size has been substantially increased: the 1996 Panel had an initial sample size of 40,188 households (Chapter 2 of the SIPP User's Guide).
In 1990, the Census Bureau asked the Committee on National Statistics (CNSTAT) at the National Research Council to undertake a comprehensive review of SIPP. The resulting report, The Future of the Survey of Income and Program Participation (Citro and Kalton, 1993), summarizes the first 9 years of SIPP and provides recommendations for the future of the survey. Some of those recommendations were implemented with the 1996 SIPP Panel in what is known as the 1996 redesign.
One of the goals of the 1996 redesign was to improve the quality of longitudinal estimates in order to provide better information for policy makers. Specific changes include the following:
The first interviews of the redesigned SIPP began in April 1996 with the 1996 Panel. Later in 1996, Congress passed the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA). That law significantly altered the nature of public transfer programs, shifting more responsibility to state governments, establishing new eligibility rules for a number of programs, and setting limits on recipiency. The existing welfare program, Aid to Families with Dependent Children (AFDC), was replaced with a new program, Temporary Assistance for Needy Families (TANF). Those changes came after interviewing for the 1996 Panel had already begun with a questionnaire designed for the array of transfer programs that existed before PRWORA was enacted. To accommodate program changes brought about by PRWORA, the Census Bureau began adapting transfer-program questions to reflect the current situation.SIPP Overview
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