The implications of differences between employer and worker employment|earnings reports for policy evaluation

Differences in administrative (UI) and survey (S) records on employment and earnings have substantial implications for assessing the impact of a variety of public interventions, such as welfare-to-work and employment training programs, and especially the state-oriented welfare reform legislation of 1996. We use data from the 1998 and 1999 waves of the Child Support Demonstration Evaluation (CSDE) Resident Parent Surveys to explore individual differences between survey and UI employment and earnings reports for a Wisconsin sample of current and former welfare recipients. After exploring the potential causes of misreports from both sources, we document the degree of discrepancy between survey and UI earnings and employment measures and assess the difference between the two earnings measures in estimates of simple human capital (earnings) functions. Last, we evaluate the correspondence of the two measures with “hardship” indicators of economic well-being.