What proportion of US wage and salary earners are paid more than $100,000 per year? SalaryRank uses US Social Security Medicare Wage data to estimate the answer.
Social Security data gives a good estimate of the relative rank of an individual salary, compared to all other salaries. It overcomes two drawbacks associated with using IRS tax data:
The difference between household taxable income and individual labor income is substantial. The Economic Policy Institute reports that to be in the top 1 percent nationally in 2015, a family (household) needed an income of $421,926. SalaryRank shows that an individual salary is in the top 1 percent if its $280,367 or more. The difference represents multiple earners per household and non-labor income such as interest, dividends, and capital gains.
Social Security Online reports the distribution of wage earners by net compensation for each year since 1990. The report shows the number of wage earners and cumulative compensation by net compensation interval, in buckets ranging from $0.01 to $4999.99 up to $50M and over. Values between those reported are estimated using log-log interpolation.
Net compensation is wages, tips, and the like subject to Medicare taxes. It is reported by employers on Form W-2 in box 5. It is often higher than Federally taxable income, reported in box 1, because it includes amounts contributed to 401k, 403b, and similar retirement plans. Beginning with 1991, net compensation includes contributions to deferred compensation plans, but excludes certain distributions from plans where the distributions are included in the reported compensation subject to income taxes. Net compensation is not capped by the wage base.
The Consumer Price Index is accessed from FRED at the Federal Reserve Bank of St. Louis.
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The website is for educational purposes. Returned ranks are estimates. There is no API. Batch calls are limited.
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