Integrated Longitudinal Employer-Employee Data for the United States

Abstract

The development of a database infrastructure that captures the complex interactions among households and businesses at the microeconomic level and characterizes the dynamics of the modern economy is critical for the social sciences. The creation of such an infrastructure has posed a major challenge to national statistical institutes. Since most institutes collect, store, and disseminate data on the engines of economic growth (businesses and households) in twin data silos, proposals to integrate the two face technical, monetary, legal, and policy obstacles that go far beyond the norm of datacollection activities. Recent efforts at the Longitudinal Employer–Household Dynamics (LEHD) Program at the U.S. Census Bureau have finally made this critical data infrastructure achievable and accessible. The potential uses of longitudinal integrated employer–employee data are far-reaching. A partial list includes: the effect of technological and structural change on earnings, employment, and productivity; the analysis of the firmspecific contribution to pay; the effect of firm wage-setting and turnover policies on productivity; the impact of firm policies on different groups of workers (e.g., welfare recipients); the effect of firm expansion, exit, and relocation decisions on neighborhood demographic composition, the analysis of worker commuting patterns and mobility; and a full accounting of the