Monday, March 22, 2010

Survey of Income and Program Participation (SIPP): An Introduction

The Survey of Income and Program Participation has its roots in the War on Poverty of the Johnson Administration in the late 1960s.  It was hard to find good data on welfare and income for poor people.  To meet this need, the U.S. Department of Health, Education, and Welfare (now HHS) created the Income Survey Development Program (ISDP) in 1975.  According to Citro and Scholz (2009, pp. 18-19), the transition from ISDP to the new SIPP survey proceeded in fits and starts, narrowly surviving cancellation until 1984, when the first SIPP panel of about 21,000 households finally began.

From 1985 through 1993, new panels were introduced every February, on a rotating basis.  Within each panel, households were followed through multiple four-month waves (Citro & Scholz, p. 22).  That is, the sample was divided into four groups, and all of the households in a given group were interviewed once every four months, also on a rotating basis.  After a major redesign effort beginning in 1993, panels were interviewed every four months over a four-year period, and one panel was completed before another was introduced.  After 1993, then, panels were introduced in 1996, 2001, 2004, and 2008 (pp. 23-24, 29).

SIPP seems to have been plagued, throughout its existence, by irregular and inadequate political support and funding.  In 2006, the Bush Administration proposed to cut its budget from $44 million to $9.2 million, and to focus more than half of the latter figure on the creation of a new data collection program called the Dynamics of Economic Well-being System (DEWS) (p. 28).  DEWS would rely upon administrative sources of data, rather than a survey, to update and complement decennial census data.  Congress was persuaded that SIPP was important, however, and instead cut its 2007 budget to $33 million in 2007 (p. 29).  DEWS was downscaled, and now seems to survive as the "re-engineered SIPP."

In the 2004 and 2008 panels, it was planned that households would be followed for as many as 12 waves.  These panels used 51,400 households in 2004 and 45,000 in 2008 (pp. 25, 29).  Budgetary and resource restrictions forced a significant cutback in the numbers of households and waves in later years of the 2004 panel.  The 2008 panel now seems to have sufficient funding to carry through to completion.  Data from the 2008 panel will apparently become available in 2012.  The next panel is planned for 2013, structured as a three- or four-year series of annual interviews.

In their book, Citro and Scholz provide extensive information on strengths and weaknesses of SIPP, recommendations for improving data quality and using administrative records effectively, potential innovations in data collection, and other matters.  The general sense is that these authors consider the SIPP flawed but capable of being greatly improved, and in any event irreplaceable as a practical matter.