Data from W-2's allow closer look at income higher on the wage scale

December 21, 2010 — Data from the Social Security Administration’s “net compensation” reports derived from wage income reported on W-2’s provide a revealing look at how income is distributed in the United States (although, since non-wage income is not reported, high-end income is still understated).

In the first chart, each income band has a single bar showing the workers in the band as a percentage of all workers (the orange part) and the wages of workers in the income as a percentage of the wages of all workers (the blue part). At the lowest end, the percentage of workers is much higher than the percentage of total wages; at the high end of the income spectrum, the converse is true. Because of differences in scale, income bands starting at $1 million and up have to be depicted on the chart on page 2.

Note: none of the data are inflation-adjusted.