Total income – personal, family, combined parental, extended family and household

## Definition

'Total personal income' represents the before-tax income of the respondent in the 12 months ending 31 March 2006. It is collected as an income range rather than an actual dollar income.

Total personal income is aggregated to derive the following variables:

• total family income
• combined parental income for couples with child(ren)
• total extended family income
• total household income.

'Total family income' is derived by aggregating the total personal income of all members of the family nucleus who are aged 15 years and over.

'Combined parental income for couples with child(ren)' is derived by aggregating the total personal income for the couple.

'Total extended family income' is derived by aggregating the total personal income of all members of the extended family who are aged 15 years and over.

'Total household income' is derived by aggregating the total personal income of all members of the household who are aged 15 years and over.

The definitions of 'family' and 'extended family' are restricted to people living in the same household. Therefore, although financial interdependence can exist across households, the family income and extended family income data relates to people living in the same household.

As total personal income is collected in income ranges (eg \$25,001–\$30,000), and not as an actual dollar income (eg \$29,500), in order for total family income to be calculated, a representative income is determined for each total personal income range. Total family income is derived by adding together the median total personal incomes of each member of the family nucleus who is aged 15 years and over. As a result of this calculation, a family income category is assigned to the family.

Household income is calculated in a similar way to family income, except that all people in the household who are aged 15 years and over are included in the calculation.

Extended family income is calculated in a similar way to family income, except that all people in the extended family who are aged 15 years and over are included in the calculation.

## Relationship to questionnaire

Data on total personal income comes from question 31 on the individual form (PDF 395kb).

## Subject population

The subject population is the people, families, households or dwellings to whom the variable applies.

The subject population for total personal income is the census usually resident population count aged 15 years and over.

The subject population for total family income is families in private occupied dwellings.

The subject population for combined parental income for couples with child(ren) is couples with children in private occupied dwellings.

The subject population for total extended family income is extended families in private occupied dwellings.

The subject population for total household income is households in private occupied dwellings.

Total family income and total household income are not available for a small number of families and households.

## Non-response rate

The 2006 non-response rates for the total income variables were:

• total personal income: 10.2 percent
• total family income: 13.9 percent
• combined parental income for couples with child(ren): 11.3 percent
• total extended family income: 31.0 percent
• total household income: 16.2 percent.

In 2001 the non-response rate was 11.1 percent for total personal income, 16.1 percent for total family income, 13.8 percent for combined parental income for couples with child(ren), and 18.5 percent for total household income. Total extended family income was deemed not fit for use, because of a non-response rate of 35.5 percent.

Total family income, extended family income, and household income data are affected by absentees and other people who did not answer the income question. The total personal income of an absentee can not be included in the calculation of these variables. Where there was one or more absentee aged 15 years or over, the income for the family, extended family or household was set to 'not stated' unless the accumulated income was already \$100,001 or more. Likewise, if someone had not stated their income, the income for the family, extended family or household was set to not stated unless the \$100,001 or more threshold had already been reached. This has affected the quality of these variables and care should be taken when using them. The effect becomes more marked as the number of people in the family, extended family or household increases.

## Quality Management Strategy priority level

These variables are defining variables.

The Census Quality Management Strategy assigns a priority level to all census variables.

Defining variables cover key subject populations that are important for policy development, evaluation or monitoring. These variables are given secondary priority in terms of quality, time and resources across all phases of a census.

All data must meet minimum quality standards in order to make it suitable for use.

## Comparability with 1996 and 2001 Census data

There are issues affecting the comparability of this data with 1996 and 2001 Census data:

• data on extended family income was not fit for use in 2001
• for 2006 the \$30,001–\$40,000 income band has been split into two:
• \$30,001–\$35,000
• \$35,001–\$40,000.

## Significant issues

• Caution should be used when interpreting this data, because of the relatively high percentage in the not stated category.
The high non-response rates can lead to bias in the data. This bias affects the aggregates and the distribution with the proportion of people in low income bands being under-counted. The bias will mean that the data is not fit for use for certain purposes. Distributional statistics like averages and medians will be biased by the undercount of people in the low income bands, while disparities at regional or ethnic group level may be understated for the regions and ethnic groups with high non-response rates. Population-based funding models that use income as a variable, and small area regional analysis for territorial local authorities and others, will also be affected by the bias.
• The effects of the non-response rates at the individual level are compounded when deriving income for families, households and (especially) extended families, as a greater number of respondents' incomes are required to produce a derived income variable. The derivation of income for families, households and extended families is also affected by the high non-response rate to the income question among particular ethnic groups.
• The fitness for use of the total extended family income data needs to be assessed on a table-by-table basis. The non-response rate is slightly lower than in 2001, but is still extremely high.

## Other things to be aware of

• The 2006 questionnaire had a note directing people to the help notes to help them determine their income. This note was not present in 2001.
• Additional grouped total income variables were introduced in 2006 (grouped personal, combined parental, family, extended family and household income). These variables are for the output of income data at low geographic levels (meshblock, area unit, and user-defined combinations of these) without compromising confidentiality, and are aggregated from the standard total income variables.
• Caution is advised when analysing income data by ethnic group because of the high non-response rate of certain ethnic groups and changes to the ethnicity classification. The non-response rate was highest for Pacific peoples and lowest for 'other'. Non-response rates from highest to lowest were as follows:
• Pacific peoples: 16.9 percent
• Middle Eastern/Latin American/African: 12.0 percent
• Māori: 11.5 percent
• Asian: 8.9 percent
• European: 5.2 percent
• Other: 4.3 percent.
• The time reference periods for income variables and other variables that may be cross-tabulated with income variables are different. For example:
• total personal income covered the year ending 31 March 2006
• sources of personal income covered the year ending 7 March 2006
• work and labour force status, occupation and industry covered the seven days ending 5 March 2006.
• All census data was subject to considerable checks (including edits) during processing and evaluation, to ensure that it meets quality standards and is suitable for use. These checks were applied to data supplied both on paper and on Internet forms. In addition to these quality checks, the Internet form had built-in editing functionality that directed respondents to the appropriate questions and ensured that their responses were valid. As a result of this, data from Internet forms may be of higher overall quality than data from paper forms. The significance of this will depend on the particular type of analysis being done.
• There were differences between how the forms were completed on the Internet and on paper for this variable:
• The Internet form allowed only one response to be selected for the income question. If a further response was selected, the response given previously disappeared. Multiple responses to this question were possible when forms were completed on paper.
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