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1. Author's tabulations from the 1990 and 1998 March Current Population Surveys (CPS).
2. For this computation, we divide total wage and salary income plus positive non-farm self-employment income by total hours worked.
3. This calculation relies on the strong assumption that the "exit rate" from low-wage status remains constant over time at 40 percent. Thus, the probability that a low-wage worker in one year remains a low-wage worker for the next three years is 0.6*0.6*0.6=0.22. This is likely an underestimate of low-wage persistence because the probability of exiting from low-wage status probably declines over time due to differences (in skill levels, for example) between workers who exit low-wage status in one year and those who are low-wage for multiple years.