Length of pay periods in the Current Employment Statistics survey

The BLS Current Employment Statistics (CES) survey produces employment, hours, and earnings data series, covering nearly 900 industries at various levels of aggregation. To provide this detailed information on workers on nonfarm payrolls, CES collects data from about 122,000 businesses and government agencies representing approximately 666,000 individual worksites, or establishments. ¹

The active CES sample includes about one-third of all nonfarm payroll employees in the nation. Data are collected each month from establishments for the pay period that includes the 12th of the month. The length of this pay period is specific to each business and depends on how frequently it pays its employees. This means that businesses participating in the CES survey report information on total employment, hours, and earnings for various lengths of pay period. Pay periods can be weekly, biweekly (every two weeks), semimonthly (twice a month), or monthly. ²

CES estimates of hours and earnings are published as weekly values. Therefore, reported data for pay periods other than weekly must be modified, or normalized, to a common weekly basis. For example, an establishment that pays employees for a 2-week pay period will need to have its reported hours divided in half in order to calculate average weekly hours for a one week period. For this reason, respondents reporting hours or earnings information are also asked to provide the length of their pay periods. ³

These data include overall pay period frequency, as well as pay period frequency by establishment size and by industry. The data come from reports submitted to CES by respondents participating in the CES survey. They are point-in-time calculations and should not be used as a continuous time series. Each data observation used in these length of pay period calculations represents one establishment and the length(s) of pay period they use. Establishments that pay all workers for the same length of pay period are referred to as single-pay-period reporters, whereas establishments that pay some workers for one length of pay period and other workers for another length of pay period are referred to as multiple-pay-period reporters. The CES program collects data for up to two lengths of pay periods for each establishment. ⁴

To calculate length of pay period estimates, each establishment in the CES survey was assigned a weight, which was determined by the establishment’s chance of being selected to be in the CES sample. The weight represents the inverse of the establishment’s chance of selection; so, for example, an establishment with a one-in-five chance of selection was assigned a weight of five. ⁵

This same weight that is used in producing the survey’s employment, hours, and earnings estimates, was also applied to estimates on length of pay periods. The weighted length-of-pay-period data result in estimates of the percentage of private establishments operating under each length of pay period in the United States. Government and public and private educational establishments’ hours and earnings data are out of scope for length of pay period data as the CES survey does not collect hours or earnings data for these series. In February 2023, biweekly was the most common length of pay period, with an estimated 43.0 percent of U.S. private establishments paying their employees every 2 weeks. Weekly pay periods were almost as common, with 27.0 percent of private establishments paying employees each week. Semimonthly and monthly pay frequencies were less common. Table 1 and Chart 1 show the February 2023 distribution of private establishments operating under each length of pay period.

The distribution of lengths of pay period can also be examined by size and by industry.

Establishment size

The CES survey groups reporting establishments into eight different size classes based on the maximum number of employees within the business over the previous 12 months. The percentages of private establishments operating under each length of pay period are sorted by size class (see chart 2).

Industry

The CES survey classifies establishments into industry groups, based on the 2022 North American Industry Classification System (NAICS). ⁶

In three industries–construction, private education and health services, and leisure and hospitality–a large majority of establishments pay their employees under one main length of pay period. The construction industry displays the most uniformity in its pay period, with 65.4 percent of establishments in the industry using a weekly pay period. Within private education and health services, 63.6 percent of establishments utilize the biweekly pay period.

The percentages of private establishments operating under each length of pay period are sorted by industry (see table 3).

To summarize, there is no specific pay period used by a majority of private establishments. The biweekly pay period is the most common, followed next by weekly, then semimonthly, then monthly. Certain pay periods tend to dominate in individual industries; an example being the use of weekly pay periods by 65.4 percent of construction establishments. And the use of the most common pay period–biweekly–tends to increase with the movement from smaller to larger establishment size classes. Length of pay period data may help users understand potential effects on CES data, for example, industries with shorter pay periods may be more likely to be impacted by severe weather events. The information presented here may also be useful to those interested in understanding or researching pay frequencies and their impact on workers and the economy. Pay period frequency affects the timing of budgetary and financial decisions made by both workers and employers. Workers paid weekly, for example, have the most frequent access to their pay, while workers who are paid monthly may have to defer some purchases or payments until they receive their pay. Conversely, businesses paying workers every week may face short-term constraints on their ability to make non-labor expenditures that businesses with longer pay periods do not.

Notes:

¹Data collection and industry classification for the Current Employment Statistics (CES) survey occurs at the worksite–or establishment–level. The terms “worksite” and “establishment” are used interchangeably. An establishment is not the same as a firm or company. Establishments are usually individual worksites dedicated to a single economic activity. For a more detailed explanation of CES concepts and methodology, see the Current Employment Statistics - National section of the BLS Handbook of Methods at https://www.bls.gov/opub/hom/ces/home.htm.

²For state payday requirements, see Wage and Hour Division: state payday requirements (U.S. Department of Labor, January 1, 2023), http://www.dol.gov/whd/state/payday.htm

³For state payday requirements, see Wage and Hour Division: state payday requirements (U.S. Department of Labor, January 1, 2023), http://www.dol.gov/whd/state/payday.htm

⁴Length of pay period data produced by CES is a “snapshot” of specific point in time, and is not a time series. The data presented here is for February 2023.

⁵Information on the CES sample and its implementation are available in the Current Employment Statistics - National section of the BLS Handbook of Methods at https://www.bls.gov/opub/hom/ces/data.htm#sample-implementation.

⁶Information on NAICS in the CES program is available at https://www.bls.gov/ces/naics/home.htm.

Last Modified Date: August 4, 2023