Earnings inequality is best measured on full-time workers aged 25-55 to avoid compositional noise

Evidence

We restrict the scope of this measure to the core workforce, defined as full-time and fullyear workers ages 25–55. This restriction avoids the interferences of parttime, school attendance, and retirement trends. We then adjust the earnings for top coding and inflation into 2001 U.S. dollars and exclude workers with annual earnings equal to or lower than $100. — Ken-Hou Lin & Donald Tomaskovic-Devey, Financialization and U.S. Income…, 81