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Wage Garnishment in the United States: New Facts from Administrative Payroll Records
Anthony A. DeFusco, Brandon Enriquez, and Maggie Yellen
American Economic Review: Insights. Mar 2024, Vol. 6, No. 1: Pages 38-54

Wage Garnishment in the United States: New Facts from Administrative Payroll Records

Anthony A. DeFusco1, Brandon Enriquez2 and Maggie Yellen3

1University of Wisconsin–Madison and NBER (email: )

2Massachusetts Institute of Technology (email: )

3Massachusetts Institute of Technology (email: )

Abstract

Wage garnishment allows creditors to deduct money from workers’ paychecks to repay defaulted debts. We document new facts about wage garnishment between 2014 and 2019 using data from a large payroll processor that distributes paychecks to approximately 20 percent of US private-sector workers. By 2019, over 1 in every 100 workers was being garnished for delinquent debt. The average garnished worker experiences garnishment for five months, during which approximately 11 percent of gross earnings is remitted to their creditor(s). The beginning of a garnishment is associated with an increase in job turnover but no intensive margin change in hours worked. (JEL G51, J22, J63)