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

Wage garnishment allows private and public creditors to pull money directly out of a worker’s paycheck to repay defaulted debt. Despite growing public concern surrounding the effects of strict debt collection mechanisms, a dearth of data has precluded empirical examination of the prevalence of wage garnishment and its effect on U.S. workers. Using administrative payroll data, we document five new descriptive empirical facts about wage garnishment, including its prevalence; duration; stringency; distribution across worker characteristics; and interaction with labor supply. Together, these facts shed light on an important but understudied form of debt collection and lay foundation for future research