Personal remittances is the sum of personal transfers and compensation of employees. Personal transfers, a new item in the Balance of Payments Manual 6th Edition (BPM6), represents a broader definition of worker remittances. Personal transfers include all current transfers in cash or in kind between resident and nonresident individuals, independent of the source of income of the sender (and regardless of whether the sender receives income from labor, entrepreneurial or property income, social benefits, and any other types of transfers; or disposes assets) and the relationship between the households (regardless of whether they are related or unrelated individuals).
Compensation of employees refers to the income of border, seasonal, and other short-term workers who are employed in an economy where they are not resident and of residents employed by nonresident entities. Compensation of employees represents remuneration in return for the labor input to the production process contributed by an individual in an employer-employee relationship with the enterprise. Compensation of employees has three main components: wages and salaries in cash, wages and salaries in kind, and employers’ social contributions. Compensation of employees is recorded gross and includes amounts paid by the employee as taxes or for other purposes in the economy where the work is performed.
Data on personal remittances come from the IMF’s Balance of Payment Statistics database. Some missing data are replaced gapfilled by World Bank staff estimates.