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Abstract This paper used two waves (2016 and 2018) of longitudinal data from the China Families Panel Survey (CFPS) to analyze the economic impact of Non-communicable chronic diseases (NCDs) on individual earned income using propensity score matching and difference in difference (PSM-DID) methods to control for potential confounding. The occurrence of a NCDs was associated with a significant decrease in earned income by 19.2% (P = 0.002, t = 3.75). The reasons for this decrease include: a lower labour force participation rate; lower weekly hours worked; and a lower average hourly wage. After holding labour market behaviours constant, different types of NCDs have different impacts on earned income. Musculoskeletal diseases have the greatest negative impact, accounting for a 21.5% decrease in individual earned income (p < 0.0001, t = −7.84), while digestive system diseases have the smallest impact accounting for a 6.9% decrease in earned income (p = 0.012, t = −2.52).