If a cross section in PROC PANEL has complete data for the independent variables in a time period and a missing response, incorrect values are saved to the data set generated by the OUTPUT statement. Observations with complete data for the regressors should have a value for the PREDICTED= variable, but they contain a missing value instead. The corresponding observation for the RESIDUAL= variable contains an incorrect value.
Note that PROC PANEL does not provide the functionality to compute predicted values if all of the cross sections contain a missing response for a time period.
There is no circumvention for this problem.