Cognitive performance and labour market outcomes

an article by Dajun Lin (University of Virginia, USA), Randall Lutter (University of Virginia and Resources for the Future, USA) and Christopher J. Ruhm (University of Virginia and National Bureau of Economic Research, USA) published in Labour Economics Volume 51 (April 2018)

Highlights

• Cognitive performance is associated with future labour market outcomes at all ages.
• The estimated return to cognitive performance rises with age.
• Associations with incomes reflect associations with wage rates and hours worked.
• Relative returns to cognitive performance vary with race, ethnicity and sex.

Abstract

We use the U.S. National Longitudinal Survey of Youth 1979 and other sources to examine how cognitive performance near the end of secondary schooling relates to labour market outcomes through age fifty.

Our preferred estimates control for individual and family backgrounds, non-cognitive attributes, and survey years. We find that returns to cognitive skills rise with age.

Although estimated gains in lifetime incomes are close to those reported earlier, our preferred estimates make multiple offsetting improvements.

Returns to cognitive skill are greater for blacks and Hispanics than for non-Hispanic whites, both in relative and absolute terms, with gains in work hours being more important than in hourly wages.

JEL Classification: J08, J31

---

Does Trait Emotional Intelligence Predict Unique Variance in Early Career Beyond IQ and Personality Success

an article by José Manuel de Haro García (Agbar water company (GDF SUEZ), Comunidad Valenciana, Spain) and Juan Luis Castejón Costa (Alicante University, Spain) published in Journal of Career Assessment Volume 22 Number 4 (November 2014)

Abstract

In order to determine the contribution of emotional intelligence (EI) to career success, in this study, we analysed the relationship between trait EI (TEI), general mental ability (GMA), the big five personality traits, and career success indicators, in a sample of 130 graduates who were in the early stages of their careers.

Results from hierarchical regression analyses indicated that TEI, and especially its dimension “repair,” has incremental validity in predicting one of the career success indicators (salary) after controlling for GMA and personality.

These findings provide support for the use of TEI measures as predictors of career success in the early stage.

---

Hard evidence on soft skills

an article by James J. Heckman (University of Chicago, USA, American Bar Foundation, Chicago and University College Dublin, Ireland) and Tim Kautz (University of Chicago, USA) published in Labour Economics Volume 19 Issue 4 (August 2012)

Abstract

This paper summarizes recent evidence on what achievement tests measure; how achievement tests relate to other measures of “cognitive ability” like IQ and grades; the important skills that achievement tests miss or mismeasure, and how much these skills matter in life.

Achievement tests miss, or perhaps more accurately, do not adequately capture, soft skills – personality traits, goals, motivations, and preferences that are valued in the labour market, in school, and in many other domains.

The larger message of this paper is that soft skills predict success in life, that they causally produce that success, and that programs that enhance soft skills have an important place in an effective portfolio of public policies.

Highlights

► Achievement tests miss – or mis-measure – soft skills including personality traits, goals, motivations, and preferences.
► Soft skills predict and produce success in life.
► Programs that enhance soft skills have an important place in policy portfolios.

JEL classifications: I20; D01

---