https://docs.google.com/spreadsheets/d/1U3oDVMVPHuCPhUVGJ6imIzQwLFoAl5Bnn4J5TUbDW1U/edit?usp=sharing
Abstract
I show that the labor market increasingly rewards social skills. Between 1980 and 2012, jobs with high socials skill requirements grew by nearly 10 percentage points as a share of the U.S. labor force. In contrast, math-intensive but less social jobs (including
many STEM occupations) shrank by about 3 percentage points over the same period. Employment and wage growth was particularly strong for jobs requiring high levels of both cognitive skill and social skill. To understand these patterns, I develop a model of
team production where workers "trade tasks" to exploit their comparative advantage. In the model, social skills reduce coordination costs, allowing workers to specialize and trade more efficiently. The model generates predictions about sorting and the relative
returns to skill across occupations, which I test and confirm using data from NLSY79 and the NLSY97. Using a comparable set of skill measures and covariates across survey waves, I show that the labor market return to social skills was much greater in the 2000s
than in the mid 1980s and 1990s.