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Team Players: How Social Skills Improve Team Performance

Most jobs require teamwork. Are some people good team players? In this paper we design and test a new method for identifying individual contributions to team production. We randomly assign people to multiple teams and predict team performance based on previously assessed individual skills. Some people consistently cause their team to exceed is predicted performance. We call these individuals “team players”. Team players score significantly higher on a well-established measure of social intelligence, but do not differ across a variety of other dimensions, including IQ, personality, education and gender. Social skills – defined as a single latent factor that combines social intelligence scores with the team player effect – improve team performance about as much as IQ. We find suggestive evidence that team players increase effort among teammates.

Weidmann, B. and Deming, D.J., 2021. Team players: How social skills improve team performance. Econometrica, 89(6), pp.2637-2657.

The Growing Importance of Decision-Making on the Job

Machines increasingly replace people in routine job tasks. The remaining tasks require workers to make open-ended decisions and to have “soft” skills such as problem-solving, critical thinking and adaptability. This paper documents growing demand for decision-making and explores the consequences for life-cycle earnings. Career earnings growth in the U.S. more than doubled between 1960 and 2017, and the age of peak earnings increased from the late 30s to the mid-50s. A substantial share of this shift is explained by increased employment in decision-intensive occupations, which have longer and more gradual periods of earnings growth. To understand these patterns, the paper develops a model that nests decision-making in a standard human capital framework. Workers predict the output of uncertain, context-dependent actions. Experience reduces prediction error, improving a worker’s ability to adapt using data from similar decisions they have made in the past. Experience takes longer to accumulate in high variance, non-routine jobs. The paper tests the predictions of the model using data from the three waves of the NLS. Life-cycle wage growth in decision-intensive occupations has increased over time, and it has increased relatively more for highly-skilled workers.

Deming, D.J., 2021. The growing importance of decision-making on the job (No. w28733). National Bureau of Economic Research.

The Growing Importance of Social Skills in the Labor Market

The labor market increasingly rewards social skills. Between 1980 and 2012, jobs requiring high levels of social interaction grew by nearly 12 percentage points as a share of the U.S. labor force. Math-intensive but less social jobs—including many STEM occupations—shrank by 3.3 percentage points over the same period. Employment and wage growth were particularly strong for jobs requiring high levels of both math skill and social skills. To understand these patterns, the paper develops 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 work together more efficiently. The model generates predictions about sorting and the relative returns to skill across occupations, which are investigated using data from the NLSY79 and the NLSY97. Using a comparable set of skill measures and covariates across survey waves, the paper finds that the labor market return to social skills was much greater in the 2000s than in the mid-1980s and 1990s.

Deming, D.J., 2017. The growing importance of social skills in the labor market. The Quarterly Journal of Economics, 132(4), pp.1593-1640.

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