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Do Non-Cognitive Skills Produce Heterogeneous Returns Across Different Wage Levels Amongst Youth Entering the Workforce? A Quantile Mixed Model Approach

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  • Garen Avanesian

    (Department of Human Resources Management, Southern Federal University, 344006 Rostov-on-Don, Russia
    Department of Organizational Psychology, Southern Federal University, 344006 Rostov-on-Don, Russia)

Abstract

This study estimates the labor market returns to non-cognitive skills among the youth under 30 years old during the early career stage. Using data from the Russian Longitudinal Monitoring Survey (RLMS-HSE) for 2016 and 2019, it examines the effects of the Big Five personality traits (openness, conscientiousness, extraversion, agreeableness, and emotional stability) on hourly wages. To account for potential heterogeneity in the effect of non-cognitive skills along the wage distribution, a quantile linear mixed model is employed, estimating returns at the 10th, 25th, 50th, 75th, and 90th percentiles while controlling for repeated observations with random intercepts at the individual level. Inverse probability weighting is applied to address the selection of employment. The results indicate that openness yields the highest returns for young workers, though its effect diminishes after controlling for educational attainment. By controlling for education, the model identifies the effect of conscientiousness below the median wage level, and that of extraversion above. Finally, the study finds that the impact of non-cognitive skills on wages evolves over the life course. First, the effects of non-cognitive skills on wages vary a lot in the youth group and the entire working population (ages 16–65). Furthermore, breaking the data down by age cohorts reveals how their significance and magnitude shift at different career stages.

Suggested Citation

  • Garen Avanesian, 2025. "Do Non-Cognitive Skills Produce Heterogeneous Returns Across Different Wage Levels Amongst Youth Entering the Workforce? A Quantile Mixed Model Approach," Economies, MDPI, vol. 13(5), pages 1-20, April.
    • Handle: RePEc:gam:jecomi:v:13:y:2025:i:5:p:114-:d:1639973
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    References listed on IDEAS

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    2. Ksenia V. Rozhkova & Natalya Yemelina & Sergey Yu. Roshchin, 2021. "Can Non-Cognitive Skills Explain The Gender Wage Gap In Russia? An Unconditional Quantile Regression Approach," HSE Working papers WP BRP 252/EC/2021, National Research University Higher School of Economics.
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    4. Garen Avanesian & Marina Borovskaya & Marina Masych & Ludmila Dikaya & Victoria Ryzhova & Valeria Egorova, 2024. "How Far Are NEET Youth Falling Behind in Their Non-Cognitive Skills? An Econometric Analysis of Disparities," Economies, MDPI, vol. 12(1), pages 1-15, January.
    5. Blackburn, McKinley L & Neumark, David, 1993. "Omitted-Ability Bias and the Increase in the Return to Schooling," Journal of Labor Economics, University of Chicago Press, vol. 11(3), pages 521-544, July.
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