Firm Heterogeneity in Skill Demands
NBER Working Paper No. 23328
We study variation in skill demands across firms and labor markets using job vacancy postings. We categorize a wide range of keywords found in job ads into ten general skills. We find a positive correlation between average wages and cognitive skill and social skill requirements that remains even after controlling for occupation, industry, and MSA fixed effects. We also find a positive correlation between these skill requirements and indicators of firm performance such as revenue per worker and whether the firm is publicly traded. These returns are concentrated among ads that specify both a cognitive and social skill requirement. Job skills have explanatory power for pay and firm performance, beyond what is available in widely-used labor market data.
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Document Object Identifier (DOI): 10.3386/w23328
Forthcoming: Firm Heterogeneity in Skill Demands, David Deming, Lisa Kahn. in Firms and the Distribution of Income: The Roles of Productivity and Luck, Lazear and Shaw. 2016