The role of personality traits in shaping economic returns amid technological change

Rapid advancements in artificial intelligence and other technologies are reshaping labour markets and challenging long-held beliefs about the skills and character traits that drive success. This column investigates the personalities best suited to different occupations, and the resulting implications for organisational strategy. The findings suggest that intellectual tenacity – the ability to persist through challenges and innovate in complex, non-routine tasks – is increasingly rewarded, while social adjustment – capturing interpersonal skills – remains essential for collaborative roles.

The rapid advancement of technology, particularly artificial intelligence (AI), is reshaping the labour market, challenging long-held notions of the skills and traits that drive success. Recent work by Eloundou et al. (2023) suggests that up to 80% of the workforce could see at least 10% of their tasks influenced by AI and large language models.

While much attention has been paid to technical skills, in a recent paper (Makridis and Hickman 2024), Louis Hickman and I explore how personality traits – specifically, intellectual tenacity and social adjustment – influence labour market outcomes, including wages and employment growth. Our research arrives conveniently following the World Economic Forum’s publication of the Future of Jobs Report 2025, which finds that “creative thinking and resilience, flexibility and agility are also rising in importance, along with curiosity and lifelong learning”. Notably, these are more habits than skills.

Our study provides new empirical insights by combining data from the US Department of Labor’s Occupational Information Network (O*NET), the American Community Survey (ACS), and the Bureau of Labor Statistics (BLS) from 2007 to 2019. Employing underutilised data on 16 different occupational personality requirements, we use principal component analysis and identify two major factors that we call ‘intellectual tenacity’ and ‘social adjustment’.

• Intellectual tenacity encompasses traits like analytical thinking, persistence, initiative, and innovation. This dimension reflects the ability to tackle non-routine, problem-solving tasks requiring autonomy and effort.
• Social adjustment includes traits like emotion regulation, cooperation, and stress tolerance. This dimension captures interpersonal skills vital for roles involving face-to-face interactions and empathy.

These dimensions build on research showing that personality traits (often termed ‘non-cognitive skills’, see Borghans et al. 2008) predict higher wages and better job performance (He et al. 2019). While individual traits have been well studied, less is known about how occupational-level factors shape labour market outcomes (Denissen et al. 2018).

Our analysis uses over ten million observations from the ACS, linked with occupational-level data on personality requirements from O*NET and cognitive skill requirements from the BLS. This dataset allows us to estimate the relationships between personality requirements, wages, and employment growth while controlling for a host of confounding factors, including cognitive abilities, demographic characteristics, and fixed effects at the occupational and industry levels. Figure 1 provides a visualisation of these raw relationships (i.e. without controls).

Figure 1 Occupational employment growth and log annual earnings as a function of intellectual tenacity and social adjustment

To address the potential for omitted variable bias, we employ several strategies:

• Occupational fixed effects: by focusing on year-to-year employment growth within occupations, we control for unobservable, time-invariant characteristics that might drive differences in personality requirements across occupations.
• Cognitive ability controls: including measures of cognitive skill requirements ensures that the estimated effects of personality traits are not confounded by differences in cognitive demands.
• Robustness to demographics and industry effects: additional controls for demographic characteristics and two-digit industry fixed effects further reduce the risk of bias due to selection into occupations.
• Non-linear and interaction terms: we test for non-linear relationships and interactions between personality dimensions to capture more nuanced effects, especially given prior evidence of complementarity between social and technical skills (Deming 2017).

While our observational study cannot fully rule out selection effects, the robustness of our findings across specifications and subgroups suggests that our results reflect meaningful labour market dynamics rather than unobserved confounders.

We find four major results:

1. A wage premium for intellectual tenacity. Occupations requiring higher levels of intellectual tenacity exhibit significant wage premiums. For example, occupations like physicists and nurse anaesthetists rank highly in intellectual tenacity and show strong earnings growth, consistent with the returns to problem-solving and decision-making skills in non-routine, cognitively demanding jobs (Deming 2021). The relationship is non-linear, with increasing returns at higher levels of intellectual tenacity. This suggests that beyond a certain threshold, occupations requiring persistent, innovative, and analytical effort yield outsized labour market rewards.
2. Mixed returns for social adjustment. Social adjustment, while critical for interpersonal tasks, exhibits a more complex relationship with wages. For occupations emphasising traits like cooperation and stress tolerance (e.g. flight attendants, special education teachers), we find little to no wage premium. In some specifications, social adjustment is negatively associated with wages, though there is some evidence of complementarity when combined with intellectual tenacity (Deming 2017).
3. Employment growth across both dimensions. Both intellectual tenacity and social adjustment are positively associated with employment growth from 2007 to 2019, reflecting growing demand for traits that enable workers to adapt to the interdependent, collaborative nature of modern workplaces (Wegman et al. 2018). When cognitive abilities are controlled for, social adjustment becomes a stronger predictor of employment growth, particularly in occupations requiring face-to-face interaction and empathy.
4. Diverging trends over time. The labour market increasingly values intellectual tenacity; its wage premium grew over the study period. Simultaneously, social adjustment has become less valued; its wage deficit worsened. This divergence reflects the growing emphasis on autonomy, problem-solving, and persistence in high-skill jobs, even as interpersonal skills remain critical in certain contexts. To be clear, these results do not imply that social adjustment does not matter, but rather that, after controlling for intellectual tenacity and many other confounding factors, social adjustment is less associated with higher income, though it displays some complementarity with intellectual tenacity.

Our findings point to the importance of aligning hiring practices with the evolving demands of the labour market. In particular, organisations may consider shifting focus away from pure proxies like degrees and past employers and toward assessments of intellectual tenacity and other personality traits. Emerging tools, such as automated personality assessments, offer scalable ways to identify candidates suited for non-routine, decision-intensive roles. For policymakers and educators, these findings also highlight the need to complement technical training with programmes that foster traits like persistence, problem-solving, and emotional intelligence.

As the labour market evolves, personality traits are emerging as critical determinants of career success and economic productivity. Our research suggests that intellectual tenacity – the ability to persist through challenges and innovate in complex, non-routine tasks – is increasingly rewarded, while social adjustment remains essential for collaborative roles. By rethinking how personality aligns with job requirements, organisations and policymakers can better navigate the challenges of a rapidly changing economy.

Source : VOXeu