Multidimensional Skills as a Measure of Human Capital: Evidence from LinkedIn Profiles

We measure human capital using the self-reported skill sets of 8.75 million U.S. college graduates from professional profiles on the online platform LinkedIn. We establish that these skills are systematically related to human capital investments such as different types of schooling and work experience. The average profile of the number of reported skills by age looks remarkably similar to the well-established concave age-earnings profiles. More experienced workers and those with higher educational degrees have larger shares of occupation-specific skills, consistent with their acquisition through professional-degree programs and on-the-job experience. Workers who report more, and particularly more specific and managerial, skills are more likely to hold highly paid jobs. Skill differences across workers can account for more earnings variation than detailed vectors of education and experience. We also document a substantial gender gap in reported skills, which starts to manifest when young women reach typical ages of first motherhood. Gender differences in skill profiles can rationalize a substantial proportion of the gender gap in the propensity to work in highly paid jobs. Overall, the results are consistent with an important role of multidimensional skills in accounting for several well-known basic labor-market patterns.