Skills, Skill Use at Work, and Earnings of American Workers. The Impact of Human Capital in the American Labor Market Series

As with the previous reports in the series, this new report relies on the rich source of data from the Programme for the International Assessment of Adult Competencies (PIAAC), including direct assessment of literacy and numeracy skills and a host of information on education, income, and other demographic characteristics. But what is unique in this report is that it also utilizes detailed data on skill use including the frequency with which respondents reported using reading, numeracy, and writing skills in their job. This study builds on the series' previous research on the effect of skills on the earnings of American workers by examining the use of workers' skills on the job as an additional determinant of the earnings of American workers (in addition to human capital--literacy proficiencies, education, work experience--and other factors that are known to affect earnings). The paper begins with a descriptive analysis of the link between reading skill use at work and the literacy proficiencies of workers. The authors explore differences in the literacy proficiencies (mean literacy scores and levels of literacy proficiencies) of workers in each quartile of the index of reading skill use at work, and conversely, the authors present the use of reading skills at work by the level of literacy proficiencies of workers. The descriptive section also explores the connection between the occupation of workers and their use of reading skills at work. Findings from multivariate regression analyses that explore the links between earnings and the use of reading skills at work, with regression controls for literacy proficiencies, educational attainment, work experience, occupation, and demographics are presented. [For the previous report in the series, see "Skills and Labor Market Outcomes of Working-Age Americans. The Impact of Human Capital in the American Labor Market Series" (ED626553).]