Community Research and Development Information Service - CORDIS

ERC

Sorting Result In Brief

Project reference: 208068
Funded under: FP7-IDEAS-ERC
Country: Spain

How collective talent impacts productivity in the workplace

Highly skilled workers are much sought after in the workforce because they are more productive; but, does this productivity carry over when surrounded by equally competent co-workers? An EU initiative sought answers.
How collective talent impacts productivity in the workplace
To boost output and efficiency and meet demands for specialised training or skill sets, work environments of all shapes and sizes spend a tremendous amount of effort and resources in building a highly competent workforce or team. Attracting the best workers, bringing them all under one roof and paying them much more seems to be warranted, given that skilled labour creates significant economic value through human capital. However, economists have found no evidence to support such complementary effects on the economy overall.

The EU-funded SORTING (The role of sorting for estimation, market design and development) project set out to study the claim that employees are not necessarily more productive if they work with a team of highly skilled colleagues.

Project partners employed social security data to examine wages from the perspective of the individual worker and that of the workplace setting's characteristics. They did not find any notable link between the two, thus refuting evidence of any complementarities.

The SORTING team found that while working in a better firm does indeed boost worker productivity, it does not necessarily increase wages. What is more, a productive worker may earn less when seeking a job at a leading firm.

To deal with method bias, researchers proposed a solution for the correct inference of data. It is important to appropriately determine the strengths of the complementarities in order to be able to assess the shortfalls of teams that were unsuitably put together or resources that were improperly allocated.

SORTING has shed light on the degree to which assembling talented teams of workers impacts a competitive labour market and affects earnings and productivity.

Related information

Keywords

Productivity, workplace, highly skilled workers, workforce, SORTING
Record Number: 183116 / Last updated on: 2016-07-25
Domain: Industrial Technologies