This paper examines the relationship between individuals’ skills and labor market outcomes
for the working-age population of Colombia’s urban areas. Using a 2012 unique household
survey, the paper finds that cognitive skills (aptitudes to perform mental tasks such as
comprehension or reasoning) and socio-emotional skills (personality traits and behaviors)
matter for favorable labor market outcomes in the Colombian context, although they have
distinct roles. Cognitive skills are greatly associated with higher earnings and holding a
formal job or a high-qualified occupation. By contrast, socio-emotional skills appear to have
little direct influence on these outcomes, but play a stronger role in labor market participation.
Both types of skills, especially cognitive skills, are largely associated with pursuing tertiary
education. The analysis applies standard econometric techniques as a benchmark and
structural estimations to correct for the measurement error of skill constructs.