Feb 16, 2023
The Biggest Earners May Not Be the Smartest Workers, Study Says
(Bloomberg) -- It pays to be smart, or so the saying goes. But the biggest earners may not be the workers who are the brainiest, according to one recent Swedish study.
The research, published in the European Sociological Review in January, found that higher general intelligence was correlated to higher wages—but only up to a threshold of about 600,000 Swedish krona ($57,300) a year. Beyond that point, the study found that ability plateaus as wages continue to rise. And earners in the top 1% score slightly worse than those in the income tier directly below them.
“We find no evidence that those with top jobs that pay extraordinary wages are more deserving than those who earn only half those wages,” wrote the authors of the study, which was led by Marc Keuschnigg, a senior associate professor for analytical sociology at Linköping University in Sweden.
“Extreme occupational success is more likely driven by family resources or luck than by ability,” the authors added.
The study analyzed the cognitive ability of 59,387 Swedish-born men at the age of 18 or 19 and their earnings during an 11-year window between the ages of 35 and 45. The research was based on a standardized intelligence test the men took as part of compulsory military service, which included tests of verbal understanding, technical comprehension, spatial ability and logic.
Women and immigrants were not included in the study because military service was not mandatory for those groups between 1971-77 and 1980-99, when the initial data were recorded.
The research doesn’t account for non-cognitive abilities—such as motivation levels or superior social skills—that may help workers score high-paying jobs. The study’s authors also acknowledge other limitations to their work: For instance, the smartest people may not always opt for the highest-paying job over a more interesting or rewarding role. (Academia, they note, is “neither the best-paid nor the most prestigious professional field.”)
Still, Keuschnigg sees the lack of a correlation between intelligence and salary at high levels as a warning sign about growing income inequality between the most wealthy and the rest of society. Given that Sweden has a relatively narrow income gap, “we can speculate that we might see this even more in places like Singapore or the US,” he said.
“The decisions that top earners make are consequential for a lot of people,” he added. “So we as a society might want to have the right people in these top positions.”
--With assistance from Michelle Fay Cortez.
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