Good Personality Traits in Bad Times : Does Conscientiousness Mitigate the Adverse Effects of Graduating in a Recession?

This paper studies whether and how Conscientiousness, a personality trait, helps individuals mitigate the adverse effects of graduating during a recession on early career outcomes. By analyzing college-educated individuals who graduated in the 1980s, we find that Conscientiousness reduces the income losses of workers who graduated during a recession. This mitigation effect results from both smaller wage losses and worker adjustments in the labor supply. When graduating during a recession, workers high in Conscientiousness earn higher wages, try harder to find full-time jobs, and work more hours compared to their counterparts low in Conscientiousness. In contrast, we do not find evidence showing that cognitive ability helps individuals mitigate these adverse effects of graduating in a recession