The Marginal Productivity of an Additional Line in your Resume

One of the assumptions that economists use very often is the “diminishing returns to scale” assumption, which means that each additional worker in your factory (keeping constant the number of machines) helps to increase your output but in a smaller amount that the worker that joined before him. For instance, if you have a guitar factory with 1 machine, your first worker will be able to produce 10 guitars. When you hire an additional worker, you will be able to produce in total 18 guitars, and when you hire a 3rd one, in total you’ll be able to produce 25 guitars. this means that each worker contributes to the total output, but the contribution gets smaller and smaller (the first worker contributed with 10 guitars, the second with 8 and the third with 7). This is, labor has diminishing returns to scale.

The fact is that many other things in life behave like this. For example, your curriculum vitae (CV). We all agree that your resume is a signaling device. You send your resume to many places when you are searching for a job, to convince the people to call you and to invite you to an interview. Clearly, they cannot get to know you through your CV, but if you are able to draw their attention such that they will call you for an interview, the signal accomplished its goal. Why is it a signal? Well, you generally know better than your prospective employer what kind of worker are you: if you are a bit lazy, or if you are really hard-worker. In any case, the way that you reveal them your “type” or personality is through signals, which is your CV: the education you acquired, the awards you received, previous experience, and so on. In addition, you also don’t know what is the exact kind of worker that the employer is looking for, so you want to give the appropriate signals.

The big question is, what to write? So, the first thing you should understand is that you are constrained in space. You cannot hand in a CV that has every little thing you did in your life, but you must choose the best signals to fit one page, maximum!

So let’s assume that you are applying for a position which you believe diversity is welcomed – which means that they want to see your education, some work experience, some awards maybe, some publications, some voluntary activities… in other words: everything is valuable you think! How do you put all that in one page?

Here it were the diminishing marginal productivity story comes. Let’s say you were very successful in your previous job, and you want to emphasize at least 10 different projects you were managing in a leadership position. On the other hand, you want to write on your education all the courses you took on math, because you believe they are relevant to the position. If you do that, then you are already above the one page constraint. So your formula to solve this problem is the following:

The marginal productivity of an additional line of one section (say education) must be equal to the opportunity cost of not adding another line in another section (say, work experience). This means that you keep adding lines in education, until you realize that the “cost” of not using that same line on another category of your life is higher than the marginal contribution of the additional education line. This will always happen at some point, because the marginal contribution of each line is decreasing within each section. You don’t have to write all your math classes, but you will write the most relevant one, or the top 3, because each additional course is not saying something very different about you, and you would prefer to use that line to signal about another skill which is not math.

It would be a shame if the employer doesn’t know about your leadership skills because you wanted to write 10 math courses, instead of the most important one. If you leave your leadership experiences aside, so then your prospective employers won’t know anything about your leadership skills and your ability to teamwork which are far more important for the employer than your 5th or 6th math course in the list.The bottom line is that, once you write down your top three courses of math, the employer will understand that you are good at it. Don’t waste an additional line on that, when you can use that very same space to accentuate another skill that will make your curriculum more attractive.

Employers usually don’t have time to read all the CVs, so one should be very strategic on signaling correctly, and not to use two lines for signaling the same skill. The opportunity cost of that line is higher than the marginal contribution of repeating a skill.