Purpose The authors explored the effect of college student leader experience on students' employment prospects, such as their starting salary. The authors also examined the factors behind being a student leader and the set of skills that foster the effect of leadership experience. Design/methodology/approach Using an empirical panel survey, the authors collected data from 3,361 undergraduate students over five consecutive years in China, which were analysed using different econometric methods. Findings The starting salary premium associated with student leaders' experiences was approximately 7%. Individual learning, problem-solving, and interpersonal skills were mediating variables that replaced half of the wage premium effect of the student leader. Family background and types of educational experiences were associated with being a student leader and labour market outcomes. Research limitations/implications The authors only explored a few leadership-related employability skills; other relevant skills require consideration. Practical implications This study informs students, parents, and higher education institutions (HEIs) by clarifying the importance of leadership development. An effective transition from higher education to the labour market should be emphasised. Social implications Higher education educators should provide guidance to student organisations and promote formal and informal student leadership education to all students. Originality/value The authors revealed some factors that promote student leadership and how they are associated with labour market outcomes in China. The authors also verified and validated the capital improvement channel for some specific leadership-related skills to explain the effect of student leader experience on employment outcomes.