Online MA in Economics Program Director Kara Reynolds presented on February 25, 2016 on the career outlook for graduates. She went into detail on the industries, job roles, and skills needed for the career as well as discussed best tips on landing an internship in the industry.
The following is a partial transcript of the archived presentation, which can be viewed here.
Dr. Kara Reynolds: One of the most important things you should consider when choosing a graduate program is what will be your return on investment. In order to help you make this calculation, today I am going to provide you with some information on the current career prospects for Economists, particularly those with an MA degree. I will then discuss one of the ways that you can prepare for your future career while in the Applied Economics program at American University—an internship. I will conclude with some advice on how to find and land a job (or internship) in the field of economics. Along the way, I will discuss more specifically the organizations in which our own alumni have found careers.
The Bureau of Labor Statistics releases updates to their Occupational Outlook Handbook each year with projections for employment opportunities in a broad range of different fields. According to their latest report, employment of economists is expected to growth 6 percent per year over the next 10 years. Although some positions are open to those with a BS or BA in Economics, the report notes that most entry level economist positions require candidates to hold an MA degree. The strongest growth will be for candidates who have strong quantitative skills and experience working with large datasets.
According to BLS statistics, the median annual salary for economists in 2014 was $95,710—however there is quite a bit of heterogeneity in this value. A recent National Association of Business Economists (NABE) survey found that the median entry level base salary was $58,000 for those holding an MA degree (compared with $50,000 for those holding a BA or BS degree). The median salary of those holding a BA or BS degree was $91,000, while those holding an MA degree was slightly over $100,000.
There has been a shift in recent years in the types of careers held by economists. Traditionally, one of the largest employers of economists was the federal government, a fact reflected in the career paths of our older alumni. Due to budget constraints, however, the growth in the federal workforce has been curtailed, and most of the growth in the field in recent years has occurred in the private sector. In particular, more and more private firms are relying on economists to analyze marketplace data and develop models to forecast economic trends.
That being said, one-fifth of all economists are employed in the federal government with positions across nearly all of the agencies. Our alumni are employed in the Bureau of Labor Statistics, Census Bureau, Federal Trade Commission, Food and Drug Administration, Department of Treasury, Overseas Private Investment Corporation and Federal Reserve Board (to name a few).
Another 20 percent of economists are employed as consultants (legal and business). Legal consultants may prepare economic evidence for court cases (including, for example, estimating damages), while business consultants may be charged with preparing business strategies for their firms.
Fifteen percent of economists are employed in research positions, including for think tanks like American Enterprise Institute or Urban Institute and agencies like the International Monetary Fund and World Bank. Many of these economists would be working on public policy related questions. Within the private sector, the top paying positions are those with the pharmaceutical industry, legal services and finance.
Geographic Concentration of Economists
In part because the federal government, think tanks, and organizations such as the IMF and World Bank employ so many economists in the Washington, DC area, slightly over one-third of all economists are employed in Washington, DC according to the Bureau of Labor Statistics Occupational Employment and Wages data. Other states with high concentrations of economist positions include California, Texas, Virginia and Massachusetts. Many of these positions are concentrated in urban areas like Boston, San Francisco, Houston, New York, Los Angeles and Chicago. As might be expected, the wages for economists in these areas with high demand also tends to be higher than other locales.
Key Skills for Economists
The Department of Economics has developed curriculum of the MA in Economics program to train students what I consider the three most important skills of the professional economist:
- Economists must be able to use of economic theory to make predictions or explain outcomes. Students in the program will complete a rigorous sequence of course work in microeconomic and macroeconomic theory, during which time they are trained to use theory to predict the impact of policy changes on individuals, markets, and the economy as a whole. For example, one of the assignments in the second course in the program, Microeconomic Theory, asks students to use the “theory of the firm” to predict what impact the Affordable Care Act (Obama Care) should have on the use of full versus part-time work. Students will continue to work on these critical thinking skills in their subsequent classes.
- Economists must be able to use econometrics (and data analysis more generally) to answer questions rigorously. Students take a two course sequence in econometrics, during which time they will become proficient in one of the leading statistical packages in use today (Stata). In subsequent electives and their capstone project, students will hone both their ability to find and “clean” data, and their econometric skills.
- Economists must be able to communicate economic analysis to a wide audience of economists and non-economists alike—both in written papers and oral presentations or testimony. Throughout the program, students will gain experience effectively communicating their analysis both verbally and graphically.
Here are two specific examples the career paths of two of our alumni.
- Even prior to graduating in 2011, Sydney Gourlay was able secure a long-term contract position with the World Bank as a Survey Specialist. Sydney had previously been employed with the United Nations, but decided to return to graduate school in order to move out of purely administrative tasks and into more satisfying work in the field of development economics. Project evaluation is really essential to figuring out which projects are worth continuing and which should be scrapped in favor of those with more successful outcomes, and it is more challenging than you might think. For example, if a farmer who participates in World Bank sponsored program produces 20 percent more than his neighbors is it because of the program or because the farmer is happens to be more productive than his neighbors? Sydney’s primary activities at the World Bank include designing surveys and research experiments that can be used to evaluate particular policies in individual developing countries. She also has had the opportunity supervise these experiments in the field. Although Sydney continues to work part-time for the Bank, she has decided to advance her career by returning to American to get her Ph.D.
- John Taylor graduated in 2005, and has since been employed in a number of consulting firms, first in the energy sector (focusing mostly on regulatory issues) and then in the finance sector. As a consultant, John prepares expert testimony on the impact of various regulations on consumers and individual firms. Consultants such as John might be asked to apply economic theory and data analysis to answer such questions as (1) how should the government define a particular “market” (where that definition might be either a product or geographic definition), (2) how competitive is that market (can firms easily enter the market? What are the typical profit margins in the industry) and (3) what would happen to the level of competition (including price) in the face of policy shocks or mergers or acquisitions.
Both alumni ended up in positions that highlight the strengths of AU’s program, namely our faculty. In part because of our location, our faculty’s research interests are primarily driven by applied, policy oriented questions across a variety of fields. For example, my work is primarily on the impact of various forms on trade protection on the economy. Prof. Walter Park, who also teaches in the program, is interested in the role of intellectual property rights protections on various outcomes. Prof. Mary Hansen has studied questions relating to how to best serve children in foster care. We bring these policy related questions into the classroom as much as possible, and our alumni are ready to step into positions where they have to answer these policy related questions using economic theory and data analysis.
One way to gain valuable work experience while in the MA program is by participating in the internship program. Students can register for 3 elective credits in the internship program. To earn credit, student need to work at least 27 hours per week in the 8 week term, participate in weekly discussions on their experiences, and write a research paper integrating their academic studies with their internship.
Two great examples include a recent MA student who interned with the American Bankers Association, where he wrote an analysis of how the Dodd-Frank legislation would impact the lending industry. Another student who interned at the International Food Policy and Research Institute actually travelled to Uganda to help with field research evaluating the impact of tenure status and titling on access to credit by rural household. A third student interned at the Bureau of Industry and Security within the Department of Commerce. In this position, the student conducted an assessment of the machine tool industry to examine the sensitivity of technologies that are dual-use (i.e., have both civilian and military applications) and evaluated the scope for U.S. export controls in this industry.
Sixty-two percent of our MA students take an internship for credit as part of their program. Other locations we have placed students include the InterAmerican Development Bank, American Enterprise Institute, Comptroller of the Currency and State Department.
Interning – Learning Objectives
Students participating in AU’s internship program are mentored both at work and by Department faculty. All internships have to be approved by our internship coordinator to ensure that students will not be doing administrative work, but rather are gaining valuable experience in their field. Students will get the opportunity to collect data to analyze issues facing the organization. Faculty supervisors help the students link the real world issues facing their organization to the analytical frameworks and economic theory learned in the classroom. Students will also get experience conducting empirical analysis – if not in a task assigned to them by their organization than in a paper supervised by our internship coordinator.
Finding a Job In Economics
Students are tasked with finding their own internship or job following graduation, but the Department and University provides resources that can help.
One fantastic resource is AU’s Career Center. The University’s Career Web includes a job bank of positions specifically for AU students and alumni, and candidates can in some cases apply right through the system. You can search the bank by location, field, level of experience, and major. The Career Web also allows you to register for campus wide recruitment events and conduct industry, occupation or firm research.
I also encourage students to make an appointment with a Career Center advisor, which can be done through Skype for those students not on campus. Advisors can help with your resume or cover letter. They are very knowledgeable about networking opportunities and building your online professional profile in such platforms as Linked In. You can also use the career center to prepare for an interview, either with a live advisor or virtually using a webcam and a tool called “Interview Stream.” Career Center employees are particularly adept at navigating the federal hiring process for those interested.
The department administers a Linked In group for our alumni to allow students to keep in touch with their classmates, or make connections with alumni from other cohorts. I post job openings in the site (and I encourage alumni to similar posts career opportunities that they become aware of). I e-mail entry-level or internship opportunities to current students. And talk to faculty members about what you are looking for—they often have connections that may help.
I recommend to all students that they consider joining professional organizations, particularly when they are still students and the fees are nominal. One organization that is particularly active in the private sector is the National Association of Business Economists, which has its own job bank and holds career fairs each year in cities such as Washington, DC, Boston or New York. The Society for Government Economists is more active in the Washington, DC area, and has great networking luncheons year round. Nearly all academic economists belong to the American Economic Association (AEA) which runs the “Job Openings for Economists” (or JOE). Most of the positions in these listings are for more senior economists, or new PhDs, but browsing the site will give you some ideas about career potential.
The first stepping in getting a job as an economist is landing an interview. I just served on the search committee in our own search for two economists, and I cannot emphasize enough the importance of both your resume AND cover letter. While many applicants clearly spend a great deal of time revising their resume, I believe too little time is spent on the cover letter.
I encourage you to highlight as much as possible the key skills (i.e. critical thinking, quantitative analysis) of economists in both your resume and cover letter. Your cover letter should also use language specific to the job description, and provide more detail about your qualifications. Don’t repeat your resume (keep you letter to one page!) but provide more detail. I encourage our students to discuss a research project that can demonstrate your expertise—the capstone paper is really designed for this purpose. You can go into detail regarding the data, method of analysis, and your findings.
American University’s Master’s Graduates in Economics
To wrap up, let me highlight some of the statistics that I am particular proud of. Ninety-seven percent of MA alumni are employed or pursuing graduate degrees within six months from graduation. Of these about half are working for the federal government, slightly over 20 percent are working in non-profits, including think tanks and development organizations, and 30 percent are working in the private sector.
Leading employers of our graduates include the Federal Reserve Board, Deloitte, JP Morgan Chase, the Department of Justice, and the International Monetary Fund.
Given the growth potential in the field, and the strength of our program, I am confident that such success rates will continue in the future.
To learn more about American University’s online Master of Arts Economics, Applied Economics specialization, request more information or call us toll free at 855-725-7614.