As we move into the era of “big data,” the time has never been better to start a career in Economics. According to the Bureau of Labor Statistics, there are currently 17,000 economists employed in the United States, and employment in the industry is projected to grow 14 percent over the next 10 years. As you begin planning for your Economics career, it is important to think about what kind of training you may need and what kind of positions will be available to you once you complete that training. Here are some important facts that you should know.
Economists Find Employment in a Variety of Industries
Historically, the bulk of economists have worked in the public sector. Currently the public sector employs 44 percent of economists in the United States, while the federal government alone employs nearly 30 percent of all U.S. economists. However, because the federal government is under increasing pressure to downsize, employment opportunities for economists in the public sector is projected to be fairly flat over the next ten years. Instead, most growth in the profession is projected to take place in the private sector. Here is a description of the tasks undertaken by economists in a variety of fields:
- The Public Sector. Government economists at such agencies as the Federal Reserve Board, Bureau of Labor Statistics, and the Bureau of Economic Analysis collect and analyze data about the U.S. and world economy. They may be tasked with projecting spending needs by their agency or with analyzing the economic impact of laws and regulations on economic welfare. Economists at the State Department and Central Intelligence Agency focus more on analyzing economic conditions overseas. In some agencies such as the Department of Justice or Federal Trade Commission, economists contribute to the enforcement of laws such as federal antitrust or consumer protection laws. State and local governments also hire economists for many of these same tasks.
- Private Corporations. Economists employed by corporations are tasked with helping management understand how the economy will affect their business. For example, they may be asked to analyze consumer demand for their products or the competitive conditions in their industry in order to help design pricing or investment strategies.
- Consulting Firms. Economists employed by consulting firms such as Ernst & Young or Bates White use applied economics and data analysis to assist their clients with such things as litigation support, forecasting, and risk management. Analysts with consulting firms work with data, develop models of specific markets, and provide testimony in public hearings and in lawsuits.
- Research Firms and Think Tanks. Economists in research firms and think tanks such as the Urban Institute or Brookings Institute study and analyze a variety of economic issues such as the impact of various proposed or implemented policies on societal welfare. The analyses undertaken by these organizations are cited in newspapers and congressional testimony and published in journal articles or books.
- International Organizations. International organizations such as the World Bank, International Monetary Fund, and United Nations employ a large workforce of economists to undertake economic analysis on a variety of issues. Although senior research positions at these organizations are typically held by those with a Ph.D. in Economics, those with a MA degree can be employed in such programs as the World Bank’s Young Professional or Junior Professional Associates Programs.
An Economics Graduate Degree is Increasingly Important in the Industry
Historically, candidates with just a bachelor’s degree in economics could be employed in entry level economist positions, particularly in the federal government. However, as growth in public sector employment of economists has slowed, candidates increasingly need an advanced degree in economics to be competitive for entry level positions. According to the National Association of Business Economists (NABE) 2012 Survey, 47 percent of organizations in their sample required at least a Master degree in Economics to be considered for an entry level position.
Salary levels also vary significantly based on your level of education. According to the NABE survey referenced above, the median starting salary for entry-level economists was $66,250. However, those with an advanced degree earned significantly more: the median entry level wage for those with a bachelor’s degree was $50,000 compared to $60,000 for those with a Master level degree in Economics. Note that as you gain experience, your salary will also increase. According to the Bureau of Labor Statistics, the median annual salary for economists in 2012 was $91,860.
What Skills Do Economists Need Today?
A senior level official at the Federal Reserve Board recently told our students that when applying for a job as an economist, students too often focus on what they have learned. Instead, she recommended that job candidates emphasize what they can do. A good MA program in economics should be designed to teach you the skills that you need to succeed as a professional economist. For example, economists need strong critical-thinking skills in order to apply economic theory to accurately make predictions or develop hypotheses. They need strong quantitative and analytical skills to be able to determine the best way to analyze a dataset in order to answer a question or test a hypothesis. And they need to be able to communicate their methodologies and findings in a clear, concise way to an audience of non-economists.
These are the skills that students will master during the MA in Applied Economics at American University. Students start the program with a course in the mathematical tools typically used by professional economists. They then move on to a two course-sequence in economic theory which emphasizes applied, policy-oriented analysis. For example, in Microeconomic Theory students are tasked with using economic theory to make predictions as to what impact the Affordable Care Act (or Obama Care) will have on full-time employment in the United States. Once students have mastered basic micro and macroeconomic theory, they undertake a two course sequence in Econometrics, during which time they will learn state of the art methods to analyze data and develop essential programming skills in one of the most popular statistical packages used today, Stata. During their electives, students will continue to apply these data analysis and critical thinking skills to a variety of applied topics, such as economic development and the analysis of labor markets, while also perfecting their ability to explain economics to a variety of audiences. The program culminates with a Capstone in which students are tasked with undertaking their own significant research project under the supervision of one of our faculty members.
The decision to undertake a graduate program should not be undertaken lightly, but I believe that in today’s increasingly competitive job market the quantitative and analytical skills you will gain from our MA in Economics will give you the edge you need to find employment in the industries described above.
A Career as an Economist
Economics Career Webinar with Dr. Kara Reynolds
American Economic Association, "Careers," on the Internet at https://www.aeaweb.org/students/Careers.php.
Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2014-15 Edition, Economists, on the Internet at http://www.bls.gov/ooh/life-physical-and-social-science/economists.htm.
National Association of Business Economists, “Business Economics Career Center,” on the Internet at http://www.nabe.com/careers.
To learn more about American University’s online MA in Economics, request more information or call us toll free at 855-725-7614.