Careers
What careers follow the economics baccalaureate?
Economics majors are successful in a wide variety of careers. Although various roles in businesses are most common, economics majors are successful in law, medicine, government, non-profits, and international relations, as well as in academic roles.
Career Earnings
One way to think about career opportunities is to consider the level of earnings typically found with different levels and kinds of education in different careers.
The Corporate World & the MBA
Most economics majors pursue employment in the private sector. Graduates in economics succeed in many occupations. Some students plan to earn the Masters of Business Administration (MBA) degree in time. Others find employment with the BA is sufficient to fulfill their aspirations.
Economic Consulting
Some economists with BA degrees find employment as research associates with economic consulting firms. Consultants advise firms on business strategies, prepare economic evidence for court cases, and develop analyses to influence public policy.
Law and Other Professions
Law school is also a common destination for recent graduates in economics. The careful reasoning in economics is a good fit for law and many careers in the law influence significant economic decisions for firms.
Government and Not-for-profits
Some students enter government service or choose jobs with non-profit entities. Governments at every level hire economists for their facility with statistics and analysis.
Professors, Teachers and Researchers of Economics
Some graduates in economics are interested in academic careers. They are drawn by the love of the study of economics and the prospect of teaching and writing about economics as a career.
The Department of Economics at the University of Wisconsin provides a list of websites for searching for jobs and internships.
Career Earnings
The US Bureau of Labor Statistics, Occupational Outlook Handbook (online in 2013) reports annual wages for economists in 2010. For economists of all educational levels, the median earnings in 2010 were $89,450 with $48,250 at the tenth percentile and $155,490 at the 90th percentile. Source: Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2012-13 Edition, Economists, on the Internet at http://www.bls.gov/ooh/life-physical-and-social-science/economists.htm (visited March 24, 2013).
Payscale.com reports its survey of people with Baccalaureate degrees (and no more) who are employed full time, showing starting salaries (typically with two-years of experience) and mid-career annual earnings. Here are selected occupations for the 2012-13 report.
|
College Major |
Starting Salary |
Mid-career Salary |
|
Chemical Engineering |
$67,500 |
$111,000 |
|
Applied Mathematics |
$50,800 |
$102,000 |
|
Statistics |
$49,300 |
$99,500 |
|
Economics |
$48,500 |
$94,900 |
|
Mathematics |
$48,500 |
$85,800 |
|
Finance |
$47,700 |
$85,400 |
|
Business |
$41,400 |
$70,000 |
|
Political Science |
$40,300 |
$74,700 |
|
Advertising |
$37,800 |
$77,100 |
|
Sociology |
$36,000 |
$56,700 |
|
Psychology |
$35,200 |
$60,200 |
Source: http://www.payscale.com/college-salary-report-2013/majors-that-pay-you-back
Median earnings of economists by highest level of degree for persons of all ages observed in 2003 are given in the table below by gender.
| Highest Degree |
Men
|
Women
|
| BA | $65,000 | $49,000 |
| MA | $80,000 | $60,000 |
| PhD | $96,000 | $83,500 |
Source: Source: Nathan E. Bell, Nicole M. Di Fabio, and Lisa M. Frehill, “Salaries of Scientists, Engineers and Technicians: A Summary of Salary Surveys.” The Commission on Professionals in Science and Technology (CPST: Washington, DC 2007) selected curricula from pages 41, 43, and 48.
Information about lifetime earnings associated with different education programs comes from surveys that follow the same people over many years. A first wave of questions might come in college to gather details about major and background. A second wave might come a few years after college to collect information about post baccalaureate studies and first jobs. Third and fourth waves come a decade and more later to track earnings later in life. The Bureau of Labor Statistics and other groups conduct national surveys of this kind every decade or so. Although the most recent survey is a decade old, it shows that economics majors with the BA continue to compare well with other majors at mid-career. [Daniel E. Hecker, "Earnings of College Graduates: Women Compared with Men," Monthly Labor Review, 121 #3, March 1998, pp. 62-71].
Mid-Career Earnings
The Center on Education and the Workforce at Georgetown University report the median earnings of adults working full-time for a full-year whose education stopped with the bachelor’s degree. The data below report earnings by college major using data from the American Community Survey 2009 from the Bureau of the Census for selected majors by gender and also reports the percentage with graduate degrees.
Anthony P. Carnevale - Jeff Strohl - Michelle Melton
The Economic Value of College Majors
Georgetown University, Center on Education and the Workforce
http://cew.georgetown.edu/whatsitworth/
|
|
Median Earnings with BA or BS |
Percent with |
|
|
|
Female |
Male |
Graduate Degree |
|
Social Science |
|||
|
Economics |
$57,000 |
$74,000 |
40 |
|
Political Science & Government |
$49,000 |
$63,000 |
47 |
|
Psychology |
$41,000 |
$53,000 |
43 |
|
Sociology |
$42,000 |
$54,000 |
34 |
|
Business |
|||
|
Accounting |
$55,000 |
$75,000 |
24 |
|
Finance |
$52,000 |
$70,000 |
26 |
|
Management |
$50,000 |
$64,000 |
20 |
|
Marketing |
$48,000 |
$65,000 |
14 |
|
Engineering |
|||
|
Architecture |
$55,000 |
$65,000 |
32 |
|
Chemical Engineering |
$72,000 |
$92,000 |
45 |
|
Civil Engineering |
$62,000 |
$80,000 |
35 |
|
Electrical Engineering |
$70,000 |
$86,000 |
42 |
|
Mathematics & Computers |
|||
|
Computer Science |
$70,000 |
$79,000 |
28 |
|
Mathematics |
$54,000 |
$75,000 |
47 |
Corporate World & The MBA
Although the economics major does not provide training for specific occupations, it provides the logical structure that pays off in understanding the big picture, the context for entering several fields in the corporate world. Its emphasis on logical thought and problem solving skills has universal value. Many employers seek to hire graduates with these skills.
Some students aspire to earn Master of Business Administration (MBA) degrees, typically expecting to complete a two-year program in a graduate business school. Leading MBA programs expect applicants to have had several years of significant business experience before enrolling. The average age of students entering top MBA programs is 27 years. Business Week provides an online guide to MBA programs as does Peterson’s, BusinessDegreeOnline, and a number of others.
The better MBA programs give some preference in admission to applicants with technical backgrounds including engineering, physics & math, and economics. Some areas of study in business like finance use a significant amount of mathematics. Undergraduate study in business then is not a primary or even necessarily a desirable path to an MBA. Of course, people who have developed their own successful businesses or enjoyed considerable success in other ways also tend to be attractive to MBA recruiters. The schools value success in many forms.
Students intent on careers as managers often seek a strong, general education. They want to learn effective communication skills, to develop habits of logical thought, and to practice their problem solving skills. Many undergraduate programs do this well; economics is often particularly effective.
In addition to careers as general managers and entrepreneurs, economics majors also often pursue careers in specific occupations common to the corporate world. Economics majors with the BA degree find jobs in the financial world, in marketing, and consulting. Some pursue one-year post baccalaureate programs for entry into a target career. The Master of Accountancy (MAc), for example, will launch an accounting career and go a long way toward completion of requirements for the Certified Public Accountant title.
Students who have a specific occupational goal will often do well in enrolling in a program of training specific for that occupation. For example, accounting majors readily get jobs as accountants on completing a BA. Finance majors have a good chance of being employed as financial analysts or budget officers. The broader horizons of the economics major are certainly not for everyone.
Economic Consulting
Economics graduates with good analytic and communication skills find employment with consulting firms. McKinsey & Company, Boston Consulting Group, Bain & Company, Accenture, Charles Rivers Associates, Mathematica Policy Research, and NERA Economic Consulting are examples. Analysts with consulting firms often work with data, develop models of specific markets, and provide testimony in public hearings and in lawsuits. Many graduates find that a few years experience with a consulting firm is a good lead into an MBA, law program, or graduate study in economics. Many consulting firms invite application for employment through their websites.
Law and Other Professions
The economics major is one of many common paths to law school. The Law School Admission Council provides the official guide to law schools for the American Bar Association. The Guide emphasizes extensive reading and library research, skill in synthesizing large amounts of information, and logical thinking. In addition to general skills, the Guide points to breadth of knowledge of history, politics, finance, human behavior, and diverse cultures.
Many careers in law involve shaping economic decisions. Writing and interpreting contracts, supporting mergers and acquisitions, dealing with the tax system, addressing disputes of workers, landlords, and vendors; all involve decisions with significant economic content and implications.
A recent analysis of scores on the LSAT test for law school admission reported for students who apply to at least one ABA accredited law school shows economic majors earned relatively high mean LSAT scores as shown in table 2. The LSAT score ranges from 120 to 180 with mean and median near 152. The first quartile is near 144 and the third quartile is near 157. The LSAT score along with undergraduate grade point average and the quality of the undergraduate college are important influences in the admissions decisions of competitive law schools. [Michael Nieswiadomy, "LSAT Scores of Economics Majors: The 2003-04 Class Update," Journal of Economic Education 37 #2, Spring 2006. Pp. 244-7. Available in JSTOR]
Table 2: Average LSAT Scores by Major, 2002-03.
|
Rank
|
Major
|
LSAT score
|
# of takers
|
|
1
|
Economics |
156.6
|
4,163
|
|
2
|
Engineering |
155.4
|
3,367
|
|
3
|
History |
155.0
|
4,716
|
|
4
|
English |
154.3
|
6,265
|
|
5
|
Finance |
152.6
|
3,492
|
|
6
|
Political Science |
152.1
|
15,023
|
|
7
|
Psychology |
152.1
|
5,164
|
|
8
|
Criminal Justice |
144.7
|
3,433
|
|
|
Total (all categories) |
152.2
|
94,391
|
Source: adapted from Nieswiadomy as in text.
Among the eight disciplines with more than 3,000 students taking the LSAT, the 4,163 economics majors received the highest average score at 156.6 as shown in the table. Looking more broadly at majors or groups of similar majors with at least 700 takers, economics ranked third behind physics/math (723 takers with mean 158.9) and philosophy/religion (2,410 takers with mean 157.4).
Some economics majors enroll in medical and dental programs by adding enough science courses to their undergraduate career to qualify for admission. Many undergraduate economics programs include courses on health economics and students often report that the physicians like talking about economic policy issues when they interview applicants to their medical schools.
Government and Not-for-profits
Governments at every level hire economists to manage and evaluate their operations. The Office of Personnel Management (OPM) of the Federal government provides information about Federal employment opportunities. Their USAJobs site lists thousands of openings of all kinds in many locations across the country. Search on "economist" to find information about specific current opportunities. There are often openings for economists with BA, MA, and PhD degrees.
The OPM website also gives general information about Federal pay scales. BA economists with little experience are (to simplify a bit) at grade GS-7, with MAs at GS-9, and new PhDs start at GS-12. Although pay does differ with the cost of living in different locations, BA economists started at $31,209 or above in 2006.
The Federal Reserve Board and its affiliated regional Federal Reserve Banks also hire economists and research assistants at various levels of education. Skill with statistics and in managing data will be helpful for many entry jobs.
Economists are valued in the Foreign Service and civil service in the State Department, and as analysts with the Central Intelligence Agency.
State governments have similar websites that list public service jobs with pay scales and application procedures. Searching the Internet for "state employment" will usually yield an appropriate link.
International agencies of many kinds hire economists for a variety of roles. Additional languages, strong communication skills, experience with diverse cultures, and statistical skills are often important. The World Bank, for example, offers jobs for economists. The Bank has an internship program as well.
One way to learn about employment with non-profits is to go to the Idealist website and look for roles in economic development or other areas of interest.
Professors, Teachers and Researchers of Economics
The Doctor of Philosophy degree (PhD) in economics is necessary for a faculty position in economics at most four-year colleges in the US. A masters degree is the typical credential for faculty at two-year colleges. Although some students complete masters programs before entering PhD programs, many go directly from BA programs into PhD programs. Completion of a PhD requires about six years of full-time study. See the AEA website for information about graduate study. Holders of the Ph.D. often also choose research careers outside of academics, including roles at the Federal Reserve, international agencies, and government policy and evaluation departments as well as in private banks, investment houses, and other for-profit ventures
There are about 100 universities in the US who together produce about 1,000 new PhDs each year. About half of the graduates are US citizens and the other half come from abroad. [John J. Siegfried and Wendy A. Stock, "The Undergraduate Origins of Ph. D. Economists," Working Paper, May 2006] Although the number of economics majors has grown significantly over the decades, the number of new PhDs who intend to pursue careers in the US has declined. As a consequence, employment opportunities for PhD economists in academia should be excellent in the decades ahead.
The Commission on Professionals in Science Technology (mentioned above, page 8) reports starting salaries for assistant professors by field. At $78,567, economics is well above the average of $65,205 of all fields in 2006-07. The table below reports average salary offers to newly hired economists at each academic rank by type of institution.
Average Academic Salary Offers for Senior Level Economists by Rank and Type of Institution, 2006-07
| Rank of Academic Economist |
All PhD Granting Institutions
|
BA & MA Institutions
|
| Senior Assistant Professor | $95,995 | $80,167 |
| Associate Professor with Tenure | $128,600 | $82,333 |
| Full Professor | $204,800 | $97,500 |
Source: Nathan E. Bell, Nicole M. Di Fabio, and Lisa M. Frehill, “Salaries of Scientists, Engineers and Technicians: A Summary of Salary Surveys.” The Commission on Professionals in Science and Technology (CPST: Washington, DC 2007) selected curricula from page 268.
Academic economists at PhD granting institutions play leading roles in the development of new ideas in economics and publish their work in the journals and books mentioned on the publications page. As teachers, economists play an important role in supporting the undergraduate major in economics and the various graduate programs.
A number of PhD economists hold faculty positions in MBA programs, law and medical schools, public policy programs, and in a number of other fields. Economists on the faculty of leading professional schools often earn premium salaries.
A number of for-profit and not-for-profit enterprises hire research economists as do many government and international agencies. The National Association of Business Economics provides information about business careers for economists. The career sites for government and not-for-profits mentioned above also point to opportunities for researchers.
Current job openings for economists in academia and with some other employers appears in JOE, Job Openings in Economics. Most of the jobs listed in JOE require graduate study in economics.