Nature of the Work
Economists study the ways a society uses scarce resources such
as land, labor, raw materials, and machinery to produce goods
and services. They analyze the costs and benefits of distributing
and consuming these goods and services. Economists conduct research,
collect and analyze data, monitor economic trends, and develop
forecasts. Their research might focus on topics such as energy
costs, inflation, interest rates, farm prices, rents, imports,
or employment.
Most economists are concerned with practical applications of economic
policy in a particular area, such as finance, labor, agriculture,
transportation, real estate, environment, natural resources, energy,
or health. They use their understanding of economic relationships
to advise business firms, insurance companies, banks, securities
firms, industry and trade associations, labor unions, government
agencies, and others. On the other hand, economists who are primarily
theoreticians may use mathematical models to develop theories
on the causes of business cycles and inflation, or the effects
of unemployment and tax legislation.
Depending on the topic under study, economists devise methods
and procedures for obtaining the data they need. For example,
sampling techniques may be used to conduct a survey, and econometric
modeling techniques may be used to develop forecasts. Preparing
reports usually is an important part of the economist's job. He
or she may be called upon to review and analyze all the relevant
data, prepare tables and charts, and write up the results in clear,
concise language. Being able to present economic and statistical
concepts in a meaningful way is particularly important for economists
whose research is policy directed.
Economists who work for government agencies assess economic conditions
in the United States and abroad and estimate the economic effects
of specific changes in legislation or public policy. For example,
they may study how the dollar's fluctuation against foreign currencies
affects import and export markets. Most government economists
are in the fields of agriculture, business, finance, labor, transportation,
utilities, urban economics, or international trade. Economists
in the U.S. Department of Commerce study domestic production,
distribution, and consumption of commodities or services; those
in the Federal Trade Commission prepare industry analyses to assist
in enforcing Federal statutes designed to eliminate unfair, deceptive,
or monopolistic practices in interstate commerce; and those in
the Bureau of Labor Statistics analyze data on prices, wages,
employment, productivity, and safety and health. An economist
working for a state or local government might analyze regional
or local data on trade and commerce, industrial and commercial
growth, and employment and unemployment, and project labor force
trends.
Working Conditions
Economists working for government agencies and private firms have
structured work schedules. They may work alone writing reports,
preparing statistical charts, and using computers and calculators.
Or they may be an integral part of a research team. Most work
under pressure of deadlines and tight schedules, and sometimes
must work overtime. Their routine may be interrupted by special
requests for data, letters, meetings, or conferences. Travel may
be necessary to collect data or attend conferences.
Economics faculty have flexible work schedules, and may divide
their time among teaching, research, consulting, and administration.
Employment
Economists and marketing research analysts held about 51,000 jobs
in 1992. Private industry particularly economic and marketing
research firms, management consulting firms, banks, securities
and commodities brokers, and computer and data processing companies
employed 7 out of 10 salaried workers. The remainder, primarily
economists, were employed by a wide range of government agencies,
primarily in the Federal Government. The Departments of State,
Labor, Agriculture, and Commerce are the largest Federal employers
of economists. A number of economists combine a full-time job
in government or business with part-time or consulting work in
academia or another setting.
Employment of economists analysts is concentrated in large cities
for example, New York City, Washington, D.C., and Chicago. Some
economists work abroad for companies with major international
operations; for the Department of State and other U.S. Government
agencies; and for international organizations, including the World
Bank and the United Nations.
Besides the jobs described above, many economists held economics
faculty positions in colleges and universities.
Training, Other Qualifications, and Advancement
A bachelor's degree with a major in economics is sufficient for
many entry-level research, administrative, management trainee,
and sales jobs. Economics majors can choose from a variety of
courses, ranging from those which are intensely mathematical like
microeconomics, macroeconomics, and econometrics, to more philosophical
courses like the history of economic thought. Because of the importance
of quantitative skills to economists, courses in mathematics,
statistics, econometrics, sampling theory and survey design, and
computer science are highly recommended.
Aspiring economists can gain experience gathering and analyzing
data, conducting interviews or surveys, and writing reports on
their findings while in college. This experience can prove invaluable
later in obtaining a full-time position in the field, since much
of their work in the beginning centers around these duties. Beginning
workers also may do considerable clerical work, such as copying
data, editing and coding questions, and tabulating survey results.
With further experience, economists eventually are assigned their
own research projects.
Graduate training increasingly is required for many economist
jobs, and for advancement to more responsible positions. Economics
includes many specialties at the graduate level, such as advanced
economic theory, mathematical economics, econometrics, history
of economic thought, international economics, and labor economics.
Students should select graduate schools strong in specialties
in which they are interested. Some schools help graduate students
find internships or part-time employment in government agencies,
economic consulting firms, financial institutions, or marketing
research firms. Like undergraduate students, work experience and
contacts can be useful in testing career preferences and learning
about the job market for economists.
In the Federal Government, candidates for beginning economist
positions generally need a college degree with a minimum of 21
semester hours of economics and 3 hours of statistics, accounting,
or calculus. Competition is keen, however, and additional education
or experience may be required for some jobs.
For a job as a college instructor in many junior colleges and
some 4-year schools, a master's degree is the minimum requirement.
In most colleges and universities, however, a Ph.D. is necessary
for appointment as an instructor. Similar to other disciplines,
a Ph.D. and extensive publication are required for a professorship
and for tenure.
In government, industry, research organizations, and consulting
firms, economists who have a graduate degree usually can qualify
for more responsible research and administrative positions. A
Ph.D. is necessary for top positions in many organizations. Many
corporation and government executives have a strong background
in economics or marketing.
Persons considering careers as economists should be able to work
accurately with detail since much time is spent on data analysis.
Patience and persistence are necessary qualities since economists
may spend long hours on independent study and problem solving.
At the same time, they must be able to work well with others.
Economists must be objective and systematic in their work and
be able to present their findings, both orally and in writing,
in a clear, meaningful way. Creativity and intellectual curiosity
are essential for success in these fields, just as they are in
other areas of scientific endeavor.
Job Outlook
Employment of economists is expected to grow about as fast as
the average for all occupations through the year 2005. Most job
openings, however, are likely to result from the need to replace
experienced workers who transfer to other occupations, or retire
or leave the labor force for other reasons.
Opportunities for economists should be best in private industry
and in research and consulting firms, as some companies contract
out for economic research services rather than support a staff
of full-time economists. The growing complexity of the global
economy and increased reliance on quantitative methods of analyzing
business trends, forecasting sales, and planning purchasing and
production should spur demand for economists. The continued need
for economic analyses by lawyers, accountants, engineers, health
services administrators, education administrators, urban and regional
planners, environmental scientists, and others also should result
in additional jobs for economists. Other organizations, including
trade associations, unions, and nonprofit organizations, may offer
job opportunities for economists. Employment of economists in
the Federal Government should decline in line with the rate of
growth projected for the Federal workforce as a whole. Slower
than average employment growth is expected among economists in
State and local government.
A strong background in economic theory, mathematics, statistics,
and econometrics provides the tools for acquiring any specialty
within the field. Those skilled in quantitative techniques and
their application to economic modeling and forecasting and marketing
research, including the use of computers, should have the best
job opportunities.
Persons who graduate with a bachelor's degree in economics through
the year 2005 should face keen competition for the limited number
of economist positions for which they qualify. Related work experience
conducting research, developing surveys, or analyzing data, for
example while in school is a major asset in this competitive job
market. Many graduates will find employment in government, industry,
and business as management or sales trainees, or as research or
administrative assistants. Economists with good quantitative skills
are qualified for research analyst positions in a broad range
of fields. Those with strong backgrounds in mathematics, statistics,
survey design, and computer science may be hired by private firms
for marketing research work. Those who meet State certification
requirements may become high school economics teachers. The demand
for secondary school economics teachers is expected to grow as
economics becomes an increasingly important and popular course.
Candidates who hold a master's degree in economics have better
employment prospects than bachelor's degree holders. Some businesses
and research and consulting firms seek master's degree holders
who have strong computer and quantitative skills and can perform
complex research, but do not command the high salary of a Ph.D.
Master's degree holders are likely to face competition for teaching
positions in colleges and universities; however, some may gain
positions in junior and community colleges.
Opportunities will be best for Ph.D.'s. Ph.D. graduates should
have opportunities to work as economists in private industry,
research and consulting firms, and government. In addition, employment
prospects for economists in colleges and universities should improve
due to an expected wave of retirements among college faculty.
Earnings
According to a 1993 salary survey by the College Placement Council,
persons with a bachelor's degree in economics received offers
averaging $25,200 a year.
The median base salary of business economists in 1992 was $65,000,
according to a survey by the National Association of Business
Economists. Ninety percent of the respondents held advanced degrees.
The highest salaries were reported by those who had a Ph.D., with
a median salary of $78,000. Master's degree holders earned a median
salary of $58,000, while bachelor's degree holders earned $51,000.
The highest paid business economists were in the nondurable manufacturing,
securities and investment, mining, banking, and real estate industries.
The lowest paid were in academia and government.
The Federal Government recognizes education and experience in
certifying applicants for entry level positions. In general, the
entrance salary for economists having a bachelor's degree averaged
about $18,300 a year in 1993; however, those with superior academic
records could begin at $22,700. Those having a master's degree
could qualify for positions at an annual salary of $27,800. Those
with a Ph.D. could begin at $33,600, while some individuals with
experience and an advanced degree could start at $40,300.
Economists in the Federal Government in nonsupervisory, supervisory,
and managerial positions averaged around $53,500 a year in 1993.
Like other college faculty, economists entering careers in higher
education may receive benefits such as summer research money,
computer access, money for student research assistants, and secretarial
support.
Related Occupations
Economists are concerned with understanding and interpreting financial
matters, among other subjects. Others with jobs in this area include
financial managers, financial analysts, accountants and auditors,
underwriters, actuaries, securities and financial services sales
workers, credit analysts, loan officers, and budget officers.
Sources of Additional Information
For information on careers in economics and business, contact:
National Association of Business Economists, 28790 Chagrin Blvd.,
Suite 300, Cleveland, OH 44122.
The Margin Magazine, University of Colorado, 1420 Austin Bluffs
Pkwy., Colorado Springs, CO 80918.