Econ Job Market Rumours and the lack of Econ PhDs who can and will teach in the US

[tm_member]

Hi all,

I don't go onto the econ job market forum as I've heard that it is basically full of nonsense. But I do have a related question for advanced students...

I was reading Stock and Siegfried's paper about US Econ PhD's (WP here) and see some pretty interesting long term trends that the authors were concerned about.

Basically in the 70's there were about 1150 PhD Econ graduates per year of which 800 were American... Now (well, as of 2003) the numbers were 950 of which only 400 were American. Now I know the impact is not as strong as the numbers would suggest, but surely this decreases the supply of potential newly minted US faculty members?

My question is, is there going to be a shortage of US Econ PhD's in the future? I am guessing that most of the graduates from the 70's are still actively teaching even if not researching, so I guess there's no immediate problem, but surely retirement of senior faculty will eventually lead to a shortage of PhD's?

If not, where are the faculty coming from? Is it easy for non-US citizens/residents to stay after they finish?

It's been bugging me since I read the Siegfried and Stock paper, and I'm hoping it will lead to more options for me in 5-6 years when I go on the job market...

Thoughts?

[untitled]

Based on the census report on education, from 1970 to 1999, the number of institutions (2, 4, and both), instructional staff, and the total enrollment have doubled or nearly so (number 257), as have school expenditures (number 199). Over the 1990s there was an approximate 3% annual increase (population grows at a bit less than 1% annually) in the instructional staff. That said, the number of graduates was quite high in many fields in 1971 (number 279) - quite the baby boom - and since then the social sciences (and humanities, but not splitting out economics, which others may suggest has grown since 1971) have not fared so well, seeing a decline in the number of and graduates (with business, communications, biology, health, and even parks and recreation seeing sharp increases).

My feeling is that starting your training to become a professor in economics in four-six years is a good, not great idea. It is even better if you choose a field closely related to economics such as business (or even finance for you EJMR junkies) or do economics of education, urban economics, health economics, etc and be open to hires from hybrid departments.

As for the particular question about the national make-up of professors, From the professors in the US that I've known, I do get the impression that American born professors are more likely to be older, and younger, even under 50, professors are more likely to be US born, which reflects a trend that seems to stretch back around 25 years. That is, I would guess that the shift to fewer US-born graduate students started around 1985, and has accelerated since then. Even Clark medalists are now regularly foreign born (3 of last 4, Acemoglu, Saez, and Dufflo with Chetty waiting in the wings). That is, I don't think the growth of international institutions - particularly in East Asia, has greatly reduced the allure of academic positions in the US - the changing nationality of PhD's in economics is directly reflected in the changing nationality of your professors (a welcome trend, I think).

[tm_member]

Let me rephrase, does anyone have any evidence of a shortage in Econ PhD's who are eligible to work long-term in the US? I am really aiming for a good liberal arts college placement after graduation, and then to move up if possible.

While I thought that good placemnt into a US position was getting harder, the paper I referenced suggests that my ability to work and live in the US long-term may be a help as there are less US eligible graduates...? Or can all graduates work in the US after their PhD?

[asquare]

Let me rephrase, does anyone have any evidence of a shortage in Econ PhD's who are eligible to work long-term in the US? I am really aiming for a good liberal arts college placement after graduation, and then to move up if possible.

While I thought that good placemnt into a US position was getting harder, the paper I referenced suggests that my ability to work and live in the US long-term may be a help as there are less US eligible graduates...? Or can all graduates work in the US after their PhD?

PhD-holders usually qualify for H1-B visas, which allow them to work in the US for up to 6 years. More senior faculty may be able to receive O-1 visas, which can be extended indefinitely. U-Mich has very clear information on both types of visas as they pertain to faculty. Non-Americans and non-Europeans certainly can and do obtain tenure-track employment in US colleges and universities.

For more information about labor market conditions and supply and demand for PhD economists, I suggest you look at the Labor Market Surveys for New PhDs in Economics. The information isn't broken out by citizenship, but I don't think it supports the hypothesis that there is a brewing shortage of economists.

[tm_member]

Thanks asquare... :-)

[AppliedEcon]

From the US Occupational Outlook Handbook:

"Job Outlook About this section

Employment of economists is expected to grow more slowly than the average for all occupations. The demand for workers who have knowledge of economics is projected to grow faster, but these workers will commonly find employment in fields outside of economics, such as business, finance, or insurance. Job prospects for economists will be best for those with graduate degrees in economics.
Employment change. Employment of economists is expected to grow 6 percent from 2008 to 2018, which is slower than the average for all occupations. Demand for economic analysis should grow, but the increase in the number of economist jobs will be tempered as firms hire workers for niche areas with specialized titles. Many workers with economic backgrounds will work in related fields with more specific job titles, such as financial analyst, market analyst, public policy consultant, researcher or research assistant, purchasing manager, or a variety of positions in business and the insurance industry. Overall employment growth also will be slowed because of the relatively high number of economists—about 53 percent—employed in declining government sectors.
Employment growth should be fastest in private industry, especially in management, scientific, and technical consulting services. Rising demand for economic analysis in virtually every industry should stem from the growing complexity of the global economy, the effects of competition on businesses, and increased reliance on quantitative methods for analyzing and forecasting business, sales, and other economic trends. Some corporations choose to hire economic consultants to fill these needs, rather than keeping an economist on staff. This practice should result in more economists being employed in consulting services.
Job prospects. In addition to job openings from growth, the need to replace experienced workers who retire or leave the labor force for other reasons will create openings for economists.
Individuals with a background in economics should have opportunities in various occupations. Some examples of job titles often held by those with an economics background are financial analyst, market analyst, public policy consultant, researcher or research assistant, and purchasing manager.
People who have a master's or Ph.D. degree in economics, who are skilled in quantitative techniques and their application to economic modeling and forecasting, and who also have good communications skills, should have the best job opportunities. Like those in many other disciplines, some economists leave the occupation to become professors, but competition for tenured teaching positions will remain keen."

[Kaysa]

To my knowledge, the demand for jobs exceeds the supply for jobs. But this has more to do with funding issues than an actual need for faculty. I am not sure what is going on, but it appears that higher education is entering some sort of crisis. At least that is what all my profs keep saying

From what I hear, it is relatively harder for foreign graduate students to get academic positions in the U.S., especially liberal arts college positions.

[blockRed]

Overall employment growth also will be slowed because of the relatively high number of economists—about 53 percent—employed in declining government sectors.

Interesting...though i doubt the government sector at the moment could be classified as "declining."

[eigenman]

Interesting...though i doubt the government sector at the moment could be classified as "declining."

Maybe not at the national level, but iirc from today's numbers public employment at the state and local levels is declining precipitously.

[_nanashi]

Your making an assumption that most foreign students go back to their own countries. A few of the do, but the majority of them don't. The current reality of the economics job market is this. Most graduates apply to 50 or more schools to hope to get one job. Some of the people at my lower ranked University are applying to 200 or more places. Most of the Interviewing is done in large batch at conferences such as the annual AEA meet.

In general almost everyone in Econ gets a job. However, the jobs that are called academic placement are extremely competitive. Unless your at a top 10 your not guaranteed a good placement. Even at the top 5 some people don't manage to secure academic palcement. Academic placement according to what professors thing of Academic placement is A large research University, usually with an Economics PhD program. Some people may consider a flagship university with out a PhD program to be academic placement, or a prestigious liberal arts college as well. However, your talking about at most 200 schools of this nature in the U.S. (counting prestigious LACs, and Flagship research Universities without PhD programss.). Assuming these schools employ on average a faculty size of 25. Your talking about at most 5000 total spaces, when there are roughly 1000 Economists produced each year. Assuming an economist researche for 35 years. Thats about 7 economists to one job. Most economists at lower ranked schools and roughly a third of the people outside of the top 10 but above the top 50 end up at smaller universities that are usually satellite campuses to a bigger university system, or a subservient system. (Its like ending up at Cal state instead of University of California). There predominant job is to teach the average undergraduate sudent.


However, the one thing that Americans do benefit from is there is a home bias. Foreigners do not have the level of negotiating power that citizens of the U.S. do. They have to deal with the hassle of picking an employer that will help them secure a visa, and have less negotiating power the moment they enter the job market. This is true of nearly all fields. There is also a bias against people with poor English . Of course I'm sure its not as big a issue for top universities, who are more likely to put the quality of someones work above anything else.