Any Advice for an Aspiring PhD Economist Who's NOT Interested in Academia

[YoungEconomist]

First, I want a PhD in Economics because I love the field. It's interesting, useful, etc... I know there are fields/degrees out there which earn more money, but the added benefit of Economic knowledge is worth the likely salary hit.

 

Second, I have not made up my mind as to what I want to do (career wise) with a PhD in Economics. I figure if I go into the field I love, I will be able to find a job that I enjoy. I may want to be a professor, but currently the idea of the private sector is more appealing and more realistic (since careers in academia are super competitive).

 

With that said, I am looking for any information/advice about job opportunities in the private sector for PhD Economists.

• Is it easy for PhD Economists to find careers in the private sector?
  
• Where do they work?
  
• What kind of jobs do they do?
  
• Does it matter where you get your PhD?

These are just a few of the questions on my mind. Feel free to offer up anything related to the general post, even if it's not directly related to the questions above.

[jahizbarlas]

ive heard its pretty easy for econ phds to find work other than academia. the thing is most phds dont want to work in the pvt sector as people who are likely to do phd are also likely to hate 8-5 office jobs where they work under someone else and do their bidding. with academics, the freedom is awesome.

the lower ranked graduating students are usually the ones who end up in pvt sector. obviously they get paid more than their peers who choose academics or the like.

the work can range from anything like wallstreet to consulting (probably the most popular choice). bain, jpmorgan, boston consulting, etc are firms that hire econ phds a lot.

because youre going into pvt sector, the name of the university matters much more than it would in academia. e.g academics might know that a famous university is bad in a specific field and might not want to hire the phds of that school of that field, but im guessing, the pvt sector prob doesnt keep in touch with all this and are only looking for people who are well tooled with math skills and logical analysis and might want to hire people from famous universities over others because of the name of the university.

if you want to do economics because you love it, by all means go ahead. but if you want to do it to get a nice pvt sector job, youd be much better off doing something like an mba. some soul searching should help you decide this....

[delta_method]

A PhD in economics can be pretty useful for a job in economic litigation consulting - firms like NERA, CRA, Analysis Group, Cornerstone, LECG, etc. There are even opportunities to publish as part of your work at these places, though its not really up to you what you write about.

 

Also, entering Phd's at economic litigation consulting firms make the same amount as entering MBA's.

[SunnyDutt]

If your like me, you might want to work as an economist at a central bank or government ministry of finance or treasury. I want to work as an economist at the Deutsche Bundesbank in Germany because my heart is set on Germany for my living career.

[werther]

I want to work as an economist at the Deutsche Bundesbank in Germany because my heart is set on Germany for my living career.

 

me too. i hope to do my master's at queen's so i get to go to mannheim for one semester.

[Cassin]

because youre going into pvt sector, the name of the university matters much more than it would in academia. e.g academics might know that a famous university is bad in a specific field and might not want to hire the phds of that school of that field, but im guessing, the pvt sector prob doesnt keep in touch with all this and are only looking for people who are well tooled with math skills and logical analysis and might want to hire people from famous universities

 

I believe, this is incorrect. Academia is very name-snobby, so someone from Top 125 university has virtually no chance at a research-university job but can get a very good private sector job, especially if they have relevant experience and good interviewing skills. I have observed that "big brand name" only helps for the first interview in private sector and then it's up to the individual. So Harvard is only weakly preferred to Cornell or Brown as far as consulting goes (if at all!) but strongly as far as placement for tenure-track. Oxbridge might be the exception as they are very well known internationally but are not top 10 economics schools. On the other hand, academic researchers are sometimes judged [besides publications, which private sector discounts] by their school of PhD as in listing Researcher_name (School_name, Year) many years after graduation. In private sector, recent experiences are much-much-much more important than distant brand-name reputation, except for alumni-connections.

 

Also, private sector cares more about job-applicable skills rather than being on the edge of, say, the econometric theory field. Hence, prestige of supervisors and school's name is less important, assuming a diligent student learned how to run regressions and make charts.

[CreativeDestruction]

There's an opportunity cost in taking a PhD rather than an MBA. Sometimes people really just want to work in business and think that getting a PhD will get them a better business job. It's not necessary to get a PhD to get a job at an investment bank, and it costs a lot more in tuition and time. Investment firms value experience as much and more than formal degrees. In other words, if you want to work at an investment bank, don't get a PhD.

[EconMist]

If you are so interested in economics, I don't the cost of a ph.d. is too high. Once you get your Ph.D., I am not sure how comparable the opportunities available to you in the private sector will be to that of a recent MBA graduate. In addition, as long as your subfield of specialization is relevant in the private sector, I don't think getting a Ph.D. is a waste even if you don't teach or do research in an academic setting (so long as you're really interested in economics and you derive utility from the act of pursuing a ph.d. in economics).

 

~EconMist

[CreativeDestruction]

Econmist is speaking from his point of view, but he's not hiring for investment banking jobs. If you had the choice between two candidates for a finance job--one who is 30 years old and $100,000 in debt with no practical experience in finance and another who is 25 years old with no debt and 2 years of practical experience in finance, I'm pretty sure you'd go for the latter. I've met people in finance and some think that academics are eggheads, who value ideas more than making money. If you in it for the ideas, you should bite the bullet and go into academics. If you're in it for the money, you should bite the bullet and get an MBA. It's impossible to be everything to everyone. Don't be a Willy Loman.

[EconMist]

Yes, I am speaking from my point of view....but then again, so is CreativeDestruction....and so is everyone else in this forum. I know that CreativeDestruction is just expressing his/her views, but his advice is a little misleading. First of all, why are we limiting our discussion just to investment banking? YoungEconomist did not specify a specific area in the private sector. Second, a Ph.D. has opportunity costs, but not a lot of explicit costs for many. Most, if not all, get paid to study, which is not the case for MBA students. So your saving might be zero (or even slightly negative) immediately after you get Ph.D. graduation, but you will not end up with a $100k debt. To sum up, Ph.D. is not a bad idea at all when compared to MBA even if you want to work in the private sector.

[jahizbarlas]

i strongly believe that if you want to do a phd, do it because you love it and dont care about money. the reason is that a phd is too much of a time commitment and the rewards arent proportional to the work you put in it, sometimes.

getting an MBA would be a much better option if you are looking to be in the money cuz youll spend much less time in school and your rewards will be pretty handsome.

ask yourself if youll be willing to live like a poor grad student for 5 more yrs because you love economics and dont care about money, and if your answer is a resounding yes, then go for a phd. if not, get a MBA.

[lirac]

Yes, I am speaking from my point of view....but then again, so is CreativeDestruction....and so is everyone else in this forum. I know that CreativeDestruction is just expressing his/her views, but his advice is a little misleading. First of all, why are we limiting our discussion just to investment banking? YoungEconomist did not specify a specific area in the private sector. Second, a Ph.D. has opportunity costs, but not a lot of explicit costs for many. Most, if not all, get paid to study, which is not the case for MBA students. So your saving might be zero (or even slightly negative) immediately after you get Ph.D. graduation, but you will not end up with a $100k debt. To sum up, Ph.D. is not a bad idea at all when compared to MBA even if you want to work in the private sector.

 

I've worked for over 2 years in consulting and have considered the MBA vs PhD option a lot.

 

MBA (at a top school):

- Lose $60K/yr for two years (note: this is not trivial)

- Starting salary of about $140K (not trivial either...)

- Job in the private sector; work will definitely not be academic and also will probably not be very analytical (relatively speaking)

 

PhD (at a top school):

- 5 years, but probably at no (direct) cost

- Assistant professorship at good econ/business school option has a salary of about $60-100K (I haven't done much research here on this amount)

- Opportunities in the private sector range from $80-150K/yr. Work will be more analytical than an MBA and can often be a bit academic as well.

 

So if money is all you care about, MBA is the route for you. If research, lifestyle and intellectual work is all you care about, PhD is for you. I'm somewhere in-between, and after having worked for a few years decided PhD is the route to follow because I don't think an MBA route will end up challenging me enough intellectually. Downside is that, 5 years from now when I graduate with a PhD, I will probably make less money than I do now :(

 

If you are a senior in college and (like me when I was senior) have no *#$ing idea what the real world is like, what working 40 hours a week vs. 60 hours a week is like, what having a social life outside of college is like, whether or not devoting your life to research is worth it, etc., I recommend working first for a couple years. I'm glad I did -- it's the only way I was able to make an informed decision.

[EconMist]

One thing people should think about is that an MBA and a Ph.D. are not really comparable (except in terms of their financial return). The MBA is a degree for the practicioner whereas the Ph.D. is for the more of a research degree. An MBA and a Ph.D. would be doing totally different things even if they both end up in the private sector. True, if money is all you care about, MBA is the way to go. Yet, you will likely end up working your butt of in a 9-5 prison. If you want to do research in the private sector, an MBA is a waste of time, go for a more technical field (like econ or finance).

 

~EconMist

[YoungEconomist]

i strongly believe that if you want to do a phd, do it because you love it and dont care about money. the reason is that a phd is too much of a time commitment and the rewards arent proportional to the work you put in it, sometimes.

 

I agree. And this is the reason I have decided that I want to pursue a PhD in Economics, because I love it. The only thing that scares me a little bit, is that I don't know what I want to do with a PhD in Economics. What if I don't like the careers that result from a PhD in Economics? Also, even if I find a career that I do like (such as working in academia), there is far from a gaurantee that I will wind up there, because of the competitiveness of PhD Economists in academia.

 

Usually I come to the same conclusion though, I love Economics so I should go for it and I am pretty sure that I can get a career that I enjoy.

[EconMist]

YoungEconomist, yes....pursue a PhD in econ if and only if you love economics extremely. Having said that, don't worry about placement. If you love economics so much, just Get the Ph.D. and you will find something you will like. Let me remind you that Professors rank # 1 in job satisfaction (i.e. who answered yes to the question "would you have pursued the same career had you known what you know now?")

[econosaur]

"Loving economics" is not nearly enough. You must love economic theory. And, from my experience, those who truly love economic theory would never dream of pursuing a career outside academia. Those that end up in the private sector are not usually there by choice; they simply could not hack it in the competitive world of academics. So, what I'm really trying to say is, if you go into graduate school with the ultimate aim of a private sector job, you won't have the passion and desire to compete with the theory guys who study for the prelims as if their entire lives depend upon the results. Because they do for them, and you will soon see why Ph.D. programs train researchers and not practitioners. May I suggest you save yourself the heartache and go the masters route?

[gameguy56]

what about careers in the US Gov't that require PhD in economics. I think that'd be an interesting career choice that has some similar aspects to academia, without the nightmarish competition.

[mosfro]

if money is all you care about, MBA is the way to go. Yet, you will likely end up working your butt of in a 9-5 prison.

 

~EconMist

 

 

I think its more like a 8-7 prison, ask around.

Anywho, I too contemplate career opportunities in the private sector, and I have seen that some companies who only have 1-2 phd economist on the payroll, see the phds as Uber-eggheads, so if that helps your ego at all...

Also, its mainly data analysis work, major data programming, regressions, all the crap you probably will do as an RA anyways, so nothing new and exciting...Often time the pay is good, and usually in a desireable area, because thats where many corporate offices are located, like say Irvine, CA (yah im from the OC)....my main reason for gettin the phd is to keep options open, and maybe go the academia route, but if i dont, then i still have the option to be a part-time lecturer later in life, as i truly enjoy teaching

[gameguy56]

Also, I think working for the IMF or World Bank could be a very interesting opportunity for a PhD economist

[ephyou]

i personally don't see why you would want a PhD at all if you arent somewhat interested in academia. The top students become professors/researchers

[Zoethor2]

I'd like to get my PhD, but my immediate career goal is not academia. I would love to work in a think tank or a consulting firm, something along those lines. I still feel like a PhD is the best way to assure that I'm able to do that effectively. Academia is a long term goal, but definitely not something I want to pursue until I've done some "real world" activity... so I don't think it's totally crazy to think that the skills you learn while getting a PhD could be applied somewhere other than academics.

[Econ2006]

However, the more "real world" activity you do the lower are your chances of ever finding a decent job in academia, unless that activity takes place at, say, the Fed or the CEA.

[YoungEconomist]

i personally don't see why you would want a PhD at all if you arent somewhat interested in academia. The top students become professors/researchers

 

In all honesty, I do not know what I want to do. What I do know is that I love economics. Being a professor actually sounds pretty interesting. I also know that a career in academia can be extremely competitive. I just want to know what my options are before I decide to get a PhD, I will figure out all the career details along the way. Currently, I like the idea of working in academia, a think tank, or an economic consulting firm.

[Zoethor2]

However, the more "real world" activity you do the lower are your chances of ever finding a decent job in academia, unless that activity takes place at, say, the Fed or the CEA.

 

Yeah, I've heard this enough that I do believe it, even though it irks me. I don't understand how going out and doing research with policy implications should make me a less desirable professor. (And I'm sure someone will explain it to me now.)

 

But either way, I've never been huge into needing to work at a top ten school. That would be cool and everything, but by the time I figure I'll be settling into academia, I don't think I'll care as much about the brand recognition aspect.

 

Like YoungEconomist, though, I'm really pretty unsure what I want to do with my post-PhD life. All the things I'd like to do, a PhD in economics will definitely at least help a lot, and I love studying economics (theory included), so it seems like the best next step.