The econ “Job Market”

Economics blogger Noah Smith has an interesting post on how graduating economics PhDs find jobs in what is known as the “Job Market”.  It’s a very centralized and organized process, much like how medical students match into residency programs.   All the available jobs are posted in one place and the candidates get interviewed at the American Economics Association annual meeting each January.  The academic departments are directly involved in helping students send out applications and obtain recommendation letters.  The only requirement to go on the job market was to have a single paper that he calls the “Job Market Paper”, which doesn’t even have to be published.  What struck me most was Smith’s claim that almost everyone in the top 50 economics departments get decent jobs.  He implies that  many get jobs in universities and government like the Federal Reserve and the rest in the private sector.

This is in complete contrast to how students in science and mathematics find jobs upon graduation.  In the first case, almost all science PhDs now must do one and usually more post doctoral fellowships before finding a tenure track faculty position.  It is quite common to spend six or more years in these temporary positions before securing a permanent job.  During this time, the ones that do find jobs will have had to publish many papers in prestigious journals. As opposed to economics, where assistant professors can be hired on promise of future potential, the science job market is so competitive that a young person must first prove that they are a completely independent researcher that can secure funding.  Additionally, many if not most of the PhDs will not be able to find tenure track faculty positions.  There is then no systematic way for them to find alternative career paths if academia doesn’t work out for them.  They’re on their own tracking down leads in the private sector and some like Douglas Prasher, who was important in the discovery of GFP, may end up driving a bus.  Math is slightly different in that most PhDs take  non-tenure track faculty positions that are time limited.  The super stars can get tenure track jobs directly out of graduate school. It is extremely difficult to find a tenure track job at a research university in math.

I think the main reason that a centralized “Job Market” exists for economics but not for say biology is that the filter for entry into the field is set at the graduate school level.  Because funding for economics is very low, academic departments admit relatively few students each year.  Hence, economics is at a steady state, where the number of available jobs each year  approximately matches the number of graduates.  This is completely different for science, and in particular biology, where many more graduate students are admitted then there are jobs.  Additionally, the number of graduate students admitted is mostly set by how much research funding is available and not how many permanent good jobs will be available when they graduate.  Also, biology is a labour intensive field where it is not uncommon for a single principal investigator to manage a group of twenty or more students and post docs..  As long as federal research funding remains where it is, there will always be a mismatch between the number admitted to graduate school and the number of available faculty jobs.  However, that is not to say that departments couldn’t do more to help students and in particular post docs find jobs when they graduate.  Post docs are generally forgotten entities in academic departments.  They are usually hired directly by a faculty member and there are not a lot of university or department services devoted to them.  I think that departments that take federal funding to hire post docs should have some sort of “post doctoral advisor” that helps post docs find jobs.  In particular, departments should make clear from the outset that the prospect of obtaining an academic position is low and find smoother paths for people to find jobs in the private sector.




12 thoughts on “The econ “Job Market”

  1. Seems reasonable that economists understand supply and demand while other disciplines conveniently forget the demand part.


  2. There is strong demand for extra hands at the graduate and post doctoral level but weak demand at the faculty level. So, it’s more of a market failure then ignoring market pressures.


  3. Seems like the postdoc market may be driven by the lack of a competing industrial job market. Here’s my perspective from another field: engineering. In engineering, there is little interest for PhDs to pursue a postdoc because industrial experience can be almost as valuable as publications for prospective faculty positions. Coupled with that is the much larger industrial job market in engineering as compared to science. However I don’t know if the same is true in economics and finance. I would think an economics PhD would have significantly better prospects in industry than a science PhD, and that would likely limit the postdoc market for economics. Engineering is quite different from economics, however, in that there is NOT the same filtering at the graduate school level.


  4. My sense of the culture of Mathematics Depts is that they are not keen on hiring PhD who have industry experience (excluding NIH, national labs, etc. that are more academic in nature). In fact, there are several ‘prestigious’ academic postdoc fellowships/awards that are supposed to beef up young mathematicians’ CV, among other forces (advisor influence, lack of services for industry as you pointed out) that keep math Ph.D.’s from going to industry.


  5. 1) There is an easy fix. Government dollars should be used to fund permanent research jobs in laboratories. There is ample evidence that stability improves productivity in science.

    (Sometimes people assume that leaving post-docs struggling will force them to work harder on their research. Statistically, this does not work. I believe that they are distracted by career issues and cannot focus as much as they should on research.)

    So, very simply, we should fund professors *less* and government laboratories *more*.

    2) The story of Douglas Prasher is amazing. Thank you for sharing. I’ve known a brilliant mathematician, and I mean *brilliant*, who wrote multiple exciting papers (I thought they were) only to end up working as a web designer (and not a very good one). Last time I saw him, he was giving classes on web design. What amazed me is how people from academia reacted: “well, he was always a weird one”, “he had personal problems”. Sure, he had personal problems: he had 3 kids to feed and could not find a job despite having an incredible talent. And yes, I guess he was original, going from math. to web design, but one has to eat…


  6. Chris: I agree that the weak competition from industry is a problem for science. Many of these people eventually find jobs in the private sector so it’s mostly a communication problem I think.

    Cheng: I’m not sure if there is a bias against industry in math departments per se but more that there are so few examples of this happening. Also, in math, once you get out of the academic track, I think it is hard to come back. It takes a lot of focus to do high level research in math.

    Daniel: I think there are lots of people that have great talent that fall through the cracks somehow. The Jeremy Lin story in some sense is a reminder that we’re probably wasting a lot of talent right now. In order to succeed at the faculty level, one must almost be as good a manager as a researcher, especially in biology. There are many examples of brilliant people who cannot handle the management aspect.

    I like your government lab idea. This is kind of the way it is run in France, where it seems like anyone coming out of a Grandes Ecoles gets a guaranteed job. It won’t happen in the US any time soon though.


  7. There are probably many factors that make going to industry an irreversible move for aspiring math academics, not the least of which is how hard one has to work at math and how unworthy their application would look (even at a lower tier math dept).

    Shame because there are a lot of interesting industrial jobs for mathematicians.


  8. Hey guys,

    Speaking from the other side of the industry/academia fence, I’d add a bit to what Carson and Cheng noted, particularly for math grads:

    1) Agreed, it’s very hard for math folks to switch back to academia from industry. As Chris notes, it’s much easier for engineers. And for many computer science departments in particular, industry experience is quite highly valued for job applicants.

    2) In many (though certainly not all) academic math circles, there’s still a perceptible disdain for application as opposed to theory (for a very loose definition of “application”, too). Hardy’s “Apology” staked that position out pretty explicitly, though I’m sure the cultural issues are much older than that. I’ve seen this view color students’ perceptions, making them pretty resistant to the industrial move even when it’s clear their academic options are running low.

    3) Many students come from grad school / post-doc quite ill-prepared for work in industry. The traits needed for success in the two domains differ in some important ways. Breadth of knowledge and utility are generally much more valued than specialization. Rigor is still important, but to a lesser degree (there are hard deadlines, and real-world problems can only be idealized so far and still be relevant). There are numerous other cultural differences which sound trivial – but turn out to be quite difficult for some people to navigate. I’ve worked with and hired a good number of people with decent research records who have struggled considerably to make this adjustment; sadly, some of them never made it. Such people are then in a very tough position where it’s hard for them to stay employed in their field at a satisfying level in either academia or industry.

    I think it’s often assumed somebody with sufficient research chops can always just jump to industry, but students often don’t realize that (like universities), many companies aren’t hiring for raw talent – they need hires who can be productive without a long/expensive ramp-up period. It’s not the job of the advisor or department to get such preparation for students, so the onus is on the students to make themselves relevant to potential employers well before they start their search. Of course, this does ask a lot of students, who are already buried deep in their academic obligations.


  9. The dismal science has people convinced that they have something important to say, and even though they can say nothing predictive or explanatory other than post-facto, this myth persists. Do you really think we would miss much if all economists were asked to be janitors? Other than clean bathrooms, I mean? Basically, it’s a mafia that monitors who gets in and then they take care of their own – you don’t see economists running around saying that economics has no clothes (well, you do but very rarely and never academics). What economists should be forced to do is to make predictions and have their salaries actually depend on the quality of their predictions.


  10. Well, the blog Calculated Risk and economists like Robert Shiller and Nouriel Roubini were warning of the real estate bubble in 2004. They were one of the reasons I held off buying. Roubini also predicted the financial crisis as early as 2006-2007 on which I made some, although not enough, financial decisions.


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