Where do I go with economic$?

Career World, Feb-March, 2005 by Marie Hodge

Do you have the ability to make well-considered choices about whether to spend your allowance on a movie today or to save it to buy that X-Box you really want? In the field of economics, you can have a career making similar choices, but on a larger scale.

Bruce Johnson, a professor of economics at Centre College in Danville, Ky., describes the field of economics as "thinking about how people make choices because we have limited resources. What are we going to buy and do with those resources?"

Should a family spend money on a new car or on college tuition? Should the government use tax money to build more hospitals or to lay down more highways? Everyone, from the average person at home to nations engaging in international trade, must make economic decisions. As an economist, you would help in the process.

Because economics has applications in so many areas of life, it can lead to a wide variety of careers. The area you would specialize in depends on your interests.

People with backgrounds in economics can use their degrees to become accountants, stockbrokers, entrepreneurs, investment bankers, lawyers, teachers, loan officers, financial advisers, and more. In business and government, they can do everything from keeping the books to setting a course for a company's future.

The outlook for jobs is excellent; a bachelor's degree in economics or finance is one of the five degrees most in demand by employers. Depending on the kind of job you want, you may need an associate's degree, a bachelor's, a master's, or a doctorate.

The median entry-level salary of economics majors with bachelor's degrees was $38,000 in 2002, according to the National Association of Business Economists. For economists of all levels of experience and education, the median annual salary was $94,000.

ADVISING BUSINESSES

"When I was a kid, all I wanted to do was play basketball," says Ben Russell. "But when I got to college, my professors inspired me with their knowledge and insight into different careers." Russell took the ball and ran with it.

He earned a B.A. in economics, with highest honors, from Hobart College in Geneva, N.Y., in 1999. His resume included an internship as a stockbroker's assistant. Russell accepted a job in an area called transfer pricing at Ernst & Young, a large accounting and tax firm. He is now a manager in its Kansas City, Mo., office.

When U.S. companies sell goods and services to a company in another country, they need to pay taxes to that country. Transfer pricing ensures that each country receives the correct amount of tax while putting a fair price on the products. It's a complicated field that requires a lot of research about such things as the prices competing companies charge for similar products.

Russell's first job was to do that research. As he was promoted to higher levels, he prepared written advice based on the research. Now he sells his company's services directly to clients. In the course of a few years, he's developed top-notch skills in data analysis, clear and persuasive writing, sales, and customer service.

ANALYZING BASEBALL PLAYERS' SALARIES

Bruce Johnson, the Centre College economics professor, had planned to be a lawyer. However, an introductory course in economics and an internship at the Congressional Budget Office in Washington, which examines many of the nation's financial issues, changed his mind. "Most of the people working there were economists," he says. "I would go to lunch with them, and the conversations were a lot more interesting than reading the fine print in some contract or putting some murderer away."

Johnson, who has a Ph.D. in economics from the University of Virginia, first began to research economic issues in the sports world to engage his students' interest. Today, in addition to teaching at Centre College, he is also a prominent and sought-after expert on sports-related economics issues, such as whether new baseball stadiums are a good investment for cities.

In the 1980s, Johnson analyzed data to prove that the number of black players and white players on a baseball team affected players' salaries. "A black ballplayer with three other blacks on the roster is paid more than a black player with 10 other black players on the team," he says. He's also done extensive studies of stadiums built in different cities. His surprising conclusion was that "stadiums are a terrible investment for taxpayers" and don't help local economies at all.

Johnson counts himself lucky. "I'm paid to think about things [that] I think are very interesting," he says.

OVERSEEING A RESTAURANT CHAIN

Jill Skogheim first felt the lure of economics as a student at DePauw University, in Greencastle, Ind. Her experience was similar to Johnson's: An introductory course hooked her. "It was really interesting the way they applied economics to life, from health care to environmental solutions," she says.

Today, Skogheim is the director of operations and marketing for the 5-8 Neighborhood Grill and Bar, a restaurant chain in Minneapolis and St. Paul, Minn. She makes economic decisions about her restaurants every day, such as how to get consumers to choose her restaurant over a competitor's or where to build new restaurants. To do that, Skogheim has to look at factors such as whether there's a big shopping draw--such as a mall or a department store--near the site, so shoppers would see the new restaurant and stop to eat.