Employment Prospects of Economics Graduates

1. Employment Prospects of Economics Graduates John Sloman Director, Economics Network

2. Overview • Views of graduates • Some findings of the Economics Network Economics graduates survey • Your views • A workshop exercise • Views of employers • What employers feel about Economics graduates and what employers want from new employees

3. Views of Economics Graduates in Employment

4. Survey of Economics Graduates • Year of graduation • 1980s: 29%; 1990s: 30%; 2000–3: 41% • Employment • Full time: 72%; Part time: 15%; Education: 7% • Current salary • >£40K: 37%; £20K–£40K: 26%; <£20K: 26%;

5. How did the following influence your decision to take your current job? Source: Economics Alumni Survey, Economics Network, 2005

6. Skills highlighted byEconomics Benchmarking Statement • Abstraction • Ability to abstract the essential features of complex systems and provide a useable framework for evaluation and assessment of the effects of policy or other exogenous events. • Analysis, deduction and induction • Ability to use such analytical skills for problem solving and decision making. • Quantification and design • Ability to organise, present and analyse data. • Framing • Ability to decide what the important parameters are in constraining the solution to the problem. Understanding why these parameters might change according to the social and political context.

7. Specific concepts • Opportunity cost • Trade-offs and rational choices; efficiency v. equity • Relevance of marginal considerations • Equilibrium, disequilibrium, stability • Process of reaching equilibrium; Nash equilibrium • Incentives • Incentive mechanisms; targets and indicators • Strategic thinking • Understanding means to ends; trade-offs • Expectations and shocks • Understanding behaviour; also reactions to the unpredicted • Gains from voluntary interaction • Allocative efficiency; interaction as a positive sum game • Systems and dynamics • Long-term effects; how effects can accumulate or peter out

8. How do you rate your study of Economics in developing skills for your current job? Source: Economics Alumni Survey, Economics Network, 2005

9. How well did your degree course help you to develop generic skills suitable for your current job? Source: Economics Alumni Survey, Economics Network, 2005

10. How do you rate your own generic skills now? Source: Economics Alumni Survey, Economics Network, 2005

11. Looking back on your time as a student and knowing what you do now about careers and the workplace, would you still choose to study Economics at degree level? Source: Economics Alumni Survey, Economics Network, 2005

12. Tip for getting a job with the GES A keen interest in economics, current affairs and politics is vital. To get into the GES it is important to demonstrate personal skills, which indicate your ability to deal with problems quickly and imaginatively while providing high-quality solutions. In addition, you must be able to think in terms of economic processes – emphasising not so much specific knowledge of models and literature, but the capacity to apply the analytical basics of economics to problems encountered on the policy front. It helps to practise mental application of economics to everyday problems, such as ‘how could the government provide incentives to increase the supply of housing in the UK?’, etc. Mario an Assistant Economist with the GES (quote from Prospects)

13. Your Views: a ‘speed dating’ exercise • Round 1: in pairs • The person on the right as you face the front should play the role of an employer at interview. The person on their left should play the applicant for a job as an economist. • The task: conduct a 5 minute interview where the applicant has to describe the various skills they have developed during their degree that would make them a particularly suitable employee. • Round 2: in different pairs • Turn to the person on the other side of you. Repeat the first exercise, but this time the roles are reversed.

14. Views of Employers

15. Quote from Prospects • Employers value: • economics graduates' understanding of decision-making • their research and analytical skills • their experience of viewing problems in their national and international context. • These skills will be tested through any graduate job selection process.

16. Australian employers of Economics Graduates Looking for skills that can be transferred to various applications Public-sector organisation Many applicants and recruits appear to have less exposure to the application of economic theory to policy issues within their degrees Private-sector organisation Economic theory must be balanced: i.e. business reality Private-sector organisation Practical work experience is very important: e.g. vacation periods or placements Private-sector organisation Cannot emphasise too highly the value placed on (1) the capacity to write succinctly for an audience without formal economics training; (2) to speak clearly logically and articulately in conveying assertions, analysis and conclusions; (3) knowledge of data sources and the weaknesses of and limits to uses of different types of data Private-sector organisation

17. Strengths of Economics Graduates • Analytical way of thinking • Problem-solving • Recognition and clarifying • Problem analysis • Identifying and comparing alternative solutions to problems • Scepticism over possible misuse of data

18. UK employers of Economics Graduates What we are looking for in Economics graduates is how they apply economic theory to real-world problems, find the theory and the evidence to support it and dissect the problem before looking for its solution. HM Revenue and Customs Economics graduates have an advantage in content knowledge, but they need to be careful not to concentrate too much on the theory, when applying for jobs. We would accept someone if they didn’t have economics. Private-sector consultancy firm We are looking for Economics graduates’ ability to apply economic theory to policy in practical situations. They have to know enough of the theory to be able to extract it. That’s what we are looking for in selection, people who are able to apply economics to real-life issues. GES Economist Group Management Unit In problem-solving we are looking to see if applicants are able to quickly recognise problems, clarify the problem, analyse the problem, come up with different options and solve the problem effectively. Private-sector consultancy firm

19. UK Employers’ Views on Graduate Skills (all graduates) problem-solving to be a very important attribute but one with which they are only moderately satisfied because of graduates' lack of real-world application. Most employers consider: that understanding of core principles, technical ability, potential and willingness to learn and continually updating knowledge are more important than a stock of knowledge. that graduates are not particularly good at applyingknowledge or understanding to practical work situations because of (i) inability to improvise, (ii) lack of commercial awareness and (iii) lack of appreciation of the human or cultural context within which they are working. Employability Backpack (U of Central Lancashire)

20. Weaknesses of Economics Graduates • Communication skills • written; oral; empathising • Ability to work effectively in teams / groups • lack of group work in many ‘traditional’ degrees • Applying theory to real-world situations • prior experience has been too abstract or stylised • Understanding the requirements of employers

21. You can find this presentation on www.economicsnetwork.ac.uk/archive/employability.ppt