Why does economists make more money than engineers?

[mlxer]

Engineering I would say is a lot harder. Tougher to study, hardeer jobs. But economists seem to be paid better. Why is this? Tougher competition for engineering jobs? Why? More engineers are educated or is it because an engineer costs 2-3$/hour in China?

[nostrademons]

Do they? I've found that my econ major friends bifurcated into two camps. Roughly the top 25% of the class found jobs on Wall Street, working at hedge funds, I-banks, and proprietary trading desks. They make much than engineers, often in the high six figures or even seven figures.

But the bottom 75% of the econ class - or even people in the top 25% who don't know how to schmooze and interview well - ended up in typical liberal-artsy jobs. They're working for government agencies and taking a public-servant salary. Or they're working as a bank teller instead of a bank trader. Or they're working as a tax preparer. Or they're working as a high school teacher or SAT tutor. Or they went back to grad school and are struggling to find any job at all.

These people make a lot less than a typical engineer. Heck, many of them don't make all that much more than someone who never went to college.

I think your question is really "Why do people in finance make so much more than those in software?" And the reason is that there's so much money floating around there that companies can afford to pay high amounts. I have a friend who works in reporting at one of the big hedge funds. His day job is to create pretty charts with Excel and correct typographical errors. His base salary is about $100K.

But if you're trying to decide between an engineering or hard science degree vs. an economics degree in college, your average expected payoff is way higher with a hard science degree, particularly since many of those people end up as quants on Wall Street anyway.

[skowmunk]

1) On an average anything that usually pays better money would require more hardwork.

2) There are more engineering jobs than jobs for economists, inspite of the recent layoffs because of the recession. I would feel safe saying that would remain so far into the future. (The recessions and depressions are an inevitable part of the economic cycle - they will always be there)

3) I believe the median pay for an engineer would be more than the median pay for an economist of comparable experience and proficiency(as in skill).

4) I agree with what nostrademons says, and to further go in that direction, the average pay of the top 1 percentile of economists may probably be higher than that of the 1 percentile of engineers, but if that percentile to be considered were to be raised to even just the top 10%, then I would imagine the average pay of the engineers would be higher than that of the economists.

5) Guess who are hired more at companies like google, microsoft, qualcomm, apple, etc, engineers or economists?

[skowmunk]

btw, in spite of the $2-3/hour engineers in China and India, there are a lot of engineers being hired in the US, good pay too.

And the well paid economists, get well paid only because they work hard enough to get into the best colleges and work hard enough to crack the toughest interviews.

:)

Cheers