Health economists work in a branch or division of economics that studies the supply and demand of health care. As an economist in the health industry, your main focus in on cost effectiveness. This typically means one of two things – treating the most patients with a certain amount of resources or treating a certain number of patients at the least cost. Overly simplified, yes, but that’s the general idea behind health economics. Those with a background in this discipline are often paid handsomely for their knowledge and abilities.
In 2011, half of all economists earned at least $90,550 a year, according to the U.S. Bureau of Labor Statistics. The top 10 percent of earners made in excess of $155,490 a year, while the bottom 10 percent made no more than $50,120 a year. None of these figures, however, account for a specialty.
A survey published in a 2007 issue of the “Journal of Health Economics” found that salaries vary by sector. In academic settings, for example, health economists earned an average of $114,573 a year. The median wage -- or midway point of all salaries -- was closer to $100,000 annually. Those in nonacademic settings earned an average of $128,566 a year. But the median was $118,500 annually.
The relatively high salaries have a lot to do with education. Employers prefer to hire economists with at least a master’s degree, if not a Ph.D. It can take several years to earn this level of education. A master’s degree, for example, can take two to three years of additional study after earning a bachelor’s degree. For a Ph.D., you’re looking at another four years, according to the University of Northern Iowa.
Through 2020, employment opportunities for all economists will improve by only 6 percent, reports the BLS. This is much less than the expected average growth for all U.S. occupations -- an estimated 14 percent. Though businesses rely on economists to forecast trends, budgetary limitations constrain the growth of this profession. Those with a master’s degree or Ph.D. will see the best prospects. The market for those with only a bachelor’s degree will likely be limited.
- Bureau of Labor Statistics: Occupational Outlook Handbook – Economists
- Bureau of Labor Statistics: Economists
- Journal of Health Economics: The Earnings of U.S. Health Economists
- University of Northern Iowa: How Long Does it Take to Earn a PhD in Economics?
- University of Oxford Medical Sciences Division: What Is Health Economics?
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