Is Switching to a Financial Economics Major Worthwhile?

[Rhine720]

Hey just curious about the profitability of a business degree. I hear MBA's are very popular, what about the bachelors though? And how do these stand next to degrees related to money?

 

[away22]

Any good paying job that you could get with an undergrad business degree, you could just as easily get with any quantitative degree (eg. physics, engineering, math, stats, etc...). In fact, it may even be easier with a quantitative degree. MBAs are only worth anything if you get it at a top school (ie Harvard, Wharton, Stanford), and that's only because of the network and recruiting that those top schools have.

 

[Craß]

I'm working on International business, which pays fairly well if you're willing to travel anywhere at the whim of your employers.

 

[brownin]

By profitability, do you mean ROI? If yes, then business degrees do have a good return on investment provided you are smart about the choice of your program. A http://www.cc-sd.edu/bachelor-degree-business-accounting.html" , you’ll enjoy ample employment opportunities across a broad spectrum of industries.

 

[Feldoh]

A degree in business is profitable. I'm in a fraternity and from what I've observed it's a good career if you are a people person.

Generally speaking in business, I know it's cliche but, it's not about what you know but who you know.

Most of the business people in my fraternity have meet a lot of businessman by the time they graduate and from what I've been told all of the people who have graduated have been hired by people they met previously.

 

[twofish-quant]

Hey just curious about the profitability of a business degree. I hear MBA's are very popular, what about the bachelors though?

Business degrees are extremely profitable. Just look at the balance sheets for University of Phoenix, and the margins on their degrees are just incredible...

Oh... You meant for the student. Hard to say...

 

[Feldoh]

I'd just like to add that business/accountancy to tax law is extremely extremely profitable.

 

[Shaun_W]

Business degrees are for people that want to drink like fish and play poker who weren't clever enough for something involving lots of maths like economics.

 

[Feldoh]

Business degrees are for people that want to drink like fish and play poker who weren't clever enough for something involving lots of maths like economics.

Wow that is an incredibly negative outlook. Perhaps people choose it because they LIKE doing it. Just because someone doesn't pick a particular field doesn't make them unintelligent.

 

[Shaun_W]

Wow that is an incredibly negative outlook. Perhaps people choose it because they LIKE doing it. Just because someone doesn't pick a particular field doesn't make them unintelligent.

No.

I have already explained that people choose business degrees because they are philistines who weren't good enough at maths to do economics. The low work-load is a huge bonus as it facilities more opportunities for heavy drinking, sleeping until 2pm, and getting laid with other people in the same predicament. A lot will never manage to secure a decent job in 'business' because a business degree screams out to employers that you're too thick to do economics, maths, a science or a respected humanity like history or politics. Some of the rich kids, like nice but dim Tim, did it because they are being groomed for a nepotistic job in the family business, or one of daddy's friend's businesses, and at least their degree means they can tell their elbow from their arse.

 

[stewartcs]

No.

I have already explained that people choose business degrees because they are philistines who weren't good enough at maths to do economics. The low work-load is a huge bonus as it facilities more opportunities for heavy drinking, sleeping until 2pm, and getting laid with other people in the same predicament. A lot will never manage to secure a decent job in 'business' because a business degree screams out to employers that you're too thick to do economics, maths, a science or a respected humanity like history or politics. Some of the rich kids, like nice but dim Tim, did it because they are being groomed for a nepotistic job in the family business, or one of daddy's friend's businesses, and at least their degree means they can tell their elbow from their arse.

That's a load a crap. There are certainly many intelligent people who studied Business Administration.

CS

 

[Shaun_W]

That's a load a crap. There are certainly many intelligent people who studied Business Administration.

CS

Looking at the grades of people who studied it at university demonstrates that, aside from a few exceptions (I guess some clever people are quite lazy), that is not the case.

 

[twofish-quant]

A lot will never manage to secure a decent job in 'business' because a business degree screams out to employers that you're too thick to do economics, maths, a science or a respected humanity like history or politics.

Just a quick question. Have you ever worked in business? I have.

Something you quickly find out is that in order to get a company working, you need some very good social skills. In your average large corporation, being super-smart is totally useless if people don't like working with you, and if you can't work with anyone else.

Some of the rich kids, like nice but dim Tim, did it because they are being groomed for a nepotistic job in the family business, or one of daddy's friend's businesses, and at least their degree means they can tell their elbow from their arse.

Ummmmm no...

What happens frequently is that people with engineering and science degrees go out into industry and find that the companies are run by MBA's, and they are run by MBA's because having good social and political skills is pretty much essential if you want to run a big corporation. So what then often happens is that rather than seeing "social skills" as something valuable and something you can learn, said engineering and science degree-holder gets really resentful that the world doesn't work in the way that they think it should work.

 

[twofish-quant]

Looking at the grades of people who studied it at university demonstrates that, aside from a few exceptions (I guess some clever people are quite lazy), that is not the case.

Grades are almost totally meaningless once you get out of academia and have worked a year in a company.

 

[twofish-quant]

Business degrees are for people that want to drink like fish and play poker who weren't clever enough for something involving lots of maths like economics.

Drinking like a fish and playing poker are pretty much the skills that you need to run a business.

 

[Shaun_W]

Just a quick question. Have you ever worked in business? I have.

Something you quickly find out is that in order to get a company working, you need some very good social skills. In your average large corporation, being super-smart is totally useless if people don't like working with you, and if you can't work with anyone else.

You do not require a business degree to acquire these social and communication skills. They should be acquired as part of any other degree that involves lots of team and project work, and can also be acquired in part-time work, through socialising, etc.

I believe that a lot of these skills are also largely natural, too. And people that naturally possesses these skills sure as hell don't need a business degree.

Ummmmm no...

What happens frequently is that people with engineering and science degrees go out into industry and find that the companies are run by MBA's, and they are run by MBA's because having good social and political skills is pretty much essential if you want to run a big corporation. So what then often happens is that rather than seeing "social skills" as something valuable and something you can learn, said engineering and science degree-holder gets really resentful that the world doesn't work in the way that they think it should work.

Not all companies are run by MBAs, and aren't MBAs something mainly pursued by people who aren't from a business undergraduate background? I know engineering firms are often really keen to put those engineers who have been earmarked for future leadership development through MBAs, fully funded. Probably something that I'll do one day, too.

Grades are almost totally meaningless once you get out of academia and have worked a year in a company.

You're missing the point.

Drinking like a fish and playing poker are pretty much the skills that you need to run a business.

All of the business leaders I know, albeit not that many, work extremely hard - so hard that the typical business student would have a stroke if they were to hear about the hours they put in.

 

[Ben Espen]

Drinking like a fish and playing poker are pretty much the skills that you need to run a business.

Amen to that brother. The best part is the drinking and gaming counts as work. Sometimes the long hours are worth it. [sometimes] One should add the ability to shake off the deleterious effects of Ambien after an international turn-and-burn trip.

Running a business seems easy until you try it. When I was younger, I had a great deal of disrespect for folks planning a career in business, but now I see them as valuable partners in enterprise that allow me to concentrate on what I do best. I'm glad I don't have to know how to do everything myself.

 

[stewartcs]

Looking at the grades of people who studied it at university demonstrates that, aside from a few exceptions (I guess some clever people are quite lazy), that is not the case.

So you are privy to business student's grades then?

I see no correlation between being lazy and studying business - it's just a different field that appeals to different personalities.

CS

 

[Shackleford]

Running a business is not easy. You're naive if you think that.

 

[Shackleford]

So you are privy to business student's grades then?

I see no correlation between being lazy and studying business - it's just a different field that appeals to different personalities.

CS

A key ingredient in business is having "personality." I would suspect the more reticent and reserved folks tend to the sciences. Those who have "personality," such as a Feynman, excel even more so.

 

[twofish-quant]

Just a question. Should I assume here that you've never actually worked inside a business?

My prediction is that in a few years, you will be complaining and resentful that the people that drink like a fish and know how to party are getting further in their careers than you are. You'll be talking about how it "isn't fair" that you got the grades, you did the work, you are smarter, and they are getting the money and the jobs.

This is how business works. If you want maximum money for minimum work then science and engineering is a horrible path to take. If you think that in the end you are going to get rewarded financially or in social status for spending the extra time and effort to do science and engineering, you are also deluding yourself.

You do not require a business degree to acquire these social and communication skills.

You don't, but it helps. Also, business degrees give you some basic skills like reading a balance sheet and basic organizational theory. There are other ways of getting those skills, but if you go for a technical degree, you do have to realize that you will be deficient in some of those skills and actively look for ways of improving.

They should be acquired as part of any other degree that involves lots of team and project work, and can also be acquired in part-time work, through socialising, etc.

They can. But I'm not sure about should. If you really like physics, then study physics. If you really don't care about physics and math (and most people don't care about physics and math) and you just want a degree that gets you some basic skills that gets you a job so that you don't starve to death, then a business degree is a reasonable thing to get.

I believe that a lot of these skills are also largely natural, too. And people that naturally possesses these skills sure as hell don't need a business degree.

Actually they may. Something that you'll find out is that sometimes you just need the piece of paper to get past the gatekeeper. You may find yourself in a situation in which HR just tosses the resume of anyone that doesn't have an MBA, and being good at social and politics, you get the MBA.

Not all companies are run by MBAs, and aren't MBAs something mainly pursued by people who aren't from a business undergraduate background?

Any large company has a ton of MBA's in middle management. MBA's are terrible training for people that want to start their company, but if you have a 200,000 person company, you are going to need a ton of corporate bureaucrats, which is where an MBA comes in.

I know engineering firms are often really keen to put those engineers who have been earmarked for future leadership development through MBAs, fully funded. Probably something that I'll do one day, too.

Sure. If you like engineering then do engineering. If you hate engineering, don't like math, and want to make the maximum money for the minimum effort (i.e. most people) then a business degree is a good way to go.

I'm a geek. Most people aren't. I like to think. Most people don't. I like to ask questions. Asking questions can get you in trouble in a big bureaucracy.

One thing that I have to do to get anywhere in business is to convince my bosses, that in the end, I will follow orders. If you have someone that is less intelligent, they are more likely to follow orders without thinking about them, and more likely to get hired to be a corporate bureaucrat.

Personally, I think that people talk too much about leadership. The problem with leaders is that you don't need that many of them, and you are more likely to be a follower than a leader.

Also, the job of a business leader is to get other people to do work so that he or she can take credit for it, and then make the people that did the work feel good about that situation. It's not a coincidence that more political leaders have been actors than engineers since acting probably gives you more useful skills to be a leader than engineering school.

All of the business leaders I know, albeit not that many, work extremely hard - so hard that the typical business student would have a stroke if they were to hear about the hours they put in.

Sure. But the MBA is not intended to train business leaders. One important fact is that you really don't need that many leaders in a company. If you have a company with 200,000 people, you only have one CEO, and maybe 100 senior managers. You also have about 50,000 mid-level and junior level corporate bureaucrats, and those are the spots that you want people with business degrees in.

If you want to spend years of your life fighting to get to the top then that's great, but most people aren't like that, and maybe that's a good thing. If you have a company with 50,000 people each thinking that they should be CEO, then you'll find that those places tend to be extremely unpleasant places to work.

You don't need Albert Einstein to be a regional divisional manager, and probably you don't *want* Albert Einstein to be a regional divisional manager. Einstein is going to get bored and annoyed, and maybe it's better for society if he think about relativity than about getting the fonts on the powerpoint right. But most people aren't Einstein, and most people really don't want to be Einstein.

 

[PhDorBust]

Cmon guys, are you really saying the average business student is anywhere close to the average math/physics student?

Business degree is cake.

 

[twofish-quant]

Cmon guys, are you really saying the average business student is anywhere close to the average math/physics student?

The average business student is nowhere as good at mathematics as the average math/physics student.

My point is that it doesn't matter when it comes to get a job. For the type of jobs that business students do, technical intelligence really isn't an important qualification, which causes a lot of resentment when math/physics students find themselves taking orders and making less money.

 

[Ben Espen]

Cmon guys, are you really saying the average business student is anywhere close to the average math/physics student?

Business degree is cake.

As surprising as it may be, there are useful and important skills that have nothing to do with quantitative reasoning. Some of these skills are nonetheless intellectual, but many are not. One of the most informative nights I spent drinking at work I was talking with the sales guys and learning what it was they did and how they did it. I can design a great product, but without them all I would have is a pile of plastic and metal. Closing a deal and keeping your customer happy are real skills that are a sight to behold when done well. I know one of those sales guys has a math degree, but I have a hunch he does not impress customers with his proofs.

 

[Feldoh]

Cmon guys, are you really saying the average business student is anywhere close to the average math/physics student?

Business degree is cake.

For the last time what you choose to do in college does not correlate to ones inherent knowledge.

 

[Shaun_W]

So you are privy to business student's grades then?

I see no correlation between being lazy and studying business - it's just a different field that appeals to different personalities.

CS

Yes am privy to the average grades achieved by businesses students at different universities because the data is published in my country.

I'll explain the correlation later because it closely relates with the below post.

Just a question. Should I assume here that you've never actually worked inside a business?

My prediction is that in a few years, you will be complaining and resentful that the people that drink like a fish and know how to party are getting further in their careers than you are. You'll be talking about how it "isn't fair" that you got the grades, you did the work, you are smarter, and they are getting the money and the jobs.


This is how business works. If you want maximum money for minimum work then science and engineering is a horrible path to take. If you think that in the end you are going to get rewarded financially or in social status for spending the extra time and effort to do science and engineering, you are also deluding yourself.


You don't, but it helps. Also, business degrees give you some basic skills like reading a balance sheet and basic organizational theory. There are other ways of getting those skills, but if you go for a technical degree, you do have to realize that you will be deficient in some of those skills and actively look for ways of improving.



They can. But I'm not sure about should. If you really like physics, then study physics. If you really don't care about physics and math (and most people don't care about physics and math) and you just want a degree that gets you some basic skills that gets you a job so that you don't starve to death, then a business degree is a reasonable thing to get.



Actually they may. Something that you'll find out is that sometimes you just need the piece of paper to get past the gatekeeper. You may find yourself in a situation in which HR just tosses the resume of anyone that doesn't have an MBA, and being good at social and politics, you get the MBA.



Any large company has a ton of MBA's in middle management. MBA's are terrible training for people that want to start their company, but if you have a 200,000 person company, you are going to need a ton of corporate bureaucrats, which is where an MBA comes in.



Sure. If you like engineering then do engineering. If you hate engineering, don't like math, and want to make the maximum money for the minimum effort (i.e. most people) then a business degree is a good way to go.

I'm a geek. Most people aren't. I like to think. Most people don't. I like to ask questions. Asking questions can get you in trouble in a big bureaucracy.

One thing that I have to do to get anywhere in business is to convince my bosses, that in the end, I will follow orders. If you have someone that is less intelligent, they are more likely to follow orders without thinking about them, and more likely to get hired to be a corporate bureaucrat.

Personally, I think that people talk too much about leadership. The problem with leaders is that you don't need that many of them, and you are more likely to be a follower than a leader.

Also, the job of a business leader is to get other people to do work so that he or she can take credit for it, and then make the people that did the work feel good about that situation. It's not a coincidence that more political leaders have been actors than engineers since acting probably gives you more useful skills to be a leader than engineering school.


Sure. But the MBA is not intended to train business leaders. One important fact is that you really don't need that many leaders in a company. If you have a company with 200,000 people, you only have one CEO, and maybe 100 senior managers. You also have about 50,000 mid-level and junior level corporate bureaucrats, and those are the spots that you want people with business degrees in.

If you want to spend years of your life fighting to get to the top then that's great, but most people aren't like that, and maybe that's a good thing. If you have a company with 50,000 people each thinking that they should be CEO, then you'll find that those places tend to be extremely unpleasant places to work.

You don't need Albert Einstein to be a regional divisional manager, and probably you don't *want* Albert Einstein to be a regional divisional manager. Einstein is going to get bored and annoyed, and maybe it's better for society if he think about relativity than about getting the fonts on the powerpoint right. But most people aren't Einstein, and most people really don't want to be Einstein.

I'll respond to this post later because I'm a bit busy at the moment, but you certainly raise a lot of valid points and I am glad that this discussion is not going down the road of a flame war.

 

[Shaun_W]

Okay guys this is why I think that an undergrad business degree (just to clarify that I'm not talking about an MBA) is a waste of time, and for people who are either lazy or not that bright.

I'm from the UK and here the average grades (converted into "UCAS points") of the students on each course at each university are published every year on http://unistats.direct.gov.uk/" . From this it is clear that those on business degrees achieved generally lower grades than their STEM, languages, economics and history counterparts. Some at the top institutions aren't that far behind, but plotting average entry UCAS points against each university would reveal that business tends to quickly drop off, whereas with STEM the line is much more gentle slope.

Secondly, in my first year of university I lived with some business and management students. That is where I formed my opinion - that they drink like fish and have very easy classes.

Now, some have said or implied that a business degree is the best road into "business", and that engineering only leads to being an engineer or something technical. Not so! Let's look at a recent survey on graduate employment in the UK. The most important statistic in that survey for this discussion is that only one third of graduate jobs require a specific degree. It's safe to say that a lot of these jobs will be things like doctors, vets, engineers, and other jobs that require highly vocational degrees. The vast majority of the generic jobs like admin roles, sales people, business people, managers, that only recruit graduates do not actually require. So for the majority of jobs that a university graduate will apply for, it doesn't matter what they studied, just that they were successful at it.

The BBC link also says that for every graduate job there are on average 69 applicants. And these applicants will have all sorts of degrees - there'll be physicists applying for administration jobs, there'll be history and literature graduates applying for economist jobs, there'll be computer science graduates applying for tax auditing jobs, and chemistry graduate applying to law firms. May I add that engineering graduates are just as likely as accounting graduates to work for one of the big 4 accounting firms. May I add that there are a huge amount of STEM graduates working in banking, finance and business consultancy. These industries highly value the skills taught on these STEM degrees, and it's really not surprising that more electrical and electronics engineers work in finance than in engineering.

So what you study is pretty much irrelevant, as long as you're good at it. Well, not really, because there are certain degrees that employers know do not produce graduates of the highest calibre. And this is where business studies comes in.

A lot of these banking, finance, management and business consultancy jobs have many filters in place, to reduce the huge burden of applicants they receive each year. One of these filters is that candidates must have achieved a certain amount of those UCAS points in their high school exams - 300 is the typical number; a fairly modest amount (I have 325 and when I was 14-16 I was more interested in girls and sports and did poorly in everything apart from physics and computing [yes even maths]). Now if you were to look at the average UCAS points of each business studies course, you will see that a significant amount of below the level required to even be eligible for a lot of these jobs that one expects someone studying business to go for.

This is confirmed when the employment statistics for six months after graduation are looked at. Business has an abysmal rating, whereas STEM is typically above 80% (my degree at my university is apparently 92%). If you look at that Unistats website again you can actually see the destinations of graduates from each degree, and you'll notice that a huge amount of STEM ones end up in the very jobs you'd expect business studies graduates to be in.

So that's why my opinion of an undergraduate business degree is what it is.

 

[twofish-quant]

Okay guys this is why I think that an undergrad business degree (just to clarify that I'm not talking about an MBA) is a waste of time, and for people who are either lazy or not that bright.

Something that you have to get used to is that as a society you have to figure out what to do with people who are lazy or not that bright, and something else that you will have to get used to is that sometimes people who are lazy and not that bright have skills that happen to be more useful than people who work hard and are super-intelligent.

May I add that there are a huge amount of STEM graduates working in banking, finance and business consultancy. These industries highly value the skills taught on these STEM degrees, and it's really not surprising that more electrical and electronics engineers work in finance than in engineering.

What you will find that people with technical degrees in finance tend to have lower status than people with business and sales background. The people with engineering background run the machines, but they get orders from people with people and social skills. If you think that you are God's gift to business because you are smarter than the people around you, then you will go nowhere, even if you are smarter.

If you are an electrical engineer that gets hired by a bank and you just rely on the skills that you learn in your degree, you will go nowhere. You'll just stay where you are until your job gets sent over to India to be done by someone that can do it five times as cheap as you can, and its the business people that will be making the decisions about whether you get fired or not.

What you will *need* if you want to advance in your career are business, social, and political skills, and that often means learning those skills from a business major who is just better at that sort of thing that you are. Personally, I think this is cool, since I like learning new stuff. But there are a lot of engineers that look down on business majors and then get extremely resentful when they find out that it's those business majors that are making the decisions, because those majors have skills that the engineer just doesn't have.

Something that I've had to learn is when not to look like a Ph.D. Sometimes it's a good thing to look like a technical person. Sometimes it's not. Personally, I think it's sort of fun to act like someone else, so I do enjoy putting on the three piece suit, getting the powerpoints ready, and then pretending that I'm an MBA. But I'm really not that good at it.

So what you study is pretty much irrelevant, as long as you're good at it. Well, not really, because there are certain degrees that employers know do not produce graduates of the highest calibre. And this is where business studies comes in.

Every hear of the term "overqualified"?

Something that you have to understand is that often employers are not looking for graduate of the highest calibre. Being "too smart" can get your application passed over, and it gets you passed over for good reason. A lot of jobs in business just amount to pushing papers, and people who are too smart often quickly get bored with these jobs.

Most companies don't try to get the "smartest" people. They establish a minimum requirement, and then they look at people past that threshold. Often they don't want to hire people that are too much over their minimum requirements because if you get someone super-smart for a job that you don't need to be super-smart then you are overpaying.

 

[twofish-quant]

Also you need to look at numbers. There are a *LOT* more business graduates than engineering graduates, so looking at the fraction of STEM graduates that end up in finance is not that useful. One other way of looking at the stats is that STEM graduates end up in finance because there aren't enough jobs in traditional engineering. Finance was certainly not my first choice of careers. I think it's a blast, but one person's heaven is another person's hell, and I know no small number of physics graduates in finance that *HATE* their jobs. One reason I like my job is that I like learning new stuff, and learning how to wear a suit and talk business-speak is fun. It's like playing dress up.

Also, I feel like I need to push-back a little on this effort to "sell" math and science jobs. Personally, if your goal is to make as much money as possible for as little effort as possible, then math and sciences is a stupid thing to study. You shouldn't study math, science, or engineering for career reasons. There are a lot easier ways of making more money, and it's likely that some of the business majors you are looking at are going to make more money and find it easier to get a job than you are.

Physics is not my job. Physics is my life. It so happens that I can avoid starvation by using some skills I learn in physics. But that's a poor reason to study it.

 

[Mathnomalous]

I agree with TwoFish-Quant (post #21). I am still learning the hard way that a good employee = a sheeployee.