Phd in Finance placement record contradicts with news.

Question

I investigate the options of going for a Phd degree after master of finance. I checked placement at Chicago and it seems 40% went to industry some stayed in Academia by taking nontenure tracked position. I also checked Stanford GSB placements back to 2001. less than 50% made tenure at their original placement schools. I feel the road in academia is bumpy. 

It is said there are strong demands for phd in finance. However, from what I found in placement stats, it doesn't add up. Maybe the demand number includes all the finance faculty position including teaching schools. These positions are generally not going to pay as well as research school: like 150+ as claimed. 

Am I right? Please comment, as I am at a cross road of decision.

hobbit · Answer

I can't comment specifically on the issue as i don't have any data relevant for finance. in my department I've seen (by names) about 80% of the phd graduates get a tenured position within 2-3 years. many (about 50%) at top universities.... but i'm not in finance... so i don't really know

on the other side... I can understand the data that you brought.
psychologically - if you know that some people get 150k for tenure track, and you offered a tenure with 90k only... you'd probably think it is not a good offer. in finance, you could easily find a job in the industry for 150k. so you leave academia. but it is YOUR CHOICE. many would love to get a tenure for 90k. but because you know you COULD, THEORETICALLY, earn more - it affect your choices and judgement.

not many universities can afford paying an assist. prof. a starting salary of 150k. not even 120k. there are of course exceptions - but if you narrow down your options, don't complain the road is bumpy.

if you are really into research you'd settle for 90k tenure track. you'll have plenty of choice (because most competitors will prefer industry). do some research, wait 2-5 years, establish your reputation - and then get the good positions.

bauble · Answer

It is bumpy -- there is no getting around that.

On the other hand, I wouldn't look at those stats too fatalistically. It's not as if the Stanford grads were facing a job flipping burgers (not that there is anything wrong with that) if they didn't make tenure. Some have personal reasons for taking a particular position in the first place, or they find a more suitable position. Perhaps a lot just don't make tenure clearly and simply, but I don't have a good grasp on the proportion for whom this is the case.

MBAFinance2 · Answer

Hobbit, you mean 80% got tenured track the position within 2-3 years after graduation, not get tenured after 2-3 years, right? If this means 40% get tenure tracked position at top universities, how many of them make tenure?

A lot of nice things about being a business school professor: high income, flexible life style etc all come with a tenured (associate or full) professor position at a very good business school. The question is: How much percentage of top finance (or other business ) program phd graduates make tenure at top universities. What is the tenure rate at top university?

Praetorian · Answer

This is a good question. I would be surprised if anyone publishes such stats. Every tenure case is different. I suppose this would be a good question to ask when you are interviewing with specific schools. Of course, you need to be more tactful in how you ask the question. 

I can tell you that the barrier to entry to the faculty of a top school is very high. For example, the top schools often "exchange" students among themselves. Sometimes, if you graduate from a top program, they might offer you a position within the department. For such schools, the pool of qualified applicants is very small. 

It is nice that you are thinking about these things so early.

hobbit · Answer

I'll give you my place in the small pool gladly

i am not aiming at top school tenure track. just a tenure track in my home country. I'll leave the US as soon as I finish my studies

MBAFinance2 · Answer

Hobbit, you are dodging my questions: Actually only 40% of the phd graduates find tenure tracked positions at top schools after 2-3 years right? What is top school? Top 30 or top 10? Do you know what a percentage of this 40% get tenured eventually?

Thanks,

hobbit · Answer

didn't mean to avoid answer....

most phd graduate from my department get tenure-track positions within 2-3 years of their graduation. many of them in top school - there were som ultra elites in the list, and some other known schools... I never paid much attention to rankings so can't tell if it's top 10 top 30 or top 50. these are schools that i've heard about, mostly good things (i.e. know some people who went there or seriously thought of applying there etc...)

i have no idea what is the actual tenure rate. i've heard it is tough. very tough.

cabro57 · Answer

Another thing is that people move from one place to another, so if someone has left his/her initial placement university it's not necessarily because he/she didn't make tenure. Whether they are still at "top" (any definition applies) schools is probably more relevant.

Moreover, you said you checked Stanford Finance PhD back to 2001 to see who got tenure at their initial placement school. Some schools have tenure clocks that are longer than 6 years, which I think is the norm across business schools. So seeing a "low" 50% tenure rate is at least in part caused by the fact that tenure decisions haven't been made yet for many of these graduates.

Finally, if you're a Finance PhD from Chicago, I think you can expect to make at least 150+ in industry. Some industry posts probably even pay more than Wharton!

Phd in Finance placement record contradicts with news.

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