The collapse of the econ PhD job market

State of the Econ PhD Job Market

• Many report a sharp, recent deterioration: hiring freezes at universities, US federal agencies (Fed Board, FDIC, CFPB, other regulators), and international bodies (IMF/World Bank‑type institutions) are flooding the market with senior economists and choking off new tenure‑track lines.
• Several anecdotes: interviews and flyouts canceled mid‑cycle; candidates pushed into postdocs; some top US departments cutting PhD cohort sizes dramatically.
• Commenters stress this is part of a broader contraction in academia (math, biology, chemistry, CS), not unique to economics, but econ is better at measuring and advertising it.

Structural Drivers: Universities and Funding

• Declining public funding, demographic cliffs, and political attacks on higher ed (e.g., threats to eliminate the US Education Department, conditions on federal funding) are seen as core causes.
• Debate over “administrative bloat”: some argue massive growth in non‑teaching staff is crowding out research and grad funding; others demand harder evidence and point to regulatory and student‑services burdens.
• Cheap graduate labor logic (oversupplying PhDs to staff labs) is said to apply less in econ than in lab‑heavy sciences, but econ PhDs are still vulnerable when grants and agency jobs shrink.

Economics vs. Data Science and AI

• Several see substitution by CS/data science: modern data science training overlaps heavily with econometrics; many econ dissertations are perceived as “fancy data‑cleaning plus models” that DS grads can replicate.
• Others argue econometric and causal‑inference skills remain distinct and valuable, especially when paired with domain knowledge; AI may amplify productive economists rather than replace them outright.
• There’s also skepticism that “LLMs can just answer” econometric questions without expert oversight or access to messy, proprietary data.

Methodology and Relevance of Academic Economics

• Strong internal critique of DSGE, rational‑agent microfoundations, and equilibrium math: many call this “cargo‑cult” or self‑referential, with weak predictive power compared to simple models or trader intuition.
• Intense flamewars over schools of thought:
  • Austrian economics is variously dismissed as non‑empirical, cult‑like, anti‑math, and politically libertarian; defenders emphasize individual choice and skepticism of state intervention.
  • Chicago/monetarist vs. Keynesian vs. Austrian distinctions are repeatedly clarified; some correct mislabeling of key figures.
• Broader question: is economics a real science? Critics say lack of controlled experiments and heavy reliance on unfalsifiable assumptions (rationality, perfect markets) make it closer to ideology; defenders compare it to meteorology or climate science with noisy, complex systems.

Politics, Inflation, and Trust

• The article’s claim that economists “lied about inflation to protect Democrats” is heavily disputed.
  • Some commenters agree public trust was damaged by “transitory” messaging and disconnect between CPI and lived costs.
  • Others note bipartisan responsibility (pandemic stimulus under both parties) and argue that mainstream forecasts, while imperfect, broadly matched a temporary shock that has since faded.
  • Data are cited showing inflation spikes were temporary in rate (not in price level), which confused the public.
• Several see the article itself as partisan, pointing to the author’s broader political writing and anti‑academic posture.

International Students, H‑1Bs, and Global Context

• Discontent from some US commenters about foreign dominance in PhD cohorts and perceived advisor bias toward co‑national students; others respond that global competition raises quality and often benefits the US economy long‑term.
• Question raised why, amid a “collapse,” institutions still sponsor H‑1B economists; responses argue many such roles are senior, specialized, or continuations of long‑term foreign hires, not direct substitutes for new US PhDs.

Meta: Value of Econ PhDs and Anti‑Intellectualism

• Some argue an “excess” of PhDs is good for innovation; many PhDs move into industry, finance, and policy, creating spillovers.
• Others see econ (and some other prestige careers) as a self‑referential prestige game with limited social value, now exposed by AI and budget cuts.
• Underneath is a broader sense that knowledge‑producing institutions are under coordinated political and economic attack, with economics both a target and, historically, a partial enabler.