Industry or Academia

splenium · August 24, 2011, 9:06am

The difference between the pay of a tenured professor (or even an assistant professor) and someone who has been in industry a comparable amount of time is small or nonexistent. The big difference comes during the postdoctoral years when you can make a factor of 2-3 more in industry.

The financial reason that postdocs are so common in lab sciences is that a biologist is much more expensive to hire as an assistant professor than an economist. An economist just needs a salary, an office, and maybe a small amount of money for computers and travel. New biologists regularly get startup packages of close to $1 million to cover lab equipment, supplies, and salaries of people to work in the lab, and they require much more space and often specialized facilities. Universities aren’t willing to make this kind of a financial investment on new PhDs. It does make the road much longer/harder for a biologist coming up the ranks. On the plus side, tenure rates tend to be higher for the life sciences because a lot of the weeding out is done earlier.

Momwaitingfornew · August 24, 2011, 9:24am

@Brahmin: A lot depends on your field and your credentials. Academics in the humanities in general make less and teach more than their counterparts in the sciences, but then again, the university doesn’t have to compete with industry to hire them. They don’t partially self-support with the kind of grants expected from researchers in the sciences. Academics in the arts can sell their own work/performances to supplement their income. Academics in the sciences can consult as experts to increase their income. These extra sources of income cannot detract from full-time employment at the university – that is, you cannot put in 30 hours as a professor and 30 hours as a consultant if you have been hired as a full-time academic. When a professor is hired as a consultant, he sets his own hourly rate, so how lucrative the work is depends on the demand for that particular person; however, he cannot do this work using university equipment and resources. When a company comes to a university to solve a problem, chances are that the professor receives no compensation for it and instead uses the opportunity as a learning tool for his/her students.

scaleupchem · August 24, 2011, 10:10am

In industry, we own no intellectual property. And I want to just educate some on what IP is . IP is a patent received on any technology development, also know as an “invention”. So, if I developed a new process to extract sugar from sugar cane; or, if I develop a new way to use a waste material to produce a needed raw material, I can get IP protection on my new process and developments. Then after I file for the patent, and if it is granted, I can make money off of my invention by liscensing my technology to anyone who wants it. Most inventions (everything you do new in industry is an invention) in industry is covered by a several shells of IP, from the artwork, to the manufacturing, to the process, to the technology itself is patentable. The company is asking you to develop its processes, understand the process transformations, design artwork, and desing new technology for them to make money off of all the liscensing rights from the patents. So you can make a boat decent money, but you give up far too much.

Also, consider work life balance. In academia, you get the summers off. In industry, you work like a whipped slave for your company (10-15hr days), and there is little to no work life balance. Very few mid level managers even take off days or vacations. I know several mid level managers who haven’t had a day off in 5 years. No dollar amount is worth robbing me of my sanity, and the balance in my life.

nwcrazy · August 24, 2011, 4:04pm

*Brahmin, I’m going to make it simple for you. Given the two choices, academia or industry, the way to have a chance for something great is obviously academia.

Companies own everything you do. But most research universities allow the discoverers major ownership. I did some bioinformatics software development for a professor a while back and let me tell you that I’ve met several profs who were rich, from licensing technologies to co-founding companies. Most large universities have technology commercialization centers that help employees create companies. The universities take a small stake, but provide the business and legal expertise.

But even though academia gives you the best opportunity to make it big, it’s not easy. First, you still have to be really brilliant (compared to your peers) OR you are able to play politics better than the politicians.

BTW my brother is a brilliant, but glorified post-doc (ie research scientist) at a university and has recently co-founded a biotech company. He doesn’t like politics; but he’s so freakin’ smart that the company would not be viable without his research and brains.

You should note that most scientists that make it big didn’t look for fame or fortune when they started. If they’re truly brilliant, opportunities just fall into place for them. So if fame and fortune is important, getting a Harvard or Stanford MBA would be a better choice, not a Ph.D in the sciences.

MaceVindaloo · August 24, 2011, 5:59pm

The only way you have summers off in academia is if you only teach (a lecturer or professor at a non-research school), and I am not sure what the obligations are like in the summer in those cases. I think the point is that in any job where you are in charge of a research team, expect to work long hours and have ill-defined time off.

sakky · August 24, 2011, 9:33pm

While biology research (or science research in general) may be more expensive to conduct than is economics research, it is not clear why that should necessarily translate into remarkably long stretches of postdoc-dom within the academic biology career structure. Biology labs are certainly expensive, but most of that expense is (or should be) borne not by the universities themselves, but rather by grant funding agencies such as the NIH or NSF. A university could therefore structure their biology faculty career path such that newly hired faculty are relegated to a relatively low-cost and low-end common lab facility until and unless they are able to obtain grant funding, upon which only then could they ‘graduate’ to better facilities and can actually afford to fund their own staff, PhD students, and postdocs. Hence, a new biology asst prof who never wins any grants and is therefore terminated after his initial contract expires (usually after 2-4 years) would represent only a minor financial loss to the university because he was never given a large lab or staff. The university would lose only the salary of that faculty along with the common-lab resources that he consumed, and that loss is likely to be comparable to the financial loss of an unsuccessful junior economics professor who is terminated.

But the even larger fundamental question is why do academic biologists (or scientists in general) need to have their own distinct lab or correspondingly distinct and individual research agenda for which they are the ‘principal investigator’ in order to be junior professors in the first place? Why can’t current biology post-docs (especially the 7th year ones) be considered “professors”, with the corresponding professor salaries and perqs? Why can’t you be a professor while working on somebody else’s lab as opposed to running your own, where that somebody else is the true principal investigator? Again, economics has no such requirement. There are assistant professors of economics not only at average programs but also at even the top departments such as Harvard and MIT who have yet to research anything for which they can truly lay distinctive intellectual claim comparable to the equivalent of the science’s ‘principal investigator’: all the research they have are collaborations with their former advisors for which those advisors served as the animating force. It is only when those assistant professors approach the tenure threshold do many of them finally develop a distinctive and individual research agenda. {And many of them fail to do so and therefore fail their tenure reviews.}

The upshot is that these “assistant professors of economics” are little more than highly glorified “post-docs” in the sense that they are still working on the research directed by their (former) advisors. But those post-docs are highly glorified indeed, as they are accompanied by the higher salaries and benefits of being an actual faculty member. {As a simple case in point, practically every economics assistant professor at any respectable school will have their own private office with a lockable door. The office might be small and dingy but at least it will have a door you can close and lock. How many science postdocs can say the same?} More saliently, those economics departments seem to have no problem in assigning economics courses, including graduate-level courses, for these assistant professors to run.

All of this would be understandable if economics academia produced greater social value-add than do the biosciences. If that was the case, then it would be entirely justified for the economics career structure, especially at the junior level, to be far more lucrative and pleasant than the bio career structure. But is that truly the case? Frankly, it’s not clear that economics research has ever produced anything of social value comparable to the cures and treatments of diseases that the biosciences do. {Again, with apologies to mollie for perhaps becoming too personal, she is working on research that may ultimately be able to restore function to people with spinal cord injuries. If she succeeds, she breathe vitality into the lives of of millions of injured people around the world. How many tenured economists, let alone mere economics grad students, can say the same?}

sakky · August 24, 2011, 9:52pm

Actually, the most straightforward way to have summers off (and, frankly, plenty of other time off throughout the year) while in academia is to simply obtain tenure. Once you have tenure, then as long as you are continuing to meet the most basic teaching and administrative responsibilities, you can basically do anything you want in the summer. If you don’t want to do any research at all in the summer, or heck, any research at all ever again, you simply don’t. (I can think of numerous tenured professors at even the top schools who haven’t published any research papers in years.) Or if you do want to conduct (potentially low-quality) research through the summer, but only show up to the lab once or twice a month (hence why the research is low-quality), you can choose to do that. The granting of tenure means that it no longer matters how unproductive your research is.

molliebatmit · August 24, 2011, 10:16pm

There are systems like this, at least at some institutions – at MGH (and I think at HMS more broadly) many fifth-year+ postdocs are given the title of “instructor”, which is technically a non-tenure-track faculty position, although they’re generally still working for their postdoctoral advisor in his/her lab. I’m not sure what the pay bump is for a late-year postdoc vs. an instructor. And, unfortunately, the instructors who have been in my lab don’t have offices. :)

Anyway, I was talking about this issue with another grad student in my lab, and his opinion is that the biology system exists because biology overproduces grad students and therefore postdocs. It’s somewhat trivial to be supported by a training grant or fellowship from NIH or a private foundation as a grad student or postdoc, which incentivizes programs to accept more students than they perhaps would if they had to pay for more students from departmental money. (Are we right in thinking that social sciences grad students, other than those who have external funding, are generally funded by departmental funds?) And then PIs are incentivized to keep grad students and postdocs as a highly-trained labor force.

sakky · August 25, 2011, 1:41am

Actually, I’m not sure that I even agree with the premise of this argument, at least with regards to economics (although it might be true of other social sciences such as poli-sci) and with regards to elite-level PhD programs (such as Harvard biology or Harvard economics) Let’s face it - economics is not exactly a small field. Harvard’s pure economics program alone produces ~20 new PhD’s every year, and that’s not even counting the ‘hybrid’ economics PhD’s conferred by other programs such as at Harvard Business School or the Kennedy School. MIT’s economics department conferred a whopping 25 new PhD’s last year, and that’s not even counting the Sloan management PhD’s who specialize in economics methods and are effectively economists in all but name. So I’m not entirely sure that there’s really that much overproduction of biology PhD’s relative to economics PhD’s that could explain such a vast gulf of post-doc-hood.

We should also keep in mind that the NSF also provides fellowship funding for the social sciences, and many (almost certainly most) of the students at top social science PhD programs such as Harvard and MIT have won NSF or other outside funding. If you’re good enough to be competitive for a top social science PhD program, you’re probably good enough to win extensive outside funding. In fact, I can think of a number of economics PhD applicants who won extensive outside funding yet were still rejected by the top programs such as Harvard and MIT (and hence ended up at places like BU or BC, but have freely admitted that they would have gone to Harvard/MIT if admitted). That funding meant that Harvard/MIT could have admitted these applicants for little extra cost, so why didn’t they? Why don’t Harvard/MIT or other top programs overproduce what the market will bear for elite economics PhD degrees?

Note, the reason why I keep pounding on the top programs as opposed to all programs is that economics academia, just like most academic fields, is highly elitist and brand-name driven. It’s extremely rare for a job market candidate from an average economics PhD program to even get a job talk at Harvard/MIT or other top economics department, let alone an actual job offer. What that also means is that a Harvard/MIT economics PhD student is well-assured that he will obtain a tenure-track job offer somewhere at some school, and often times at a top department, and usually without ever serving a postdoc. For example, of the 20 pure economics PhD graduates produced by Harvard last year, 10 of them secured a tenure-track position at an elite economics department or business school, and of those 10, 8 of them did so without ever having to serve an intervening post-doc (with the other 2 serving a post-doc for merely a single year). Even of those who didn’t place at top departments, some may have done so by choice, instead taking a high-prestige NGO job such as becoming a staff economist at the Federal Reserve. Similarly, generally around 40-50% of MIT economics PhD graduates will place at top 10-15 economics departments or business schools.

But a PhD in biology from Harvard or other top program enjoys no such comparable opportunities. Apparently they have to serve years of low-paid postdocs for any realistic chance of academic placement at all. And that’s terribly sad.

[MIT</a> Department of Economics : Graduate Program : Career Placement](<a href=“http://econ-www.mit.edu/graduate/ph.d./career]MIT”>http://econ-www.mit.edu/graduate/ph.d./career)

<a href=“http://www.economics.harvard.edu/files/Placement-2010-2011.pdf[/url]”>http://www.economics.harvard.edu/files/Placement-2010-2011.pdf</a>

But one would think that the same would be true within the economics profession. After all, one would imagine that economics advisors would similarly want to shackle their grad students and post-docs to their desks as a highly trained labor force to run their econometric regressions and build their analytic models for them, while they reap the publication credit.

But again, for some reason, that doesn’t really seem to happen. Economics post-docs are few and far-between, generally unnecessary as most current junior economics professors jumped straight from their PhD to a faculty position without ever having served a postdoc, and short in length - I have never heard of an economics postdoc lasting more than 2 years.

Let’s also keep in mind that economics faculty are not exactly cheap to employ. Often times, they’re among the most well-paid in the entire university. Austan Goolsbee made over $450k a year while at Chicago. Full professors in economics often times make twice or even triple what full professors of biology make. {Granted, biology research may cost more than economics research to conduct, but that research is supposed to be funded by outside grants rather than the universities themselves.}

And again, the core issue is that biosciences research has had a history of producing clear positive social value-add. Maybe one could argue that it hasn’t produced sufficient value-add relative to the investment, but it’s hard to argue that it hasn’t produced some positive value-add. The social value-add that economics research has provided is questionable at best and in the case of financial economics research over recent history, is almost certainly a net negative to society.

Here’s a thought experiment: what if we had taken all of the funding devoted to producing papers published in The Journal of Financial Economics (JFE) and The Journal of Finance over the last generation touting the supposed merits of financial innovation and instead had given it to Mollie and her group for her research. Not only might the nation not be struggling with 9-10% unemployment, but Mollie might have cured paralysis and ALS (Lou Gehrig’s disease) by now.

MaceVindaloo · August 25, 2011, 11:12am

sakky:

You COULD do that with a tenured position, but that isn’t the norm. I think to say that academia allows summers off implies that it is somehow part of the position, but that is not true.

tetrahedr0n · August 25, 2011, 1:06pm

If you go back and read through sakky’s many posts, you’ll note that he consistently brings up the idea that essentially every single tenured professor goes on a (paid) 3-month vacation every summer, and that this is one of the key advantages of academia. Evidence to the contrary will be dismissed in favor of some anecdotes about people he knows.

sakky · August 25, 2011, 4:12pm

I never said that they all do it. Indeed, I have always pointed out that many (almost certainly most) do not.But the point is that they could do it, and nothing could realistically stop them. And some indeed do so.

But don’t take my word for it. Consider the words from Donald Hambrick, former President of the Academy of Management, in the article he wrote for the Journal of Management Inquiry in 2005. Those of you with access to the academic literature can read it yourself.

*…If tenure could be redecided 5 years after the initial
decision, I would estimate that about 20% to 25% of
professors at that point would be asked by their colleagues, not to mention by their deans, to pack their
bags. I’m not talking about the natural tendency for
scholars to decline in their productivity over a long
career. Rather, I’m talking about a small but significant
group of faculty who, once they get tenure, abruptly
behave in dysfunctional ways that weren’t foreseen
beforehand.

…Some simply stop working as hard on their academic
endeavors. …Once, a newly-tenured
colleague, steeped in the language of economics, told
me—without a hint of sheepishness—that he was now
going to do some “profit-taking.” He intended to
enjoy the fruits of his prior hard work by greatly
increasing his outside consulting and spending more
time on his hobbies. Within 3 years, he was seen as a
noncontributor, a bad joke, in his department and
school…*

Or consider this article from the Washington Post:

*… Her department, after all, is full of senior people who haven’t published anything in years, and who haven’t even bothered to master the new research techniques that have become possible since the collapse of the Soviet Union. Many of these people don’t do much teaching either, since the number of undergraduates majoring in Russian has dropped precipitously in the last decade. If they worked at a private company, some of them would be sacked and Karen would be promoted.

They have tenure, however, and Karen doesn’t. In theory, this means that they’ve proved their value to the university. In practice, it means they can’t be fired no matter how little they contribute as teachers or scholars. Karen is quick to add that some senior professors in her field have adapted to the post-Soviet world. But many have not. **“They’ve got tenure and they don’t have to learn,” **she says. Meanwhile, Karen will have to work harder than ever to produce another book in the next two years, which is likely to cut into the time she has for her students.

…Ask any faculty member for examples of “deadwood” and you’ll hear some hilarious stories about the abuses tenure invites–off the record, of course. One young philosophy profesor told me about two colleagues who had taken up dog-breeding and started a business as soon as they got tenure.

…When I asked one University of Massachusetts professor for examples of people who might have been fired if they hadn’t been tenured, he described a particle physicist who stopped doing particle research and started doing left-wing political organizing. “If he hadn’t had tenure, he might have been fired,” he told me ominously. Hmmm. Wasn’t he hired to do particle research?..*"

[The</a> Velvet Prison - teacher tenure offers little benefit to students in many cases - page 3 | Washington Monthly](<a href=“http://findarticles.com/p/articles/mi_m1316/is_5_31/ai_54644713/pg_3/?tag=mantle_skin;content]The”>http://findarticles.com/p/articles/mi_m1316/is_5_31/ai_54644713/pg_3/?tag=mantle_skin;content)

Or one could simply consider the intriguing proposal by Steven Leavitt of Freakonomics fame:

…what if one school chose to unilaterally revoke tenure. It seems to me that it might work out just fine for that school. It would have to pay the faculty a little extra to stay in a department without an insurance policy in the form of tenure. Importantly, though, the value of tenure is inversely related to how good you are. If you are way over the bar, you face almost no risk if tenure is abolished. So the really good people would require very small salary increases to compensate for no tenure, whereas the really bad, unproductive economists would need a much bigger subsidy to remain in a department with tenure gone. This works out fantastically well for the university because all the bad people end up leaving, the good people stay, and other good people from different institutions want to come to take advantage of the salary increase at the tenure-less school. If the U of C told me that they were going to revoke my tenure, but add $15,000 to my salary, I would be happy to take that trade. I’m sure many others would as well. By dumping one unproductive, previously tenured faculty member, the University could compensate ten others with the savings.

[Freakonomics</a> Let’s just get rid of tenure (including mine)](<a href=“Freakonomics - The hidden side of everything”>Let's Just Get Rid of Tenure (Including Mine) - Freakonomics)

But again, to reiterate, I never said that all tenured professors choose to take all of their summers off or otherwise do nothing. Indeed, I have always said that many of them continue to be productive. But one cannot deny that there is a conspicuous fraction who do not. As the Washington Post article said, practically everybody in academia can tell you about tragicomic stories about tenured ‘deadwood’ that they know.

More importantly, your entire attitude towards work along with your quality of life changes drastically when you realize that you don’t have to do it at all (or can do it poorly) yet still retain your job. The transition from untenured to tenured status therefore means shifting from doing research because you have to do it to doing it because you want to do it. It is for that reason that tenure is considered so precious by those who have it (and surely also why it is also so resented by those who don’t have it).

juillet · August 28, 2011, 7:00pm

Realistically speaking, the vast majority of professors do NOT have summers off and that should not be an expectation of anyone entering academia. Especially since earning tenure is really only the first step in remaining in a department - there’s promotion to full professor, there are pay raises, there’s recognition, etc. Most people enter academia because they want to do research, not because they expect some mythical 3-month vacation.

I look at it this way - as a graduate student I don’t even have a 3-month vacation during the summer. I do work. Why would I expect this to magically change when I get a job with even more responsibility? Yes, everyone has a story of a professor or two they know that kicks back after they obtain tenure and doesn’t do anything new. But the reason these are entertaining stories is because they are the exception to the rule. I am in an interdisciplinary program that straddles two departments and I don’t know a tenured professor in either department that has ceased doing research.

_Brahmin · August 29, 2011, 1:07pm

For people interested in the industry…isn’t stopping with a masters the best option?? because there aren’t many places where u would have gotten hired with a PhD but without a masters degree…right? And most people in the industry end up doing finance or business anyway? right?

And I know this next question may be hard to answer…isn’t someone who makes this transition to finance/business in the industry going to make more money than the people in academia who do make it “BIG”? or is that not really true?

tetrahedr0n · August 29, 2011, 4:05pm

Yes, because stopping with a master’s is the most cost-effective. Going on to do a PhD involves the cost of many years (usually five or more) with at best a very small boost in salary to make up for that. So it’s mostly a matter of opportunity cost.

This doesn’t make sense. The vast majority of PhD programs grant master’s degrees along the way, typically after you complete coursework and qualifying exams, and before the beginning of the dissertation. You will receive a masters one way or another, whether by doing a terminal masters degree or a PhD.

Not really. Of course some people end up doing finance of business. Lots don’t. The “industry” term includes all positions outside academia.

Finance and business positions have better financial compensation than almost all other positions, so this is likely. That said, it’s impossible to say what it means by making it “BIG” in academia.

It’s also very field-specific. Law, medicine, and business professors get paid very well. Engineering professors also get paid well. In theory, as a professor, you could create a startup and make any amount of money if you are successful. Some professors also consult on the side.

That said, I would guess that the vast majority of professors become professors because they are extremely passionate about their chosen academic discipline. Maximizing how much money they make was probably not their main goal.

sakky · August 30, 2011, 1:01pm

Actually, the contrary is true: with the exception of Deans and others with significant summer administrative responsibilities, not only can every tenured professor realistically have the summer off, they can 100% entirely expect to receive this. 100%.

The key nuance is that most choose not to take that option. They continue to perform research over the summer. But that is a voluntary choice that they make. They could also choose to take the entire summer off, and heck, essentially take the rest of their careers off. In a perfect world, tenure would be granted to only those professors who would choose to work hard after tenure. Unfortunately, we live in a world that is far from perfect.

And indeed, there are continuing promotions to full professors, pay raises, and increases in status to be gained after you’ve already obtained tenure by continuing to produce research. But many tenured professors don’t care about that. They’re perfectly content with doing the bare minimum for the rest of their careers once they’ve obtained tenure. Sad but true.

That’s why I continue to return to the Leavitt argument that perhaps universities should simply abolish tenure entirely in exchange for higher pay. The productive tenured faculty are unlikely to be terminated because of their productivity and will enjoy the increased salary, and even in the unlikely event that they are terminated, another university will surely hire them. The unproductive tenured faculty will be forced out of academia, as they should be. One crucial side-benefit for young scholars will be that there will surely be more faculty openings as the universities clear their deadwood.

Uh, tenure, that’s why.

Obviously, the transition to a graduate student to a tenure-track (but untenured) junior faculty won’t provide much of a respite. Indeed, the contrary is true - your workload will increase drastically as you will be expected to both teach and produce research. But that is because you are untenured. That is why many (almost certainly most) tenured faculty will candidly acknowledge that the most stressful years of their lives were their untenured junior faculty years.

Again, it is tenure that is the source of the magic. Once you have tenure, you never really have to do anything beyond the bare minimum. That’s both the beauty and the bane of tenure. Your quality of life changes dramatically once you receive tenure, which is why faculty are willing to work so hard to obtain it.

Now, again, I agree that many tenured faculty members continue to work hard and be productive. But there’s a clear difference in tone between working hard because you want to, and working hard because you have to for fear of being fired. Working hard on the topic of your choice - and knowing that you can take a breather anytime you want without fear of career repercussions - is something of a vacation in and of itself. But working hard on a topic - even if one that you enjoy - while knowing that you need to produce X number of pubs by a certain date or you will be fired, is clearly no vacation.

Thread		Replies	Views
Academia vs Industry Route (where is the $$$) Graduate School	18	128	April 14, 2021
opportunities in the industry with a PhD in the biological sciences Graduate School	7	58	April 14, 2021
Phd or masters in biomedical sciences Graduate School	5	195	April 14, 2021
job prospects for life science PhD (research track) Graduate School	6	73	April 14, 2021
Leaving Industry for Gradaute School Graduate School	3	44	April 14, 2021

Industry or Academia

Related topics