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Source: General Services Administration
Federal, State, and local governments employ 1 out of 3 budget analysts.
A bachelor's degree generally is the minimum educational requirement; however,
some employers require a master's degree.
Competition for jobs should remain keen because of the substantial number of
qualified applicants; those with a master's degree should enjoy the best job
Nature of the Work
Budget analysts play a primary role in the development, analysis, and
execution of budgets. Budgets are financial plans used to estimate future
requirements and organize and allocate operating and capital resources
effectively. The analysis of spending behavior and the planning of future
operations are an integral part of the decision-making process in most
corporations and government agencies.
Budget analysts work in private industry, nonprofit organizations, and the
public sector. In private industry, a budget analyst examines, analyzes, and
seeks new ways to improve efficiency and increase profits. Although analysts
working in government generally are not concerned with profits, they too are
interested in finding the most efficient distribution of funds and other
resources among various departments and programs.
A major responsibility of budget analysts is to provide advice and technical
assistance in the preparation of annual budgets. At the beginning of the
budget cycle, managers and department heads submit proposed operating and
financial plans to budget analysts for review. These plans outline expected
programs, including proposed program increases and new initiatives; estimated
costs and expenses; and capital expenditures needed to finance these programs.
Analysts begin by examining the budget estimates or proposals for
completeness, accuracy, and conformance with established procedures,
regulations, and organizational objectives. Sometimes they review financial
requests by employing cost-benefit analysis, assessing program trade-offs, and
exploring alternative funding methods. They also examine past and current
budgets, and research economic and financial developments that affect the
organization's spending. This process allows analysts to evaluate proposals in
terms of the organization's priorities and financial resources.
After this review process, budget analysts consolidate the individual
department budgets into operating and capital budget summaries. The analysts
submit preliminary budgets to senior management, or sometimes, as is often the
case in local and State governments, to appointed or elected officials, with
comments and supporting statements that justify or deny funding requests. By
reviewing different departments' operating plans, analysts gain insight into
an organization's overall operations. This generally proves useful when they
interpret and offer technical assistance to officials approving the budget. At
this point in the budget process, budget analysts help the chief operating
officer, agency head, or other top managers analyze the proposed plan and
devise possible alternatives if the projected results are unsatisfactory. The
final decision to approve the budget, however, is usually made by the
organization head in a private firm or elected officials in government, such
as the State legislative body.
Throughout the rest of the year, analysts periodically monitor the budget by
reviewing reports and accounting records to determine if allocated funds have
been spent as specified. If deviations appear between the approved budget and
actual performance, budget analysts may write a report explaining the causes
of the variations along with recommendations for new or revised budget
procedures. They suggest reallocation of excess funds or recommend program
cuts to avoid or alleviate deficits. They also inform program managers and
others within their organization of the status and availability of funds in
different budget accounts. Before any changes are made to an existing program
or a new one is started, a budget analyst assesses its efficiency and
effectiveness. Analysts also may project budget needs for long-range planning.
The budget analyst's role has broadened as limited funding has led to
downsizing and restructuring throughout private industry and government. In
addition to developing guidelines and policies governing the formulation and
maintenance of the budget, analysts may measure organizational performance,
assessing the effect of various programs and policies on the budget, and help
draft budget-related legislation. Budget analysts sometimes conduct training
sessions for company or government agency personnel on new budget procedures.
Budget analysts work in a normal office setting, generally 40 hours per
week. However, during the initial development and mid-year and final reviews
of budgets, they often experience the pressure of deadlines and tight work
schedules. The work during these periods can be extremely stressful, and
analysts are usually required to work more than the routine 40 hours a week.
Budget analysts spend the majority of their time working independently,
compiling and analyzing data and preparing budget proposals. Nevertheless,
their routine schedule can be interrupted by special budget requests,
meetings, and training sessions. Others may travel to obtain budget details
and explanations of various programs from coworkers, and to personally observe
what funding is being used for in the field.
Budget analysts held about 66,000 jobs throughout private industry and
government in 1996. Federal, State, and local governments are major employers,
accounting for one-third of budget analyst jobs. The Department of Defense
employed 7 of every 10 budget analysts working for the Federal Government.
Other major employers of budget analysts are schools, hospitals, banks; and
manufacturers of transportation equipment, chemicals and allied products,
electrical and electronic machinery, and industrial machines.
Private firms and government agencies generally require candidates for
budget analyst positions to have at least a bachelor's degree. Within the
Federal Government, a bachelor's degree in any field is sufficient background
for an entry-level budget analyst position. State and local governments have
varying requirements, but a bachelor's degree in one of many
areas—accounting, finance, business or public administration, economics,
political science, planning, statistics, or a social science such as
sociology—may qualify one for entry into the occupation. Sometimes, a field
closely related to the employing industry or organization within an industry,
such as engineering, may be preferred. An increasing number of States and
other employers require a candidate to possess a master's degree to ensure
adequate analytical and communication skills. Some firms prefer candidates
with business backgrounds because business courses emphasize quantitative
analytical skills. Budget and financial experience can occasionally be
substituted for formal education when applying for a budget analyst position.
Because developing a budget involves manipulating numbers and requires strong
analytical skills, courses in statistics or accounting are helpful, regardless
of the prospective budget analyst's major field of study. Financial analysis
in most organizations is automated, and requires familiarity with word
processing and the financial software packages used in budget analysis.
Software packages commonly used by budget analysts include electronic
spreadsheets and database and graphics software. Employers generally prefer
job candidates who already possess these computer skills over those who need
to be trained.
In addition to analytical and computer skills, those seeking a career as a
budget analyst must also be able to work under strict time constraints. Strong
oral and written communication skills are essential for analysts to prepare,
present, and defend budget proposals to decision makers.
Entry-level budget analysts may receive some formal training when they begin
their jobs. However, most employers feel that the best training is obtained by
working through one complete budget cycle. During the cycle, analysts become
familiar with all the steps involved in the budgeting process.
The Federal Government, on the other hand, offers extensive on-the-job and
classroom training for entry-level analysts, who are initially called
trainees. Analysts are encouraged to participate in the various classes
offered throughout their careers.
Beginning analysts usually work under close supervision. Capable entry-level
analysts can be promoted into intermediate level positions within 1 to 2
years, and then into senior positions within a few more years. Progressing to
a higher level means added budgetary responsibility and can lead to a
In the Federal Government, for example, beginning budget analysts compare
projected costs with prior expenditures; consolidate and enter data prepared
by others; and assist higher grade analysts by doing research. As analysts
progress, they begin to develop and formulate budget estimates and
justification statements; perform in-depth analyses of budget requests; write
statements supporting funding requests; advise program managers and others on
the status and availability of funds in different budget activities; and
present and defend budget proposals to senior managers.
Because of the importance and high visibility of their jobs, senior budget
analysts are prime candidates for promotion to management positions in various
parts of the organization.
Despite the increase in demand for budget analysts, competition for jobs
should remain keen because of the substantial number of qualified applicants.
Job opportunities are generally best for candidates with a master's degree. In
some cases, budget and financial experience can offset a lack of formal
education. A working knowledge of computer financial software packages can
also enhance one's employment prospects in this field.
Employment of budget analysts is expected to grow about as fast as the average
for all occupations through the year 2006. In addition to employment growth,
many job openings will result from the need to replace experienced budget
analysts who transfer to other occupations or leave the labor force.
Planning and financial control demand more attention because of the growing
complexity of business and the increasing specialization within organizations.
Many companies will continue to rely heavily on budget analysts to examine,
analyze, and develop budgets to determine capital requirements and to allocate
labor and other resources efficiently among all parts of the organization.
Managers will continue to use budgets as a vehicle to plan, coordinate,
control, and evaluate activities within their organizations more effectively.
Expanding automation continues to make budget analysts more productive,
allowing them to process more data in less time. Also, computers are
increasingly used to organize, summarize, and disseminate data to top-level
managers, thereby centralizing decision-making and reducing the need for
middle managers in many organizations. However, any computer-induced effects
on employment of budget analysts may be offset by growing demand for
information and analysis. Easier manipulation of and accessibility to data
provide management with more considerations on which to base decisions.
The financial work performed by budget analysts is an important function in
every organization. Financial and budget reports must be completed during
periods of economic growth and slowdowns. Therefore, budget analysts generally
are less subject to layoffs during economic downturns than many other workers.
Salaries of budget analysts vary widely by experience, education, and
employer. According to a survey conducted by Robert Half International, a
staffing services firm specializing in accounting and finance, starting
salaries of budget and other financial analysts in small firms ranged from
$24,000 to $33,200 in 1997; in large organizations, from $28,000 to $38,700.
In small firms, analysts with 1 to 3 years of experience earned from $28,000
to $43,100; in large companies, from $31,000 to $51,300. Senior analysts in
small firms earned from $34,500 to $50,000; in large firms, from $39,000 to
$60,600. Earnings of managers in this field ranged from $40,000 to $65,000 a
year in small firms, while managers in large organizations earned between
$47,000 and $83,800.
A survey of workplaces in 160 metropolitan areas reported that inexperienced
budget analysts had median annual earnings of about $30,100 in 1995, with the
middle half earning between $26,200 and $35,500 a year.
In the Federal Government, budget analysts generally started as trainees
earning $19,500 or $24,200 a year in 1997. Candidates with a master's degree
might begin at $29,600. Beginning salaries were slightly higher in selected
areas where the prevailing local pay level was higher. The average annual
salary for budget analysts employed by the Federal Government in
nonsupervisory, supervisory, and managerial positions was $48,600 in 1997.
Budget analysts review, analyze, and interpret financial data; make
recommendations for the future; and assist in the implementation of new ideas.
Workers who use these skills in other occupations include accountants and
auditors, economists, financial analysts, financial managers, and loan
Information about career opportunities as a budget analyst may be available
from your State or local employment service.
Information on acquiring a job as a budget analyst with the Federal Government
may be obtained from the Office of Personnel Management through a
telephone-based system. Consult your telephone directory under U.S. Government
for a local number, or call (912) 757-3000 (TDD 912 744-2299). That number is
not toll-free and charges may result.
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