Tables of Contents
- What Is an Analyst?
- 5 Different Types of Analyst Jobs
Data is integrated into all corners of the global marketplace, driving economic growth and helping businesses compete. Sales strategies that incorporate a data-driven approach can see increases of 15% to 25% of earnings before interest, taxes, depreciation, and amortization (EBITDA), according to McKinsey & Company.
One can argue that a company with many customers, and subsequently lots of data, has a natural advantage over a company with less data. However, more data does not necessarily translate into a competitive advantage unless decision-makers know how to analyze and use that data.
Here is where the role of an analyst comes into play. What is an analyst? Analysts conduct research and analyze publicly available or privately collected data to find patterns, trends, and insights that can help in decision-making and planning.
Whether an economic analyst, a data analyst, a financial analyst, an operations analyst, or a business analyst, an individual in this role is crucial in extracting value from information. Common analyst activities include:
- Gathering, preparing, and interpreting data
- Finding patterns and trends in data
- Producing reports summarizing data findings to help with business decision-making
Through analysis — the process of breaking information into smaller components to draw conclusions based on the findings — analysts help organizations transform data into business benefits. For example, an analyst can work with data to help businesses save on costs, improve operations, and develop a product pricing strategy that meets market demands.
What Is an Analyst?
In defining what an analyst is, describing the role’s primary activities is important, including:
- Gathering data. The process of gathering data can include collecting information from various internal and external sources. Internal data sources can range from customer buying behavior to crucial information about business operations. The activities used to gather data and prepare it for analysis include conducting interviews and surveys, reviewing marketing analytics data, and documenting observations and records.
- Analyzing data. Not all data is ready to be used, so cleaning and structuring it before analysis is essential. Another critical step includes data mining, which involves techniques to uncover hidden patterns or anomalies. The two primary forms of analysis are quantitative and qualitative. Quantitative data analysis requires working with numerical data, whereas qualitative data analysis involves working with descriptive data. Other forms include statistical, predictive, and prescriptive analysis.
- Drawing conclusions. Once data is gathered and analyzed, it must be interpreted. This means finding patterns and trends and drawing conclusions about what the data reveals. Then, analysts help managers and leaders understand the data, so they can make right decisions.
5 Different Types of Analyst Jobs
Practically every industry has analyst roles — collecting and analyzing data and leveraging business, communication, and problem-solving skills to make informed decisions. Depending on the industry, they focus on different areas. For example, an analyst in a government agency may focus on data that helps determine the impact of a regulation or a policy, whereas an analyst in the technology sector may focus on data that reveals system performance.
Analysts typically work in office settings, though some, such as operations analysts, conduct field research and travel to meet with clients to gather and analyze data.
Different types of analyst jobs include the following:
1. Economic Analyst
Economic analysts research and analyze data and trends in commerce, the financial markets, and state and federal governments. They study data to present information on the current state of the economy and forecast short- and long-term scenarios.
In the government, an economic analyst may evaluate data related to the labor market or taxation to help leaders make decisions that can improve the lives of everyday citizens and help increase revenue for essential government programs. Economic analysts typically translate the data and present it in readable formats such as reports and charts.
The U.S. Bureau of Labor Statistics (BLS) does not provide data for economic analysts, but it does project that a similar role, economist, is expected to grow by 13% between 2020 and 2030.
Typical economic analyst job duties include the following:
- Researching economic trends
- Developing economic forecasts and models
- Providing reports
Educational requirements for the role vary. For entry-level positions, at least a bachelor’s degree is required, though for senior roles, employers prefer candidates with a master’s degree in business, finance, or accounting. Required skills include the quantitative and mathematics competencies to gather and analyze data, perform advanced calculations, and work with statistical data and models.
Economic analysts should have strong technical skills because they work with various data analysis tools. They also should have critical thinking skills to solve complex problems, and communication and writing skills to present their findings to decision-makers via presentations and reports.
Economic Analyst Salary
The median annual salary for economic analysts was about $62,000 as of January 2022, according to PayScale, with the highest 10% making more than $97,000.
2. Data Analyst
Data analysts analyze and interpret a wide range of data to enable leaders to make decisions that can lead to better business and operational performance, increased sales, and cost savings.
Typical data analyst job duties vary based on industry, but common responsibilities include the following:
- Conducting statistical tests
- Translating large amounts of data
- Identifying important trends
The BLS does not provide information on data analysts, but a similar role, computer and information research scientist, is expected to grow by 22% between 2020 and 2030.
Educational requirements for the role vary, but employers typically prefer candidates who have a master’s degree with a focus in computer science, computer engineering, or data science. A data analyst is expected to have strong quantitative and mathematics skills and the technical skills to use various tools for data analytics, predictive analytics, and data visualization.
In pursuing a data analyst career path, acquiring strong organizational skills to help keep data projects in order is also important. As with all analyst roles, problem-solving skills are essential for data analysts to view problems from multiple angles and uncover creative solutions.
Data Analyst Salary
The median annual salary for data analysts was $63,000 as of March 2022, according to PayScale, with the highest 10% making more than $87,000.
3. Financial Analyst
Financial analysts help ensure organizations’ strong financial standing. According to the BLS, the positions for financial analysts are expected to grow by 6% between 2020 and 2030.
By examining financial data and providing actionable information, financial analysts help ensure business continuity by promoting profitability and liquidity. The different types of financial analysts include investment analysts, who evaluate an organization’s investment strategy, and securities analysts, who follow securities markets and trends. Common activities in financial analyst roles include:
- Gathering and evaluating financial and business data
- Making recommendations on spending, budgeting, and investing
- Preparing financial reports
- Supporting management decision-making about business and investments
Employers often hire individuals with bachelor’s degrees in finance or business administration, though those with certification such as Chartered Financial Analyst (CFA) from the CFA Institute are highly desired. A combination of several years’ experience and a bachelor’s degree is required to qualify to take the CFA exam. Financial analysts with a master’s degree in data science are also in demand.
Financial analysts should have strong quantitative and financial skills, as working with numbers is core to the role. Technical skills enable financial analysts to work with various tools to perform calculations and develop financial models. Other useful competencies include attention to detail and communication and decision-making skills.
Financial Analyst Salary
The median annual salary for financial analysts was $83,660 as of May 2020, according to the BLS. Pay may vary by industry. For example, financial analysts working in securities, commodity contracts, and other financial investments made a median annual salary of $98,850, while those working in credit intermediation and related activities earned $79,270.
4. Operations Analyst
Operations analysts are key to organizations seeking to increase efficiency and improve operational performance. According to the BLS, the operations research analyst role, which includes operations analysts, is expected to grow by 25% between 2020 and 2030.
By evaluating problems using analytical methods and providing actionable information that can help improve operational performance, operations analysts help organizations with problem-solving, decision-making, and growth. Problems are often too complex to solve with a single approach, so operations analysts monitor the impact of different changes and weigh the costs of alternate solutions. Operations analysts perform a wide range of activities, including:
- Analyzing risk
- Recommending business process improvements
- Forecasting outcomes
Employers often hire individuals with bachelor’s degrees for operations analyst roles, though some may prefer individuals with master’s degrees. Common areas of study include business, social science, analytics, and engineering. Operations analysts use quantitative and technical skills to work with various analytical tools that help them assess current operational performance and determine areas for improvement. Other useful competencies for operations analysts include problem-solving and collaborating with colleagues.
Operations Analyst Salary
Operations analysts, which the BLS categorizes as operations research analysts, earned a median annual salary of $86,200 as of May 2020. Operations research analysts working in the federal government earned a median annual salary of $119,720, whereas those working in professional, scientific, and technical services earned a median annual salary of $85,950.
5. Business Analyst
Business analysts help organizations that are trying to solve business problems and improve efficiency. According to the BLS, the management analyst role, which includes business analysts, is expected to grow by 14% between 2020 and 2030.
By gathering information through data methods such as interviews, business analysts identify areas for improvement and determine solutions. Business analysts may specialize in certain areas (logistics, supply chain) or industries (healthcare, technology). Common business analyst activities include:
- Identifying the information technology (IT) and business needs of an organization
- Implementing programs focused on improving business efficiency
- Creating reports for executives and decision-makers
- Recommending new systems or changes in organizational processes
Individuals with bachelor’s degrees in business, social science, or engineering and several years of experience are ideal candidates for business analyst roles, though some employers may prefer individuals with a Master of Business Administration (MBA) for senior roles. Business analysts rely on project management skills and quantitative and technical skills to identify areas of high and low performance. Other useful competencies include communication and team-building skills.
Business Analyst Salary
Business analysts, which the BLS categorizes as management analysts, earned a median annual salary of $87,660 as of May 2020. Management analysts working in professional, scientific, and technical services earned the most, with a median annual salary of $93,710. Those working in finance/insurance and government sectors earned $86,690 and $83,500, respectively.
Pursue a Career as an Analyst
Data has a significant impact on global markets and plays a crucial role in increasing economic activity. Technology and analytical tools continue to improve how data is collected, shared, stored, and analyzed, playing a key role in what an analyst is. Analysts across industries and functions need to be equipped with the skills and knowledge to help organizations act upon data and achieve improvements.