Although not a requirement to become a risk manager, a master's degree can be highly beneficial for entry and advancement in this field. Relevant work experience in the financial industry can also be advantageous when pursuing a career as a risk manager.
Risk analysts, sometimes referred to as risk managers, help businesses determine the amount of financial risks involved concerning investments and operational costs. Many risk analysts work for financial institutions, such as banks and investment firms. Some professionals also work as consultants and go from business to business assessing potential risk factors. Other risk analysts work in corporate accounting offices and focus on identifying risk factors at multiple store locations.
To find employment, risk analysts often require the minimum of a bachelor's degree and around five years of work experience in the financial industry. Candidates who hold graduate degrees may fare better in the job market. Certification remains voluntary for this industry, but some employers may favor certified analysts.
|Required Education||Bachelor's degree or higher|
|Other Requirements||At least five years related work experience|
|Median Salary (2018)||$127,990 (for all financial managers)*|
|Projected Job Growth (2018-2028)||16% growth (for all financial managers)*|
Source: *U.S. Bureau of Labor Statistics
The U.S. Bureau of Labor Statistics (BLS) states that risk analysts review all potential risk factors involved in running a business. Such risk factors may include problems with the physical location of the organization, potential for robberies, and the likelihood of employees being injured on the job. After reviewing these factors, analysts make suggestions on how to safeguard an organization against risks, such as purchasing additional insurance plans or implementing employee safety protocols.
The majority of risk analysts work in offices as they examine statistical reports and other documents. Sometimes analysts must go into the field to gather data, which could involve walking through businesses, talking with employees, and taking accurate measurements of the work environment. Analysts may also travel to libraries or government records offices to pull up additional information needed for determining risk factors.
Information from the BLS shows that employers prefer applicants with at least a bachelor's degree related to finance; however, recent hiring trends indicate that many employers prefer applicants who hold graduate degrees. Master's degree programs in risk management offer such coursework as investment planning, market risk management, credit risk management, investment statistics, and probability. Graduate level certificate programs in financial risk management are also available and include courses, such as hedging and derivatives, asset securities, and quantitative risk management.
In the decade between 2018 and 2028, the BLS predicted that open positions for all financial managers, which include risk analysts, would grow by seven percent. These open positions were expected to grow due to the increase in businesses causing the need for more financial managers. As the economy goes up and down, risk analysts may find more temporary positions available, especially with consultation agencies. Temporary positions are expected to grow, since not all businesses require the services of a full-time risk analyst.
Currently, the BLS does not have salary statistics specifically for risk analysts. Since risk analysts are considered a specialty field under the category of financial managers, salary statistics for financial managers provide comparable information. As of May 2018, the BLS listed that financial managers in all industries earned a median annual salary of $127,990. Records from that same year indicated that the financial managers who earned the highest average annual salaries worked in the following states: New York, New Jersey, Delaware, Connecticut, and the District of Columbia.
Risk analysis is generally considered a specialty field, so understanding the necessary educational background and work experience required for success is a good first step when considering this career.