A short answer to the question I get most often.
Whenever I tell people I am an economist, the most common reply I get is: "what does an economist do?" I had always assumed most people have a vague idea of what an economist does, but it seems that's not the case.
Economics is a broad discipline, and economists do a vast range of things, from advancing economic thinking through research, to uncovering patterns in data that inform policymakers. But one thing all economists have in common is this: they use data to inform decisions, or to test assumptions about how the various components of the economy actually work.
As an economist working at the Ministry of Finance, my primary roles involve:
Suppose the government wants to raise the tax rate on cigarettes to bring in more revenue. It cannot arbitrarily raise the rate without first examining how consumers would respond.
A higher tax rate makes cigarettes more expensive, so the government collects more revenue per pack sold. At the same time, because cigarettes are now less affordable, people will cut down on their consumption, which has a downward impact on revenue.
So there are two countervailing forces pulling revenue in opposite directions. My job as an economist is to identify the tax rate at which the positive force outweighs the negative one, in other words, the rate that actually increases revenue.
I would do so by examining past rate increases to estimate how sensitive consumers are to price changes (what economists call elasticity). I would then use that estimate, combined with current consumption levels, to project revenue under different tax rates and identify the one that maximises it.