Product development MEs, EEs bask in sunshine

DN Staff

July 14, 2004

6 Min Read
Product development MEs, EEs bask in sunshine

The job outlook for mechanical and electrical engineers with at least 10 years of experience "may actually be improving significantly," according to Ben Liebstein, managing director of the recruiting firm Bennett Allen & Associates. Though hit hard in previous downturns, Liebstein says MEs and EEs-especially those who specialize in product development-are finally seeing a placement rebound. While he can't pinpoint specific industries ("The jobs are really all over"), Liebstein says the demand for product design engineers exceeds the supply. Liebstein's firm has seen a 40% surge in ME and EE recruitment in 2004 compared with the same period last year.

Companies that previously reduced their workforce and lost their most knowledgeable staffs are now actively seeking senior-level engineers. And some of those companies "may have compensated those remaining in the company better than in years past," Liebstein notes.

Increased hiring and pay raises for senior engineers help account for the direct correlation between experience and mean salary that was evident in Design News' most recent Salary Survey results.

Manufacturing continues to be underdog, however, with U.S. engineering jobs disappearing due to offshore outsourcing.

Releasing its first outsourcing study in June, the U.S. Bureau of Labor Statistics says offshore and domestic outsourcing respectively accounted for 1.9% and 4.2% of the 239,000 layoffs from January to March 2004.

Although the report does not pinpoint the impact on engineers, the Design News survey makes it clear that engineers are generally concerned about outsourcing: "Not losing the job to India," is one engineer's most difficult current job challenge. "Outsourcing to low-cost countries," frets another respondent.

Design News' salary survey also found that more engineers are seeing their work being relocated to both U.S. and overseas offices. Among the design work being outsourced is mechanical design (45.3%), CAD (26.3%), test and measurement (26.3%), circuit design (22.3%), board-level design (21.8%), and systems design (19.6%).

Survey forms were sent to work addresses and completed by those who still held jobs, thus it was unclear just how many engineers in the U.S. have actually lost jobs to others overseas. But anecdotal evidence suggests that the specter of job loss looms large.

With outsourced manufacturing the notable exception, "The technology market has stabilized and salaries are beginning to recover overall," adds Scot Melland, president and CEO of Dice Inc., the online job board for technology and engineering professionals. "Some segments are doing especially well; average salaries for women, for example, have recovered faster as evidenced by the narrowing of the gender gap. Entry level technology professionals are also earning more money, which is consistent with an economic turnaround."

Demand for new hires is especially high in the aerospace industry, according to the Design News survey results. Lockheed Martin Corp., for example, plans to hire 14,000 recent graduates this year, and Boeing is offering starting salaries of $55,000 to $60,000 to entry-level engineers with a Bachelor's of Science degree. That's a step beyond the $47,300 average the Design News survey found last year. Industry-wide, aerospace companies are loosening the purse strings for engineers, paying $80,200 compared to annual salaries of $75,999 reported by 56 percent of survey respondents.

Boeing currently needs some 6,000 engineers conversant in such disciplines as embedded software, laser and electro, optical, imaging, stress structural, thermal design, control system, avionic system, radar system, payload system, and electronic warfare, according to Barbara Murphy of the company's communications and public relations office.

Murphy says Boeing isn't able to fill those positions as quickly as it would like, in part because most require a security clearance from the Department of Defense, and it's taking up to 18 months to process the clearances. To take up the slack, Boeing is looking for candidates who already have DoD clearance from previous assignments elsewhere.

"The challenge for Boeing and also for other aerospace companies is to increase the size of the pool," says Murphy.

In its own salary survey, Dice gathered information from more than 21,000 visitors to its site. Among its findings: The gender gap narrowed for the first time since 2000. Echoing Design News' survey, Dice recorded a recovery of salaries among those hit hardest last year, and significant salary growth for entry-level technology workers.

Overall, tech salaries recovered this year to the highest level since 2000, with the average salary increasing 2% from $67,900 in 2002 to $69,400 in 2003, according to the Dice survey. For the second year in a row, government and defense salaries showed the largest gains, increasing $2,600 (4%) to $64,600. Salaries in the computer hardware industry, one of the hardest hit industries in the downturn, also increased by 4% to $57,900.

The Dice results also show that the gender gap -- salary differential between men and women -- narrowed to 11%, with women's salaries increasing by 5% to $62,800 and men's salaries gaining by just 2%. The gap varied significantly by industry, with women's salaries just 3% lower than men's in the Internet services industry but 19% less in the medical and pharmaceutical fields. Women over 50 had the largest gap, earning 13.5% less than their male counterparts.

Following the money

Network and MIS manager positions had the largest increases over the past year, gaining 7% and 5% respectively, Dice results show. The highest paying titles were the same as last year: IT management topped the list at $104,000, with project management following at $88,300. Systems developer ($83,200) and software engineer ($81,400) were the top paying non-management titles.

Top paying skills include proficiency with SAP and Peoplesoft software. Full-time workers experienced in using those products reported earning $81,200 and $78,600, respectively. Full-time tech workers with experience in Unix and C/C++, the two skills most requested by employers on the Dice site, reported earning $75,200 and $72,400, respectively.

Earning power tended to increase with age until age 50, after which salaries declined about 2% to $78,800. After holding steady from 2001 to 2002, workers over 50 witnessed a salary decline of 4% ($3,500) in 2003. Entry-level workers (with less than two years of technology experience) saw their salaries increase 3% from 2002.

Go to the following websites for more info:

2004 Design News annual salary survey results:

2003 Design News annual salary survey results:

2004 Design News annual salary survey pdf file:

Dice Inc. annual salary survey results:

Dice Engineering job board:

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