Tuesday, February 19, 2013

Why Engineers Earn More

Year after year, engineers are ranked among the highest-paid professionals in the U.S., both in terms of starting salary and mid-career income. In honor of National Engineers Week (Feb. 17-23), we look at the reasons why engineers command top-tier compensation, and what recent graduates, as well as experienced engineers, can expect to earn.

Good news for those about to graduate with engineering degrees: Your education is going to pay off more than most other majors, despite the fact that the cost of college tuition continues to rise faster than many families can keep up with. Multiple sources report that careers in engineering pay well above the national average, and become increasingly lucrative as experience builds over time.
The median yearly pay for recent college graduates with full-time jobs was $53,976 in 2010, according to Fortune. While this is 20 percent higher than the national average of $45,230, as calculated by the Bureau of Labor Statistics (BLS), many of these young men and women are coming out of school with six-figure debts hanging over them.
But those in engineering roles can expect to have an average salary of $77,120, more than 71 percent higher than the national average. Of the 15 majors that command the highest compensation for recent grads, 10 are engineering degrees, including mechanical engineering technology ($63,000) and electrical and electronics engineering technology ($65,000).
Why do engineers earn more than most other professions? The answer is that they’re in extremely high demand. Although national unemployment is close to 8 percent, many employers are reporting that they can’t hire engineers fast enough to fill open positions.
A ManpowerGroup study revealed that engineer is the second-most difficult position to fill nationwide. An estimated 49 percent of U.S. engineering firms struggle to find applicants for the available jobs. The reason, according to 36 percent of respondents, is a shortage of qualified applicants in the geographic region.
Even when hiring was at its worst in 2009, engineering occupations fared better than most. U.S. News and World Report found that unemployment among engineers peaked at 6.4 percent in 2009, and dropped to around 2 percent in mid-2011. For some engineering professions, prospects are even brighter. The Association of Information Technology Professionals (AITP) calculated the unemployment rate for aerospace engineers was 1 percent in the third quarter of 2012. For petroleum engineers during the same period, the jobless rate was 0.4 percent.
The hiring push is likely to continue for the foreseeable future, further driving up engineering salaries. Electronic Design’s Engineering Salary Survey 2012 found that 30 percent of engineering companies are planning to increase their payrolls.
The long-term earning potential for engineers is among the strongest in the U.S. job market, with engineering roles filling 12 of the top 20 highest-earning slots in the 2013 PayScale Salary Survey. Topping the list was petroleum engineering, which had a mid-career salary potential of $163,000. A petroleum engineering degree also commands the highest entry-level salary at $98,000.
Ranked by starting salary, the top-paying engineering fields are:
  • Petroleum Engineering – $98,000
  • Chemical Engineering – $67,500
  • Nuclear Engineering – $66,800
  • Electrical Engineering – $63,400
  • Computer Engineering – $62,700
  • Aerospace Engineering – $62,500
  • Materials Sciences & Engineering – $60,100
  • Mechanical Engineering – $60,100
  • Industrial Engineering – $59,900
  • Software Engineering – $59,100
  • Electrical Engineering Technology – $58,400
  • Computer Science – $58,400
  • Biomedical Engineering – $54,900
  • Civil Engineering – $53,800
  • Mechanical Engineering Technology  – $52,900
  • Civil Engineering Technology – $49,500
  • Environmental Engineering – $47,900
According to a joint survey from the American Society of Civil Engineers (ASCE) and American Society of Mechanical Engineers (ASME), in 2010 the average annual engineering income was $100,603. By 2012, that figure had risen to $108,558, a 7.9 percent increase over two years.
Not only is an engineering degree a worthwhile investment, but individuals with higher degrees carry greater earning power. For example, Manpower notes that the median salary for bachelor’s degree-holders is $85,900, with a range of $55,000 to $148,000. Those with a master’s degree have a median salary of $95,575 with a range of $60,500 to $161,000. Combining an MBA with a master’s lifts the median salary to $125,000.
Unfortunately, there’s also a troubling gender divide in the profession. Female engineers’ salaries average $17,000 less than men in the same roles, according to Electronic Design. Not only that, but women are very much a minority among engineers. A report by UBM Electronics states that only 8 percent of engineers are women.
Once they’re out of school and working, one of the biggest challenges engineers face is keeping up with current technology. Yet there has been a sharp decrease over the years in company compensation for continuing education, including college courses, seminars, and conferences.
UBM finds that 88 percent of engineers feel they are personally responsible for updating their knowledge and skills. As a result, many are turning to free resources, such as white papers, webinars, online magazines, and blogs, to enhance their knowledge base. Among experienced engineers, 83 percent rely on vendors for technical assistance and new technology information. Other top resources include industry e-newsletters, online tutorials, and internet communities and forums.

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