The base salary of the average engineering professional is currently $93,743 - up 7% over last year. However, bonuses were flat in 2007, and stock options fell 3%. Average total income in 2007 (base salary plus bonuses and all other sources of income) reached $102,748, compared to $96,320 in 2006. Although engineers had told us they expected their compensation packages to grow less than 3% this year, average income across the industry increased by 6.6%.
Now that paychecks are starting to look better, engineers may be wondering if there are better deals elsewhere. In fact, 42.2% believe their pay is less competitive than what they could be earning elsewhere, while 41.4% think it's probably just as good.
Engineers continue to keep their guard up as companies continue to outsource design work to cheaper labor markets overseas - and Congress continues to support the influx of lower-paid foreign workers.
"The future of high-tech engineering is a dead end here in the U.S.," said one survey respondent. "The engineers from Japan have run rings around the U.S. for years, and now we have to contend with China and India as engineering competitors. Once a foreigner takes control here in the U.S., he only hires people of his own race or nationality. I have watched this happen at an everincreasing rate."
As another engineer put it, "It is borderline immoral. As skills are shipped overseas, engineering careers becomes less rewarding and less attractive and less stable. The U.S. is slowly losing its technical edge. While CEOs are concerned about the next-quarter profits, the U.S. companies are slowly becoming more obsolete, and the technical high-paying job market is slowly eroding."
Corporate executives who typically take part in Electronic Design's reader surveys cover the gamut, from heads of large corporations to owners of small engineering startups and spinoffs. As you'd expect, incomes among this group depend more on bonuses and incentives. On average, tech executives pulled down $125,497 this year, or about 4% more than a year ago.
Engineers involved in design and development saw the biggest increase in their pay stubs this year, 9.8%, and now bring in $101,165 annually, compared to the $89,046 earned by engineers involved in other engineering functions like quality control, reliability, and test. Engineering managers as a group now average $124,709 in annual income.
This year, semiconductor houses once again led all industries in compensating engineers (averaging $129,985), followed by software firms ($121,890), computer manufacturers ($119,700), avionics companies ($108,788), and communications systems manufacturers ($108,514). In addition to doling out the highest salaries to designers, chip houses are also once again the most active in looking for new engineering talent.
As in the past, engineers working at U.S. contract manufacturing firms bring up the rear in OEM salaries, as domestic electronic manufacturing services (EMS) firms continue to help clients cut costs by keeping their own engineering costs low. The average compensation paid to these workers dipped slightly, from $92,147 in 2006 to $89,048 in 2007. The good news is that traditional design houses in the U.S. say they are looking to outsource more work to domestic contract manufacturing firms - 64.3% versus 59.8% a year ago.
Another sign of the healthy state of the industry is that almost half of our readers surveyed this year said that a headhunter or recruiter had contacted them at some point during the past 12 months. Given the strength of the engineering economy and the current low unemployment rate, it was surprising to find that only 35% of survey respondents said they believe their company is more focused on employee retention this year - down from about 40% a year ago.
"During the past 20 to 25 years, I have witnessed the status of an engineer go from a respected, valued, well-compensated, core member of society to that of a commodity or an overhead expense that should be used for a specific purpose and then disposed of," said an engineer. "Most engineering jobs now are with consulting firms that bid on specific, short-duration jobs, which by nature utilize engineering skills as a commodity with no long-term obligations. Other professions, such as doctors, lawyers, and CPAs, seem to have been able to maintain their longterm viability and respect within society."
While the "lucky to have a job" mentality of a few years back may have faded, most engineers still feel somewhat insecure - and they may be justified in their feelings. As one reader stated: "Pressure on engineers has increased, and managers with no technical background receive much more recognition than hardworking engineers. When the job is well done, the managers receive recognition, but when there is a problem it is always the engineers who will be blamed for it."
Two factors that are inextricably linked to higher wages are company size and geographic region. As we've seen in past surveys, larger companies tend to dish out bigger salaries, bonuses, and raises. They're also more generous when it comes to noncash rewards and benefits such as stock options, 401(k) plans, pensions, patent awards, continuing education opportunities, and health coverage.
On average, however, engineers at smaller companies feel more secure in their jobs, and they're more satisfied with their current paychecks - so bigger isn't necessarily better for everyone (see "Small Firms Pay Less Money - But It May Be Worth It," p. 26).
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