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How much is an engineer worth?

As always happens when yet another report emerges warning of a UK engineering skills shortage, the initial response from vocal readers of The Engineer has been to decry the level of pay that engineers receive in this country.

As one reader pointed out, the 15 per cent wage premium mentioned in the report for those who’ve studied for years to gain an engineering qualification doesn’t seem a lot. However, it’s not the whole picture, so I thought I’d draw out some extra points from the Royal Academy of Engineering-commisioned study.

According to the Office for National Statistics’ Labour Force Survey of 163,218 people aged 16–64 in England & Wales between 2004 and 2010, looking at those who had STEM qualifications and those who worked in SET jobs, there was:

  • a 19% wage premium for STEM overall;
  • a 10% premium for science occupations;
  • a 33% premium for technology occupations;
  • a 15% premium for engineering occupations;
  • but hybrid science/engineering occupations do not attract a premium.

This implies that if you work in an engineering job you are likely to earn an average of 15 per cent more than the average person in the UK (but not 15 per cent more than minimum wage, as one reader suggested).

The Labour Force Survey for the first quarter of 2011 found median wage for engineering professionals to be £29,700. The ONS median full time salary in the UK in 2011 was £26,244 – which makes that 15 per cent figure look about right.

These engineering jobs will include technicians and medium-skilled workers. However, if we look at engineering graduate salaries and compare them to those of people with only two A Levels, we see a bigger premium.

Data from the Department of Business, Innovation and Skills (BIS) showed that an engineering graduate in 2009 was likely to earn 32 per cent more than someone with two A Levels. This was also higher than the average graduate premium, which was only 27 per cent above the salary of A Level holders.

The Academy’s report also found that engineers’ salaries rose sharply as they got older, suggesting employers put an even bigger premium on experience than they do on qualifications.

This can also be seen in a June 2010 survey by ERS of registered engineers and technicians, which found the median wage of incorporated engineers was £41,345, and the median wage of chartered engineers to be £52,609.

The other point to remember how are perceptions of typical earnings in the UK are skewed by the vast amounts earned by some company directors and those in banking – a sector often accused of draining talent from the engineering graduate pool by offering salaries that manufacturing firms just can’t compete with.

Some politicians, newspaper journalists and professionals would consider £50,000, £60,000 or even £100,000 to be a middle class salary. And that’s certainly a lot less than the million-pound bonuses available in the City. But if the median salary is £26,000, then there are an awful lot of people out there for whom £50,000 would be a modest fortune.

Engineers who work hard by studying for years, gain desirable and useful skills, and help change the world for the better deserve a substantial reward. Unfortunately, engineering doesn’t always produce the kind of short-term profits that facilitate the bonuses and commissions seen in financial services.

Research and development, product design and building manufacturing facilities require substantial investment and long-term strategy, whereas moving imaginary pots of money around on a computer – while often socially useless or even damaging – can create money almost from thin air.

That’s not to say there isn’t a problem with engineering salaries, or that it wouldn’t be worth engineering firms looking again at their own payrolls if they want to encourage more young people into the sector. But engineers’ earnings are always going to be limited to some degree by the money available.

Readers' comments (74)

  • After completing a 5 year apprenticeship in tool making, and then progressing in to an Aerospace company and staying there for 15 years (on Shifts inc nights) before taking redundancy, i am now teaching students from the same areas as i have my industrial experience, to get to this point i have had to go through the pain of PTLLS, CTLLS and finally my DTLLS, i am only just earning the money i was on 7 yrs ago, do i feel anyone who has come from the workshop floor is paid enough? NO and i am sure many lecturers feel the same!

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  • To those thinking of moving to Canada for higher wages, don't bother unless you're going to Alberta to work in the oil sands. The average starting engineer in Ontario makes about $45000 a year. And now Professional Engineers Ontario is making it mandatory to be a registered Professional Engineer to practice engineering in Ontario. So make sure you do your research first.

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  • I have said it before and repeat it:
    as soon as we start charging the same way as our apparent betters do -ie we give no indication at the start of any project how much it will cost, are guaranteed payment no matter how many mistakes we make, how deceitful we are and how slowly we operate, and by doing so make work for five other 'sets' of our profession -(four sets you ask: two sets of solicitors and their hangers-on, two sets of barristers and theirs and one set of court officials -poachers turned game-keepers) we shall become the richest profession on the planet!
    Go for it!
    Mike B

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  • “Unfortunately, engineering doesn’t always produce the kind of short-term profits that facilitate the bonuses and commissions seen in financial services.”

    What is even more unfortunate is that those bonuses and commissions are “earned” from the manipulation of pensions painstakingly saved by the masses on median and lower salaries. Being one of those chartered engineers who benefits from the “modest fortune” described, I find myself nevertheless resentful towards the traders whose bonuses in a single year accrue a pot that will exceed my lifetime pot by a considerable multiplier.

    As a representative example of chartered civil engineers specialising in potable water and public health engineering, there is little doubt that our output, man for man, is intrinsically more valuable than that of the market traders or even, as testified by friends in medicine, of doctors. But none of them would get up in the morning for my modest fortune.

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  • I am 73 still I have to work for meagre state pension and ocupational pension in Mechanical Engineering sector.

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  • I hold BSc, MSc and PhD in electrical engineering from a top British university and I can't even get a *job*, let alone a poorly paid one. At age 50 it looks like I'm done. I will not encourage my son to study engineering - it's ruined my life.

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  • I'm a member of the STEM as a science and engineering ambassador. Having just managed to creep over the 30k mark, to go into schools and colleages to help students decide (influence?) on a future in science/engineering, i cant help feel that the students should not follow my steps.
    I get satisfaction in my job, but no respect, my views are often overlooked, then 2-3 years down the line, they are deemed the way to go. Respect of skills and knowledge is a great problem in this country.
    Would i advise students to follow my footsteps, no, not if they want a comforatble lifestyle.

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  • I am a chartered engineer with 6 years experience, vast amounts of ambition and still lots of energy and desire to "change the world". I am fascinated with engineering but not with the attitudes of the industry - engineers are not appreciated, and they are perceived as less important than the guys dealing with money directly. I earn 30k, and I don't foresee my wages increasing in near or further future unless I go into project management. I am ok now with 30k but if and when I have a family, I guess that won't be enough. How many people out there with heart for engineering and great skills go into less fulfilling jobs (e.g.project management) just to be able to support themselves and their families? It's nonsense.

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  • "JohnK | 1 Oct 2012 3:04 pm

    I'll repeat what I've said here a few times now. Make all Science related university education free and charge the full rate for all 'art' related courses."

    I agree. I’m part of the generation where we have been told from a young age that you must get a degree, in anything, to get a decent job.
    When I started my BEng degree in 2006, I was surprised at the amount of arts students on campus (art, fashion, journalism, graphics, film studies, drama etc), and felt some resentment towards those courses as they seemed to be getting the lions share of funding. While the university neglected the eng & tech side.

    I'm aware it's a 'supply & demand' issue, and uni’s are run more like businesses then educational centres, however do students really need to go to uni for 3 years and spend thousands of pounds a year on 'soft' courses.
    I believe the government should step in and reduce the number of people going to uni, thus reducing the cost for the 'value-adding' courses.
    As the sheer cost of courses (even a basic parametric modelling course at a local college-come-uni) is putting off people such as my self from re-training/skilling-up.

    Also, I'd like to add the industry needs to play a big part in training up the next gen of engineers. They need to be realistic, senior engineers with 5 years experience in your niche area, can't be brought in on a whim, on the last minute.
    Higher Apprenticeships are the best way to go for employers and employees (practical skills, experience & a sponsored degree), unfortunately these are few and far between, and would ‘involve long term thinking’.

    If engineers are leaving for other industries, then obviously employers need to make engineering more attractive (+ wages, career prospects, respect etc).

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  • Sol.

    Thanks for that.

    For interest, I was once allocated a Degree educated worker to my team. This person was without doubt the most stupid person I have ever met in employment. I asked him what his degree was, and how he obtained it. He said it was Philosophy and to get a degree he just turned up to 40% of the classes. Nuff said!.

    A degree has to be a discriminator between ordinary and excellent otherwise higher education itself becomes meaningless.

    As you rightly say, it will require Government intervention to make a degree once again a desirable and valued attribute.

    I know of a senior Recruitment specialist who says a lot of companies are now avoiding 'art' degree graduates as they expect high wages for no business skills whatever.

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