Tuesday, 23 September 2014
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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 (68)

  • Looking at the person who teaches engineering and who only earns 27 k well are you not in education and education is not engineering after all, so what do you expect. Compare your salary to you colleagues in teaching and not engineers. If I remember teachers get lots of holidays and are divorced from the day to day demands of making a profit. Further, if you are so good why did you leave engineering? Good engineers are hard to find and are gradually being recognised and rewarded for there expertise and knowledge.

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  • "If I remember teachers get lots of holidays and are divorced from the day to day demands of making a profit."

    I am a college lecturer (not a teacher) and your assumptions are out of date.
    I get 35 days holiday and for your information further education colleges do run as a business and strive to make a surplus - hence the falling salaries. Like most lecturers I spend some of my evenings and weekend preparing learning materials, planning and marking; all unpaid to keep college costs down.

    Who educates technicians and engineers? Answer: Engineers who moved from industry to education because they think teaching the next/current generation is important.

    Without us there will be no technicians or engineers in the future!

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  • When I was at college, we had quite a leftie lecturer who insisted that "..one day, you engineers will be valued and paid what you're worth and you'll be running the country" That was 30 years ago, and it ain't happened yet.
    The comment above, on getting a degree for turning up for 40% of the lessons, doesn't surprise me either. We've been dumbing down the entire education system for too long now.

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  • Sad to hear that engineers are so undervalued in the UK. *Starting* salaries in the US are over $50,000 USD/yr, and that's for someone with a basic Bachelor of Science degree in almost any engineering field. In more specialized fields like Aerospace and Chemical engineering, the baseline salaries are higher.

    I guess to summarize, while I agree that that engineers aren't compensated enough for their contribution to society, at least here in the US we're able to earn a solid, middle-class, living wage. I'm able to keep a roof over my head, food on my belly, clothes on my back, maintain multiple cars in the driveway, and have enough left over to put a little away in the bank.

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  • 15% on wages doesn't mean anything in lifestyle. It is also because of egalitarian/socialist wage/benefits discrimination.
    Let's say engineer earning 30k, 3kids at home, with added cost of driving 1hour to work, mentally fully engaged, with work-stress lasting over the leisure time is in fact in no better situation than a person doing simple job locally or pulling the benefits!
    What motivation we're talking about?

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  • I have graduated in 2006 from a US University in Electrical Engineering. I moved back to the UK when I could not find a job quickly enough. My first job in the UK as an Automation Engineer started at £18000, but grew to £24K within three years. In addition the company gave me extra and I was on £27.5K by the start of the 4th year. I have now moved companies as I realized I would stagnate myself and now earn £32K as a software/electronics engineer.

    My point is maybe shifting every so often will help push your career on (I think there is another article I saw on this subject). I still think that my salary now is not good enough and I am still looking for ways to grow it. That may in reality mean having to leave engineering all together!

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  • I've now got 8 years experience, and have a 2:1 in Aerospace Engineering 4 A-Levels @ Grade B or above. I can't say this surprises me, when I've been through the forms for Chartered Engineer, there's a section that asks what you do to promote the profession?? I can never bring myself to do it....

    I spend long amounts of my time looking at large amounts of tedious data in infinite detail, rarely have the privilege to do anything interesting and earn a little over £30K.

    I've been subject to paycuts, and long hours (sometimes weekends too) citing the phrase...."to return the company to a more profitable state" the company recorded £400m in profits that year, it bites a bit that directors and shareholders manage to squash innovation by first lining their pockets. If I had my time again, I would of gone into something far more lucrative, as Engineering is right at the bottom of the food chain, I continually vote with my feet something that seems to get me a payrise. My quality of life suffers as I have moved 3 times in 6 years just to get rise. In one instance I'd asked for a £2k payrise to have it refused, and that position remained unfilled for over a year, it really shows how unwilling companies are to support the very talent that helps it to thrive. Many companies seem much happier to honour accountants, shareholders and solicitors.

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  • The comments on this page ring true.

    Short-term decisions by cynical managers have ruined the department I work in. Despite having a masters, doctorate and CEng (with only ever grudging support from any company I have worked for), I now feel condemned to a life of Dilbert-esque futility. Contracting now seems like the best option - ability to change jobs when you get bored / have done too much of the same thing, better hourly rate, massively reduced amounts of politics and meetings...

    Some non-sensical quotes and my translation from the tubby suits that run my sector of the engineering 'profession':

    "We don't support chartership - once people finish the graduate scheme the rest is up to them" (i.e. we don't have a systematice development scheme here)

    "We don't support chartership as it's hard enough to find engineers already" (i.e. you're more likely to leave once you're chartered)

    "As a customer we don't make chartership a requirement [for signing off drawings] as [your] products already cost too much" (i.e. you already try to screw us with the skills argument - the rest is up to you)

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  • I have worked in many countries during my career and know that being an engineer in some countries has a status equal to doctors and politicians. For me, being an engineer still has the infectious desire to learn and understand more but more importantly being given the opportunity to question theories and designs. The world through an engineers eyes is one of simplistic solutions and the ability to understand why. You cannot put a value to this, the engineer lives to be continually challenged, pity this is with salary and the challenge is survival. Wouldn't change my profession at all, I am an engineer and proud of my decision to become one.

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  • This is why no one wants to do engineering. The salary is terrible.

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