The STEM Index

Link to the U.S. News/Raytheon STEM Index.  The main thing that bothers me and many others is the notion of a demand-supply STEM problem and yet you don't see this translate into significant salary adjustments.  Does the "average" mechancial engineering student coming out of Purdue have so much employment opportunitiy that he or she has the ability to set the market price?  I always get the feeling when policy makers and executives talk about a shortage of engineers, what they are really thinking is a shortage of low-cost engineers.  Remember the three major players in the STEM shortage debate - (1.) the universities that have huge economic benefits in convincing students of a STEM shortage, (2.) industry that wants to minimize the cost of engineering talent, and (3) the individual engineer that will benefit from an actual shortage of STEM talent.  Medical doctors and the American Medical Association (AMA) are the masters of professional supply-demand control - organizations like the American Society of Civil Engineers are rather clueless.

This is another view (the income view) of the STEM debate from the United Kingdom.  From the Institue of Mechanical Engineers:

"Chartered engineers are paid an average of £63,000 a year, a salary survey by the Engineering Council has revealed.

The median total earnings average, inclusive of bonuses, overtime and commission payments, represents a 14.5% increase since 2010, the last time the research was carried out.

Incorporated engineers, meanwhile, can expect to earn £45,500, while engineering technicians get an average of £40,000. These figures are up 5.1% and 8.1% respectively compared with 2010.

The figures were welcomed by the Engineering Council, the regulatory authority for professional engineers, which commissioned the survey, as a clear sign that engineers’ pay is starting to more accurately reflect their high level of education and knowledge.

Jon Prichard, chief executive of the Engineering Council, said: “The figures show that a career in engineering can be financially rewarding. The national average wage is £26,000 – so the survey shows that engineers can expect to earn a significantly enhanced amount over the course of their career through professional qualification.

“Of course, there are many disciplines within engineering – and some have better wages than others – but at the end of the day engineers can expect a reasonable reward for what they do.”

Prichard admitted that some other professions, such as banking, offered ‘megabucks’ salaries that engineering was unlikely to be able to match. But he said that only a very small percentage of the population could expect to earn the ‘ludicrous salaries’ that were occassionally recorded in the City. “Also, careers are about more than money,” he said. “Yes, financial reward is important, but so is progression and job satisfaction, and I believe most engineers get tremendous satisfaction and work/life balance.”

Prichard said that now was a good time to be an engineer, with companies such as Jaguar Land Rover creating jobs and opening plants, and large construction projects such as Crossrail and the Thames Tideway Tunnel also producing significant employment opportunities. And he said that engineering also offered ample scope to live and work abroad. “Eighteen per cent of UK-registered engineers work overseas. The rest of the world still looks at the UK as an engineering nation. I think that sometimes we forget that.”

One area of disappointment with the figures in the survey was the large disparity between what male and female engineers earn, particulary at the upper end of the age scale. The median basic income for male registered engineers and technicians was recorded as being 18% higher than for their female counterparts aged 55 and over, narrowing to 6.7% among those aged 21 to 24.

Prichard attributed this to a division in the sorts of roles that male and female engineers tend to prefer. “This is only a personal reflection,” he said, “but it might be down to the fact that some females prefer more environmentally-friendly positions within engineering, and the roles that relate to the environment tend to be less rewarding than those with more of a commercial focus, which involve the management of contracts. Perhaps the difference in salaries reflects that.”

The 2013 Survey of Professionally Registered Engineers and Technicians was based on responses from 6,321 registered engineers and technicians resident in the UK and below the age of 65. The salary statistics were produced using median averages, although Prichard said there were “no significant distortions” in the figures caused by ultra-high earning engineers at the very top end of the pay scale.

Overall, the Engineering Council said the findings of the survey were very encouraging. “Engineers have enjoyed clear progression in salaries over the past few years at a time when many others, particularly in the state sector, have not had any significant increases.”