By: Leslie Stevens-Huffman
It’s so hard to find industrial engineers in Houston, that veteran contractors command premium pay. Meanwhile, miles away in Detroit, automakers are letting employees bring their dogs to work in order to keep high flying Silicon Valley firms from poaching prized engineers.
There’s no empirical evidence of a general shortage of engineers, according to Michael S. Teitelbaum, Harvard Law School demographer and senior advisor at the Alfred P. Sloan Foundation. But he notes that at any time there are spot shortages based upon rapid growth of certain specialties, or regional supply and demand disparities, and those shortfalls have a direct impact on the contract labor market.
Growing Specialties and Skills
The fastest growing specialty is petroleum engineering, where jobs have increased 76 percent in the last 10 years. Now, U.S. energy companies plan to hire another 5,000 engineers by decade’s end. At the same time, retirements of full-time workers are projected to increase as 55 percent of the current workforce between the ages of 45 to 64.
Contractors can earn 10 to 15 percent above the market rate for permanent employees when talent shortages occur, according to Joe Salvucci, CEO of Peak Technical Staffing USA. The looming shortage could drive hourly rates for petroleum engineering contractors sky high. Currently, petroleum engineers are the highest paid engineering professionals, earning a median salary of $114,080. The top 10 percent earn over $166,000.
Biomedical engineering is the second fastest growing specialty and experts say the profession could experience wage inflation due to spot labor shortages. While some 21,000 professionals currently work in that field, the BLS projects a whopping 61.7 percent growth of job opportunities by 2020. In fact, Forbes calls biomedical engineering the major most worthy of a student’s time, effort and tuition. It’s no wonder, with a median starting salary of $53,800, which grows an average of 82 percent to $97,800 by mid-career.
In addition to traditional engineering skills and certifications, the number of job ads requesting CAD knowledge or experience was up 14 percent in September over the prior year, making it more difficult to find contract professionals with those skills. In fact, Autodesk AutoCAD is more commonly listed as a qualification in online job ads than Six Sigma skills, according to WANTED Technologies, which tracks supply and demand for employees across U.S. markets.
Regional Talent Shortages
On average, U.S. employers advertise for 6.5 weeks to fill engineering jobs, according to data from WANTED Technologies. But regional imbalances can extend the search period by 2.5 weeks for mechanical, electrical or industrial engineers. To avoid a talent crunch, engineering managers need to plan ahead and consider offering travel allowances so recruiters can source experienced contractors from regions with greater supply and fewer opportunities. Here are some trends in key engineering job sectors.
The overall unemployment rate for mechanical engineers is just 2.4 percent. Some of the toughest places to find workers include: Detroit, New Orleans, State College, Pennsylvania, Albany, New York and Logan, Utah. Better recruiting locations include: Las Vegas, Fort Walton Beach, Florida and Scranton, Pennsylvania.
With demand for electrical engineers surging over the last decade, and an overall unemployment rate of just 3.4 percent, it’s a candidate’s market in Albany, N.Y., as well as Charlotte and Raleigh, North Carolina. Better locations for recruiting on the East Coast include Poughkeepsie and Binghamton, New York.
There are 145,000 industrial engineering jobs in the manufacturing sector, which comprises 1.2 percent of the industry’s workforce. Houston, Milwaukee and the San Francisco Bay Area are among the toughest places to find talent. Houston companies should try Longview, Texas and Houma, Louisiana, while Milwaukee companies should consider expanding their search to Decatur, Illinois and Kokomo, Indiana. We already know that San Francisco Bay Area companies are searching for talent in the Motor City, but data shows that it might be more fruitful to take the dog fight for engineering talent to Kennewick, Washington.