The pay raise engineers have been waiting for

Results from the 2018 salary surveyCover Story Sep-Oct Main img

By Cory Fogg

The financial situation of the average automation engineer got a nice boost in 2018. As the salary of the average automation professional rose for the fifth consecutive year, our salary survey found incremental growth greater than 5% for the first time since 2010 (5.3% in the U.S., 1.5% globally). So are today's automation engineers finally getting their due? A bigger boost in salaries has been anticipated for quite some time. Manufacturing and automation analysts have long pointed toward a looming skills gap, estimating more than 3 million jobs will need to be filled in the next decade. As this year's survey shows, that certainly seems reflected in automation salaries, as a career in the industry is increasingly becoming a financially rewarding decision.

With the rise of the Industrial Internet of Things and increasingly connected technology requiring advanced considerations in both cybersecurity and system design, the role of today's engineer is more crucial and complex than ever. Yet for the past few years of this survey, we saw only modest gains in salary. From 2013 to 2017, the average salary rose a total of 5.6%, just barely above the gain for 2018 alone. Some of the most prominent gains were:

  • Average salaries for entry-level professionals in the U.S. (fewer than two years of experience) increased 13.7%.
  • Average salaries for professionals with graduate school/advanced degrees increased 7.2%.
  • The two largest raises, proportionally, went to engineering consulting (9.9%) and process/plant/manufacturing engineering (10.7%).

While we still have not seen any signs that the labor gap is being bridged, we can say that the increasing demand for automation professionals has finally taken that significant step up that we have been expecting for years. With the need for experienced professionals still growing, we anticipate the demand to remain strong for engineers for the foreseeable future, with a great deal of opportunity for young graduates and those who are interested in a STEM career.

Five factors of salary determination

Through our years of conducting this salary survey, we have identified the five major factors that determine salary:

  • geographic region
  • job function
  • level of education
  • industry segment
  • years of experience

Our survey collected more than 1,900 responses from automation professionals located around the world, including 1,290 from the U.S. Salaries from country to country and region to region vary greatly, so our analysis separates the U.S. responses in order to avoid skewing results. All of the results quoted in this article, other than average salary by region of the world, represent U.S. responses only.


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Who were our respondents?

Our primary respondent (making up nearly 27% of total respondents) was a U.S.-based automation/control engineer, but the 1,903 respondents come from all over the world, with a variety of job functions. Our respondents tended to be heavily experienced, with 63.2% counting more than 21 years of experience. Engineers continue to become increasingly educated with over 70% of respondents having at least a bachelor's degree and 21.6% an advanced degree. On the whole, 76.4% of our respondents reported some sort of salary increase this year, with the largest percentage (31.4%) seeing about a 3-4% increase.

Just over a fifth of our global respondents (22.1%) reported a salary in the $100,000-$124,999 pay range. The second largest pay range reported (14.8%) was from $125,000 to $149,999.


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Around the world

As the chart indicates, the typical engineer salary depends heavily on region, and more heavily on country. The typical U.S. engineer, for example, can expect 2.5 times the compensation of an engineer in neighboring Mexico. Similarly, engineers in eastern Europe should expect to make less than half as much as a western European engineer. Talking about the western Europeans, they also saw the highest growth in salary (17.3% average rise!). South Asian respondents reported a 24.4% increase in salary. That moves the region up four spots and out of the bottom in engineer compensation, where it was last year. African, South American, and Mexican respondents all reported salary decreases from last year.

Spotlight on U.S. engineers

Where the U.S. engineer is concerned, however, the financial future continues to be bright. The average salary continues to rise, posting its biggest incremental gain in nearly a decade during 2018.

As we mentioned earlier, the period between 2013 and 2017 saw salaries rise by a cumulative percentage that was just higher (5.6% to 5.3%) than 2018 alone. Over that five-year period, the average salary increased around $6,200, compared to an average $6,300 raise in 2018. This continues a decade of strong growth that shows U.S. engineers increasing their average salary by more than $20,000 per year since 2010. Where we have voiced concern in past surveys that the financial compensation of engineers had not been rising significantly with the demand, 2018 showed the U.S. engineer's value clearly on the rise.

Does location matter for U.S. engineers?

Much like the world, all U.S. regions are not equal when it comes to engineer pay. The West South Central region, which includes engineer-rich Texas, has long held the title of best pay for engineers. The region was highest again in 2018, but the statistics showed the Pacific region, especially California, right on its heels. (*Regions are defined on Wikipedia.)

Only one region in the U.S., the South Atlantic region, reported an average salary decrease in 2018. The largest percentage increases were in the Pacific region (9.5% increase) and the West North Central region (6.9% increase).


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In-depth look at automation/control

As nearly 40% of our U.S.-based survey respondents are in the automation/control job function, we always take an in-depth look at the statistics of this particular engineer. The automation/control engineers got their share of the pay increase, registering their own pay rise of more than 5%.

After seeing just a $6,487 (6.3%) rise in average salary over the 2012-2017 timespan, and a miniscule $1,393 (1.2%) in 2017, automation/control engineers reported an average gain of over $6,300 in 2018. With all the concern about a looming skills gap, and the number of aging and retiring engineers continuing to rise, this significant increase in compensation is a nice trend to see. Although automation/control engineers probably cannot expect 5% gains every year, we see a favorable environment for today's engineer and no signs of that environment waning any time soon.


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Job function matters

Of course, there are plenty of job functions for engineers other than automation and control, and we did not ignore them. In fact, the number of functions and specializations available for today's engineers continue to increase, as we included information technology and education functions in the 2018 survey to better reflect all the options open for today's engineer.

Every single job function registered an increase in the past year, save two. Engineering management and operations and maintenance were the only two functions that decreased in average salary. Engineering consultants were apparently in very high demand. They reported an average salary increase of almost $14,000 over 2017; their rise was followed closely by the process/plant/manufacturing engineers, who reported an increase of around $12,500.


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ROI for engineering degrees

Although we cannot guarantee a return on investment (ROI) on a liberal arts degree today, engineering is very clearly a field where a degree can be quite lucrative. Seventy percent of our respondents were college graduates. Engineers with a graduate degree averaged salaries that were nearly $14,000 higher annually than those with a bachelor's, and $29,000 more annually than those with solely a high school degree.

Student debt is the bane of many a young professional's existence, but those with engineering degrees should statistically not have much of a problem. With the increases for each level of degree, and the current financial statistics, the average engineer should be well placed to pay off his or her degree in just a few years.


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Choosing the right industry

While education level is a big salary separator, the industry an engineer works in also has a very significant impact. The average oil and gas engineer, for example, makes nearly $40,000 more than the typical water/wastewater engineer.

It is fascinating to note, however, that despite being the highest-paying industry segment, oil and gas was the only segment to report a decrease in annual salary. Every other segment posted an average annual raise of more than $3,000. The chemical industry (9.4% increase) and the industrial machinery and equipment segments (9.3%) saw the highest average growth over the past year.


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Pay your dues

Of all the salary differentiators, however, none matters nearly as much as experience. As it has for every year of the survey, the 30-year veteran's salary greatly outstrips that of the rookie wrench turner. This year's numbers continue to tell the same story.

If you have passed your 30-year mark in engineering, you are likely sitting pretty financially compared to the entry-level engineer, to the tune of an average salary almost $60,000 higher. This seems to be common sense, but it also gives us the biggest red flag when it comes to future engineering salaries.

Although engineers at all levels of experience saw raises in 2018 (except for the 21-25 years of experience group, interestingly), we also noted that 63.2% of respondents came in with 21 or more years of experience, and just 6% with less than five years. There are many variables that prohibit us from reading into this statistic too heavily, but it does raise the question whether or not closing the skills gap would actually decrease the average engineer salary.

Here again, however, this salary survey does not give us a definitive conclusion on how the skills gap is affecting the industry, more that engineering is an increasingly lucrative field to get into, with a significant capability to improve that standing throughout a career.


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Job satisfaction on the rise?

While a high salary can be a big driver to that end, job satisfaction is not necessarily based on financial compensation. As such, we ask respondents to tell us if they are seeking other opportunities, in order to help gauge the mindset of today's engineer. Positively, over half of all respondents tell us they are not seeking new opportunities, passively or actively. Pay appeared to be a factor, as U.S.-based active job seekers had an average salary of $110,275 —more than $14,000 less than those who were not seeking a new opportunity. The majority of job seekers, however, were just passively looking. They made up 37% of respondents, making about $3,000 more than active seekers and $10,000 less than nonseekers. Appropriately, the average salary was $119,354, above the averages for active and passive seekers, but below the average salary for nonseekers.

 
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Fast Forward

  • Incremental salary growth was greater than 5% for the first time in eight years, and salary growth for entry-level engineers in the U.S. was more than 10%.
  • Engineering consulting and process, plant, and manufacturing engineering received the largest raises, while engineering management and operations and maintenance decreased in average salary.
  • Oil and gas continued to pay the biggest salaries, but was the only industry segment to report a decrease in average salaries.
 

About the Author

Cory Fogg is the content editor at Automation.com.

Recipe to maximize your salary

As we do every year, we conclude our survey with a time-tested recipe* for how automation professionals can maximize their salaries. Like any great recipe, we tinker a bit, but the main ingredients have not changed much over the years.

  • Get your bachelor of science degree (any type of engineering will do). Then get your advanced degree (bonus points if you get your company to pay for it).
  • Live in the U.S. or Western Europe. California and Texas remain the highest-paying states for today's engineers, but every U.S. region averages six figures.
  • Get into engineering/
    integration consulting, an area of great momentum. Chemical and oil and gas are also well-paying options. If money is your primary goal, avoid water/wastewater.
  • Show off your leadership attributes and get into management. Management gets paid.
  • Become indispensable to your managers and company. Become an expert on useful, new technology and trends. Your company will not want to lose you if you make or save money.
  • Stick with your profession-engineering has a lucrative career ladder. There are not many industries that have six-figure earning potential within 10 years of entry.
  • Advocate for yourself. At the end of the day, any profitable organization's priority is the bottom line, which means the person who will best look out for your bottom line is you. Other companies want your skills, and it is not wrong to remind your boss of that with an offer sheet.

*Results may vary depending on attitude.

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