John Wright rode the tech bubble of the 1990s for all it was worth, hopping jobs and moving up to a six-figure salary. Hefty bonuses and stock options nearly doubled his income. But when the bubble burst, Wright spent nearly three years without a job.
When the dot-com boom began, Wright had a good job as an engineer at Cypress Semiconductor, an established and stable outfit in San Jose, Calif. But in the heady summer of 2000, a headhunter caught Wright in what he describes as ”a moment of weakness” with an offer from a telecom start-up.
Wright stayed with the telecom start-up for about a year, before jumping ship again with an offer from another start-up, enticed by a generous salary, bonuses, and stock perks. ”If everything went right, I'd be set for life,” Wright figured.
Instead, another year brought him a pink slip, and Wright was out of a job. He had socked away enough funds to cover his bills for six months, but it would be another two-and-a-half years until he landed a new job, this time with a defense contractor. His pay has returned to a pre-bubble five-digit salary figure. ”The money's right for the job I'm doing. I'm very happy here, and it's a stable environment,” says Wright, now a senior systems engineer [see photo, ”Better Times”].
Wright is not alone among engineers in valuing job security highly. They have ample reason: while engineering wages are moving upward a bit faster than inflation again, bonuses and stock options are now harder to come by. Instead of expecting to hit the jackpot, many engineers are simply looking for interesting jobs that won't disappear—to the benefit of many established companies that found it difficult to compete with the extravagant compensation many start-ups were offering during the boom. Now, ”it's surprising how many times experienced people say they want to work for a stable company,” says Mark Finger, vice president of human resources at National Instruments, in Austin, Texas.
Engineers who aren't changing jobs are continuing to see small wage increases. ”We're seeing salary increases of 3 to 5 percent,” says Steve Patchel, senior compensation consultant at Watson Wyatt Worldwide, of Santa Clara, Calif. That's slightly more than they were getting during 2005, he adds.
Other yardsticks show slightly higher salary increases over the past year. IEEE-USA figures show wage improvement in 2005, after a decline in 2004. The median salary for 2005 was US $97 672, up 5.6 percent from $92 500 in 2004. However, this 2005 figure is virtually the same as 2003's median of $96 787—not enough to keep up with inflation overall, notes Chris Currie, IEEE-USA's manager of product development and marketing. Lackluster raises are also being seen across the Atlantic. ”Salaries in Europe are pretty flat; it's similar to the U.S.,” Finger says.
While EE wages in developed countries in general show little change, there are always niches in which raises tend to be more generous. ”In some select areas, such as nanotech and medical devices, they have increased 10 to 12 percent,” said Scott Sargis, president of Strategic Search Corp., of Chicago.
Sargis also notes that many electronics companies are working more closely with colleges these days, recruiting high-scoring sophomores and even freshmen for internships in an attempt to lock them in early. Though these companies are going after students more aggressively, starting salaries for new graduates aren't moving upward rapidly. Computer engineers can now expect $54 877 on average, while EEs will average $52 899, according to the National Association of Colleges and Employers, in Bethlehem, Pa. Those averages are both up only slightly from the 2005 average of $51 292 for EEs.
Salaries in low-wage countries are rising far more rapidly. Engineers in the Asia-Pacific region earn far less than their American counterparts, but percentage-wise their raises are currently far heftier.
”Salaries in India and China are moving much faster—doubling or even more than doubling—but the cost [of employing engineers there] is still a third to a quarter what we see in the U.S.,” National Instruments' Finger says.