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Professional Engineering Salaries

October 7 1999

Salaries of Professional Engineers

Annual Salaries by Year of Graduation

Graduation        Year

Experience

 SIQR

Rel SIQR

Median

Mean/Med

  Med change

1998

0

3500

0.085

41000

1.01

1

1993

5

6000

0.115

52000

1.024

1.268

1988

10

7000

0.106

66000

1.025

1.269

1983

15

9800

0.136

71700

1.075

1.086

1978

20

10996.5

0.138

79350

1.249

1.107

1973

25

10141

0.118

85956

1.026

1.083

1968

30

13600

0.164

82554

1.042

0.96

1963

35

12500

0.147

85000

1.044

1.03

<1962

<36

14500

0.167

86350

1.115

1.016


The year of graduation plays an important factor on the salary that a professional engineer receives. Figure 1 shows the salary ranges of engineers, who have graduated between 1960 and 1998. It is quite apparent from the graph that engineers, who have recently graduated, have an annual salary that is considerably less that those engineers who have graduated from earlier years. This implies that engineers with more experience earn more than engineers with less experience.

It is also quite evident from the graph, that as the total number of year from graduation increases the difference between each salary group increase. This implies that the difference between the lower decile, the lower quartile, the median, the upper quartile, and the upper decile are relatively small for resent graduates, than for those engineers who have graduated in earlier years.


Salaries by Highest Degree
Many of today’s professional engineers have different degrees of qualifications, and the salaries they receive reflect upon their qualifications. The minimum qualification that professional engineers will have is a Bachelor of Science (BASc) degree. Other professional engineers would have either obtained a Masters of Science (MASc) degree, or a Masters of Business Administration (MBA) degree, or a doctorate (PhD) degree. Figure 2 shows the median of annual salaries, of professional engineers, by the degree of qualification. It is quite clear that the salaries of engineers are proportional to the level of education that they have received with exception to those engineers with a MBA degree. Engineers with a MBA degree had the highest median salaries. Engineers with an MBA degrees were highest paid because they are more important in the business sector.

In addition, the annual salary increases in approximately equal intervals, as the qualification of the engineer increases form a BASc degree to a MASc degree, to a Phd degree. However, the difference in the salaries of engineers with a MBA degree and engineers with a Phd degree is relatively smaller, when compared.


Annual Salaries by Size of Organization
The salaries of professional engineers vary with the size of the company. Figure 3 shows the variations of engineers at different salary brackets in companies of different sizes. From the graph it is quite apparent that engineers at large companies, employing over five hundred people, receive the highest salaries, and engineers at smaller companies, employing fewer than twenty-five people, receive the lowest salaries.

The difference in the lower quartile salary range of engineers at large companies versus those at smaller companies, is greater than the difference of those engineeres with median salaries. In addition, the difference in the median salary range of engineers at larger companies versus those at smaller companies, is greater than the difference of those engineers in the upper quartile range.


Conclusions and Recommendations
There are many factors to consider when deciding the pay for engineers. These factors include the year of graduation, the size of the company, and the degree with which the engineer has graduated.

To make a solid recommendation, a description on the types of engineers and the duties that they would be performing is required. If the objective is to minimize costs, the best solution is to hire a team of engineers who have recently graduated with a BASc. However, it is my recommendation that a strong engineering team will be composed of engineers with different qualifications and different years of experience.


Reference
1. PEO, Professional Engineers of Ontario, Toronto, date accessed: October 4, 1999.