I'm sorry to contradict everybody else, but I've had a job as an electrical engineer for about 30 years, and I'm still doing fine.
Actually, I think unemployment in engineering has always been lower than most areas. I don't see what the problem is.
US high-tech companies aren't outsouring their core business to China or India.
As far as I know, China workers in Intel China are working around CPU, BIOS design, firmware design, testing...most of their work aren't related to CPU design completely. And Microsoft is doing the same thing, most software engineers in China Microsoft are doing Windows localization(to display mandarin), testing, test tools dev, user interface or software dev on top of windows. And even researcher's topics are user interface.
Mark LePedus: "Here's the big questions: Based on this data, are U.S. engineers at a disadvantage? Is the handwriting on the wall for U.S.-trained engineers? Is that what all multinationals must do to compete by hiring in China and elsewhere? Is the salary situation unfair or not?"
Mark, my comment is in specific to the above question you raised. Digital processing of bits is killing everything. It is destroying the value of the skill behind the product's development, the value of the product, the shelf-life of the product, the price of the product and any differentiator this product has. Salaries of the engineers in a product development project are really a reflection of the average price of the product in the market. In the past the salaries were somewhat a reflection of the skill because the higher the skill the better the product's price in the market. But that relationship of higher skill to better end product's price is broken by digitization. In the analog field we are not seeing this kind of rapid attrition of salaries, can anyone comment? From my viewpoint (of a semiconductor chip company with China domestic market focus), I don't see a whole lot of analog talent from China that is on par with the US talent, but others may have a better view.
Innovation itself needs to be re-thought. As long as the implementation is all done still in digital world, the standard mantra of be-innovative etc., wouldn't cut it deep enough to create a favorable change for the US engineer salaries. A better mouse-trap is a predictable innovation, only lasts one product cycle and after that the Chinese powers of improvization will take over and destroy the value of this innovation. What we need is something that I can only say with a handwave as unpredictable innovation. Or call it disruptive innovation. US engineers are best at this. If we look around we see that US engineering world is not the only place we are seeing the destruction of value, of salaries etc. The newspaper industry is full of such stories, granted that's not exactly a haven for innovative ideas. Like I was saying, US engineers are best at this kind of disruptive innovation. It is for us to be self-aware of this strength and make what we can with it.
I am just looking forward to the day that a board of directors in their due diligence decides that a CEO candidate from Indochina willing to work for 1/5 what the US Cana date wants is best for the company. Oh boy, when that shoe drops what wailing and gnashing of teeth there will be. I can't wait.
Don and PowerGuy and many others here have it right. The "World if Flat" and all an engineer in the US can do is be better, smarter and faster at developing new skills and moving to the new markets which the low cost international cannot keep up with. So yes a lot of basic, mundane logic/circuit jobs are devalued, but there are still opportunities in architecture, system design. The US is still the best environment for innovation and startups. In my last position I spent a lot of time and effort to bring up labs in India, China as there was pressure "from the top" to develop these geographies as this was seen as the trend towards competing internationally. Actually my top paid US engineers were more than 10 times valuable than their international peers because of their level of skill and ability to innovate. Upper management was offended when I opined that globalized teams were harder to manage, put overhead on the organization and did not actually give a good return even though on a per unit basis they appeared less expensive. So chin-up US engineers you are more capable and should be proud of it.
There are a number of key structural issues to consider beyond abuse of H1B and low cost labor (either here or in Asia).
Already raised is education - the quality (pre-University) and cost (University level) of US schooling combined with lack of interest in science and engineering is as much of a long term issue for our future as the demographic bomb of an aging population. (secret tip - send your kids to school overseas, it is cheaper and a great experience).
The direct labor costs difference is declining but still exists, but as mentioned by BobGroh the hidden costs are climbing or becoming more apparent. A huge issue when offshoring manufacturing is actually taxation treatment. A number of Asian countries which have large surpluses offer long generous tax holidays which means that regardless of labor costs you can immediately add 25%-35% to your gross margin (equal to your US tax rate). The US can't compete with this due to the massive deficits we're running. (By contrast reducing labor costs to 1/5th would impact gross margin by much less than this, as it is only one component of cost of goods).
Then there is healthcare. Aside from most of the current arguments out there is the basic fact that US companies are carrying an unfair burden of health costs when compared to competitor countries. Subsidies and trade barriers get fought over (and mostly eliminated), but healthcare as a competitive disadvantage doesn't come up much in discussion.
I just want someone to tell me when:
- There are no more engineers left in the NA/Europe who design exportable products
- There are no more s/w people in these areas doing exportable products
- There is no more leading medical development (as it can be off shored as well).
... what the heck those in China and to a lesser extent India are going to buy from us? The trade imbalance is already enormous. The more that is off-shored, the bigger it will get..... but wait, it will start to shrink. No one here will be able to afford anything any more from China. I wonder how long it will take before balance comes back into play?
I'm now retired and glad of it. It is brutal out there in EE land and will continue to be for a while. I do think the pendulum is swinging back a bit on the off-shoring phenomena - working 'globally' is not a total bed of roses. There are considerable obstacles (e.g. language differences, considerable lack of skill sets and experience, cultural differences) which, up to this point, have been mitigated by the much lower wages overseas. However the wages 'over there' are rapidly increasing at the same time as management here is becoming more aware of the trade-offs. This is leading to some increase in possibilities for domestic engineers. Still lots of problems (e.g. loss of manufacturing, management attitudes) but, eventually, things will even out. But, as I said at the start, I'm glad I'm out of it and I do feel for today's EE - whether a new graduate or an experienced veteran, it is tough and it is going to stay tough.
Tough to be in the midst of a rapidly changing world. World economic competition still beats the quicker death from traditional armed conflict though.It's a fact that the world is filled with smart people; many more highly motivated (by a hungry belly) than the relatively affluent average American. If our economic/political system has an advantage, it is in the flexibility that a measure of personal independence brings to business. We must (once again) innovate our way out: it's what is left to us. To do that, we MUST return to a quality public education system that will provide the tools for our sons and daughters to compete in the world market. Meanwhile, 'Boomers (like me) had best keep on holding the fort. That may be the silver lining in the collapse of our retirement funds. Another thought: the simple majority of the people I work with are highly educated, extremely competent, happy, and are foreign born (probably with no intention of leaving). That's a testament to the power of a(relatively) open society.
Thanks "TheDon", it's always nice to see "a glass is half full" viewpoint, I hope your right!
When your my age (been doing engineering 20+ years) and you've been through many project cancellations, layoffs, right sizing and down sizing, asked to train your peers in India, etc. and now your trying to put your three kids through college while trying to save anything at all for retirement (if there is such a thing any more, my retirement now looks like a orange vest at Home Depot :-), etc. Well I honestly hope you will have kept your positive attitude :-)
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