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If your salary is under $100,000, don't feel too badly, especially if you're married with a working spouse. Together, the two of you may hit that six-figure mark. Two-income EE families (53 percent of the married EEs say their spouses have paid jobs) earned a mean of $101,700 in the 1997 survey. In the third year of 20 percent growth in the stock market, stocks and options continue to take on growing importance in engineers' portfolios. Thirty-five of the 679 respondents say their stock options are worth more than $100,000. However, they may or may not have cashed in those options yet. Some 35 respondents report actually owning $100,000 or more of the company stock. We don't know if those are the same 35.
 The h eadquarters of the Six Figure Club falls squarely in San Jose, Calif. Get this: 19.6 percent of the EE respondents from the San Jose area codes earn between $100,000 and $119,999. Another 7.8 percent top $120,000. "The wealthy are getting wealthier," said Robert Rivers, editor of Engineering Manpower newsletter, quoting from the 1997 IEEE U.S. Membership Salary & Fringe Benefit Survey. That study found the range between the highest- and lowest-paid full-time engineers was $80,000, some $10,000 higher than in previous years. "Silicon Valley likes to think of itself as the center of the universe," Rivers said. "Silicon Valley is not the world. Not the real world." Clearing out the clouds, we get a wage picture that suggests sharp increases for some segments of our readership, even in the real world. There are two ways to look at the $2,300 increase in EE wages this year over 1996 levels. If we look at the entire sample of 679 engineers and managers, the percentage increase was only 3.5 percent-about 1 percentage point higher than the current inflation rate, and about par for professionals generally. That supports the arguments of those who insist there's no shortage of engineers. If there's a shortage, they say, where's the salary inflation? Presumably, employers would be paying much more to get the people they need. A 3.5 percent increase is hardly evidence of desperation.
If we look only at the 84 percent of respondents who received raises and eliminate the 16 percent who, for whatever reason, got no pay hike in a boom year for the profession, the average increase was a considerably higher 8.7 percent, skewed to some extent by the highest earners. The median, or halfway point, is a milder 5.68 percent. In other words, if you got a raise, chances are it wasn't for 3.5 percent; it fell somewhere between 5 and 8 percent (depending on whether you use the median or the mean). Only 28 percent of the readers said their '96-97 raise was 4 percent or under. Almost a third of the sample reported double-digit increases, swamping the Consumer Price Index hikes of 5.8 percent over the past two years. By the way: If your boss sees these numbers and says, "Yeah, but it's the managers who get these big hikes," point out the next statistic. Our 109 senior engineers-who are, in most companies, not the top rung of management-averaged 9 percent raises last year (5.91 percent median).
Other pay hikes in percentage:
Hopefully, Federal Reserve chairman Alan Greenspan doesn't read EE Times . The Six Figure Club is, by the way, relatively accessible to engineers in Japan as well. The 515 respondents from Nikkei Electronics magazine who responded to a shorter version of the EE Times survey had a mean total income of $74,400. But a healthy 18 percent earned between $100,000 and $119,999, and 17 percent went above that. While that sounds good, remember that real estate in Tokyo is ferociously expensive, even by Silicon Valley standards, and the EEs don't get as much house for the yen as their U.S. counterparts.
More than half of our respondents believe their salaries are "comparable to others" in their field. Another 38 percent think they're underpaid, while 8 percent can't believe their good luck: They think they're paid more than others in their field.
"My salary is determined partially by emplo yment market conditions and partially by my contributions to the company's bottom line. I think that is as it should be," said a software engineer. The most disaffected: 60 percent of the chief engineers don't think they're keeping pace. "Salaries unfair," writes one respondent. "Do-nothings overpaid; hard workers underpaid. Bonuses only for management." Employers beware: In this job market, disgruntled engineers are highly vulnerable to job pitches from recruiters. Later in the survey, you'll see that engineers rank "increase in base salaries" as the "most appealing" factor in considering a job change. The 16 percent of respondents who didn't get a raise in the last 12 months have to be wondering what it takes. "Compensation is based largely on 'fear of loss' of employee and not on performance/promotions," said a Virginia project engineer. The Japanese respondents, incidentally, showed numbers similar to ours: 52 percent see their salaries as comparable to others in the field, while 41 percent think they're being paid less. So how do you hit the magic number? Management experience certainly helps. Some 46 of the 56 respondents in the $100,000 salary category have some managerial-level responsibilities, though not necessarily at a corporate level. For instance, eight senior engineers are members of the Six Figure Club, along with seven non-managers.
More than likely, they've got some in-demand skills that employers will break the bank for. Skills that seem to differentiate the Six-Figure Engineer from his lower-paid counterparts include:
Other factors characteristic of six-figure engineers:
At one time, American engineers relied on a fixed base salary for almost 100 percent of their pay. They received minimal overtime, bonuses or profit sharing. Well, overtime pay is still a luxury for 87 percent of our respondents. Not a dime of overtime did they see last year. But the bonus structure is transforming before our eyes. As recently as 1992, only 36 percent of our survey respondents got a bonus of some sort. Year by year, that's been changing-and rapidly. In 1994, 42 percent reported a bonus; in '96, the figure rose to 49 percent of the sample; and this year, half our readers got a bonus in addition to their pay. The first half of the '90s traumatized American industry, as companies off-loaded thousands of workers to reduce costs. The second half of the '90s is traumatizing industry, too, as companies struggle to rebuild engineering staffs. One way to manage costs is by using reward-based compensation systems. You get bonuses in good times; none in bad. Base salaries move very little. Just under 14 percent of our sample work under a pay-for-performance compensation system, whereby their pay is partially or even completely determined by making some fixed goal. That's about the same as last year's figure. Harris Corp. (Melbourne, Fla.) has instituted such a pay system at some of its sites. A few of our bonus recipients were new-job holders. Of the 85 respondents who got new jobs in the past 12 months, 30 collected signing bonuses. While it's fairly common for vice presidents and chief engineers to receive an inducement to leave their jobs, signing bonuses are not restricted to executives. Nine senior engineers-half the number who reported landing a new job in the past 12 months-received bonuses. Fourteen engineers got $5,000 or more. Those lucky 14 possessed technical skills that drove up their value in the tight 1996-97 job market. Hot right now: deep-submicron, DSP and ASIC design. Altogether, 1 7 percent of the EEs and managers have received signing bonuses at some point in their careers, illustrating that such perks are not new recruitment techniques. Recruiters are noticing that employers are dusting offinducements not seen since the heyday of the '80s: housing allowances, relocation packages and jobs for spouses. More common are bonuses based on individual or team performance. There's the informal "nice job" bonus; the "team-made-its goal" bonus; and the corporatewide profit-sharing bonus, such as the one Intel Corp. doled out at the beginning of 1997 after a record year. In all cases, the bonuses are given out at the discretion of the company. In a fixed-salary arrangement, by contrast, the company must pay regardless of the profit situation. We can expect more bonuses in the future, but no one should expect instant gratitude. The Japanese engineers who responded to our survey in the Japanese publication Nikkei Electronics don't give their companies high marks for bonuses, even though the industry usually provides two a year (see Opinion chapter). So what components add up to a well-paid engineer in 1997? He or she has an MSEE; lives in Silicon Valley; works in the computer and peripherals industry; and supervises at least five people. For the first time this year, we have broken out salaries in six metropolitan areas. We chose "engineering hubs" where larger numbers of EEs and computer scientists might tend to congregate. The problem with dividing up responses by city is that the smaller you slice the pie, the narrower the sample. In two cases, we used medians instead of mean salaries because one individual had an extremely low salary (Portland, Ore.) or an extremely high one (Phoenix) that badly skewed the results. The list holds few surprises, confirming what is probably the general expectation about how salaries would rank by city. To the astonishment of no one, San Jose blows every other city out of the water in terms of pay scale, with a mea n salary of $85,200. As mentioned earlier, San Jose has the largest contingent of EEs and computer scientists in our Six Figure Club.
Other cities and their mean salaries:
By region, the pattern is much the same.
The Pacific, including all states from Washington to Southern California, topped the list at $78,800, followed by:
It would appear that our small sample of Austin respondents drove down that city's pay estimate below the region's average of $66,200.
That's OK. Dial up www.homefair.com/home/ , and click on "Salary Calculator." If you're earning $60,000 in Indianapolis, its equivalent in San Jose would be $101,200! The lesson? Don't be blinded by staggering dollar signs in considering a move. Chances are if you're young, renting and eyeing a career in chip design, you'll hire a U-haul and head west. If you own a four-bedroom home in Indianapolis and work on automotive electronics, you'll stay put. Of course, that calculator doesn't compare a February snowstorm in Indianapolis vs. a February 70 day in the Valley. Just as well. The calculation would probably crash your system. Even though respondents in computers and peripherals make up the largest industry group in the Six Figure Club, their mean salary of $74,400 wasn't the highest. A small group of medical-electronics engineers scored $75,500 mean, though only one of the 15 respondents was earning $100,000 or more.
Other tallies:
Yes, managers earn more, but whether it's worth the hassle is up to you. Design and development managers averaged $80,200, against $66,100 for design and development engineers. As you'd figure, the top-ranking executives did even better. Technical directors and vice presidents of engineering are very near to averaging $100,000 a year. The veeps' mean was $99,100, while the tech directors hit $97,600.
At a lower level, here are some mean salaries by job title. All showed increases over last year's earnings.
All of the above represent groups with more than 50 respondents. Considering that design engineers are at a lower end of the salary spectrum, their 8 percent pay rise over last year's $51,700 is impressive. Less so was the $1,200 increase for our software respondents, especially since everyone seems to be crying out for more of them.
Among those with fewer-and, consequently, shakier data-are:
No question about it: Going for that MS or PhD jacks up your pay rate, provided it's in engineering or i
t's an MBA.
But respondents who simply listed "MA/MS," presumably not in business administration, computer science or electrical engineering, barely outpaced our BSEEs.
This year's salary number for PhDs represents a comeback after last year, when those with doctorate degrees lagged behind MBAs in wages. For a while, PhDs were labeled "overqualified" and "too expensive" in the job market, as federal labs downsized and companies shelved some of their own research operations. However, PhDs are showing up in some lab startups, such as Sharp Labs in Camas, Wash.
The salary curve rises with experience, until we hit "25 years or more."
The biggest jump occurs after six years in the business-a $12,000 increase.
The age curve looks much the same:
Hitting your early 30s means a $15,000 boost for most of you, but after age 60, the picture looks bleaker. Remember that these comparisons measure only this group of respondents at this time. The 30-year-old EE probably will be earning much more than his 45-year-old counterpart some 15 years from now, barring drastic wage deflation. In 1986, a 30-year-old would have averaged $43,700. In 11 years, that age bracket's mean salary has risen $21,200. In fact, the EE who was 30 years old in 1986 is probably earning $71,600 today, on average.
This illustrates a point made in earlier surveys: At least among our readership, no evidence exists of immigrants dragging down overall salaries. Other studies, including one conducted by the University of California, Los Angeles, acknowledge that some immigrant groups start out lower tha n Americans, but gradually work their way up the wage scale. We suspect that EE Times tends to draw an educated, English-speaking group of immigrants; newcomers who may not be at home with the language are not as likely to be readers. And those newer immigrants are probably the most vulnerable to wage exploitation.
Our admittedly limited sample shows no such exploitation happening. Not a single one of the 137 non-U.S.-born engineers or managers earned
Of the 679 total survey respondents, 522 identified themselves as white (not necessarily American) and 152 as belonging to other ethnic groups. Clearly, these include people whose families have lived in the United States for two centuries as well as immigrants. Whites scored among the lowest wage earners, with average salaries $1,000 below the mean. To some extent, this may be attributed to the extremely wide range of salaries represented, from the eight people reporting incomes below $20,000 to the 39 above $100,000. No other group displayed such disparity.
Other mean salaries, by heritage:
These three groups had more than 10 respondents apiece. Among groups with fewer than 10 respondents:
This year's female respondents achieved virtual pay parity with their male counterparts: $67,000 vs. $67,300 for men. More comprehensive surveys of gender gaps in engineering have predicted that women engineers would catch up to men as they moved up the promotional ladder or remained in the engineering field.
Other related Salary graphics:
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nce the exclusive stomping ground of corporate executives, the $100,000-and-over Six Figure Club is opening its doors to more EEs and their families than ever before. Who's knocking on the door? Well, not the "average" engineer. Base salaries for U.S. respondents to the annual
EE Times
"Salary & Opinion Survey" rose to a new high-$67,400, well short of the entrance fee to the club. However, that figure provides only a ballpark estimate of what's really going on. Some 56 respondents reported salaries of $100,000 in 1997-8.4 percent of the sample, up from 6.6 percent last year. And they're not all executives or top corporate officers.When we asked respondents for total income-bonuses, overtime, second jobs, etc.-we added another 24 engineers to the Six Figure Club, nudging total membership to just under 11 percent of the sample. Indeed, bonuses are one reason that the club has grown. For the first time, more than half of our readers re
ported getting bonuses
But there's another way to crunch the numbers.
Broken down by job title, group leaders are happiest with their salaries, with 70 percent believing their wages are on a par with those of colleagues. Our largest pool, senior engineers, are content, at 54 percent.
Most recruiters confirm that engineers in the Deep South, upper Midwest and Ohio Valley don't earn as much as their counterparts in the Rockies, Pacific or Southwest.
Interestingly, computer-science grads fared better than those with EE degrees at both the master's and bachelor's level. However, we heard from about 140 more EE respondents in both areas, so the sample size for computer scientists isn't large.
Here's a twist: American-born engineers earned a mean salary of $66,000, fully $1,400 below the total mean. Immigrants from India ($74,400) and Hong Kong ($76,800) pulled up the averages for foreign-born engineers. Newcomers from China ($65,800) lagged behind them.
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