April 2010

Conducted by

Methodology
An email survey was sent to subscribers of Design News during the month of April, 2010. Results of the study were tabulated by Research Results, an independent research firm. The survey evaluated compensation as well as job satisfaction: The following areas were studied:

Current salary and bonus and how that compares to a year ago Length of employment Engineering disciplines Level of job stress compared to previous year Reasons for job stress Impact of economy Level of supervisory and/or budgetary responsibility compared to previous year Average work hours weekly Level of satisfaction as a design engineer Reasons for job satisfaction and dissatisfaction Challenges of job Size of company Companys major product line

Results are based on 1,672 usable replies. At a 95% confidence level, results are accurate and projectable within a + or 2.8% margin of error.

April 2010 2

The Design Engineer

Average Salary: $89,597

Average # of years in current position: 9 years

Average Bonus: $9,025

Average Age: 49

Education: Degree in engineering, 75%

Average # of years as an engineer : 18 years

Average hours work per week: 46

Average # of years with present employer: 12 years

April 2010 3

Section I Salary and Compensation

April 2010 4

What is your current base annual salary for 2010?

(not including bonus, commissions, etc.)

$50,000 or less $50,000 - $59,999 $60,000 - $69,999 $70,000 - $79,000 $80,000 - $89,999 $90,000 - $99,999 $100,000 - $109,999 $110,000 - $119,999 $120,000 - $129,000 $130,000 - $149,000 $150,000 or more 5% 4% 6% 7%

8% 9% 11% 13% 15% 11% 11%

Average Salary: $89,597 Median Salary: $85,000

April 2010 5

How does your base annual salary compare with 2009?

If your base salary changed over the past 12 months, by how much?
Less than 2% increase 2-4% increase 5-7% increase 8-10% increase Over 10% increase 4% 28% 6% 2% 1%

Increased 40%

Average Salary Increase: 4% Median Salary Increase: 3%

Stayed the same 51%

Decreased 9%

Less than 4% decrease 5-7% decrease

1%

1%

8-10% decrease Over 10% decrease

2%
Average Salary Decrease: 24% Median Salary Decrease: 10%

4%

April 2010 6

How much will you earn in bonuses, commissions, etc.?

(not including base salary in 2010)

Over $50,000 $9,000 - $49,999 $7,000 - $8,999 $5,000 - $6,999 $3,000 - $4,999 $1,000 - $2,999 Less than $1,000 No bonus/commission

4% 16% 4% 7% 5% 10% 2% 51%

Average Expected Bonus: $9,025

April 2010 7

How does your bonus, commission, etc. plan compare with 2009?

If your bonus, commission, etc. plan increased/ decreased compared to 2009, how much?
Less than 2% increase 2-4% increase 7% 16% 12% 13% 51%

Average Increase in bonus: 36% Median Increase in bonus: 14%

Increased 13%

5-7% increase 8-10% increase

Stayed the same 72%

Over 10% increase

Decreased 15%

Less than 2% decrease 2-4% decrease 5-7% decrease 8-10% decrease Over 10% decrease

3% 8% 7% 8%

Average Decrease in bonus: 51% Median Decrease in bonus: 50%

74%

April 2010 8

Section II Careers in Engineering

April 2010 9

How long have you been an engineer?

Which is your primary engineering discipline?

(i.e. mechanical or electrical design)

Less than 5 years

7%

Average years: 18 Mechanical engineering Electrical/electronics engineering Manufacturing engineering Electromechanical engineering

% of respondents

38% 26% 10% 6% 4% 4% 2% 9%

6 - 10 years

9%

11 - 15 years

13%

Software engineering Controls engineering

16 - 20 years 14%

Materials engineering Other

Over 20 years

58%

April 2010 10

How many years have you worked in your present position?

How many years have you worked in your present company?

Less than 3 years 16%

Average years: 9

Less than 1 year 1-9 years 10-14 years

1% 48% 16% 11% 9% 6% 5% 4%

3-5 years 14%

10 + years 51%

15-19 years 20-24 years 25-29 years 30-34 years

5-10 years 19%

35+ years

Average years: 12

April 2010 11

In an average week, how many hours do you work?

How has the number of hours you work each week changed over the past year?

Under 40 hours

6%

Work more hours 22%

44%

40-44

45-49

28%

50-54

12%

Same # of hours 66%

Work less hours 12%

55-59

6%

60 hours or more

5%

Average hours: 46

April 2010 12

Do you have supervisory and/or budget responsibility?

If you are supervising people, how has this changed during the past 2 years?

Both Supervisory/ Budget 28% Budgetary Only 8% Neither 49%

100%

Less people 32%

Same 44%
50%

More people 23%

Only supervisory 15%

0%

April 2010 13

What is the number of employees that you are supervising today and what is the number of employees you supervised two years ago?

52%

Average number of employees supervised in 2010: 15 Average number of employees supervised 2 years ago: 11

40%
Number of employees supervised in 2010 Number of employees supervised 2 years ago

24% 24% 16% 13% 10% 3% 8% 6% 1% 2%

None

Fewer than 5

5 to 9

10 to 19

20 to 49

50 or more

April 2010 14

Please rate your level of agreement with the statements below pertaining to your role as an engineer.

Strongly Agree/Agree

Neutral

Disagree/Strongly Disagree

Appreciated and respected

63%

19%

18%

Role of the engineer is a respected profession

59%

24%

17%

Underpaid and overworked

49%

33%

18%

Fully using engineering skills

44%

26%

30%

Role that is too often outsourced to China and/or other contries

44%

31%

25%

April 2010 15

Section III Job Satisfaction

April 2010 16

In general, how satisfied are you with your career in design engineering?

politics, politics, politics

bad management blaming engineering for bad management decisions

Not At All Satisfied 2% Not Very Satisfied 11%

Extremely Satisfied 10%

51% are Extremely/Very

satisfied with their design engineering career

I feel well respected in a field that is in demand (medical)

competing with offshore manufacturers

Very Satisfied 41%

Freedom to design

We keep outsourcing jobs without recognizing the value of the employees we let go compared to the mercenary attitude of consultants

Making a contribution
Somewhat Satisfied 36%

Sense of accomplishment

Contribution to the future of energy production

The industry is so volatile and the economy has not fully recovered from the recession yet, so another dip could mean more job losses April 2010 17

What factors contribute to being satisfied with your job?

Technical challenges Problem solving Opportunity to be creative Salary Location Opportunity for new challenges Relationships with colleagues Benefits Variety of projects Job security Recognition from peers Companys financial stability Recognition from management Relationship with boss Company size Relationships with subordinates Advancement opportunities Opportunity for job training Travel Managing people

% of respondents

What factors greatly impact on your dissatisfaction with your current job?
Company politics No room for advancement No recognition Salary Stress level too high Workload Not challenging enough Outsourcing Company unstable Lack of benefits Lack of adequate technology Colleagues Location Other

% of respondents

75% 75% 67% 57% 56% 56% 55% 54% 54% 48% 44% 43% 41% 35% 28% 28% 28% 21% 18% 12% 3%

73% 68% 61% 59% 53% 50% 37% 37% 33% 31% 29% 21% 12% 14%

Base: Not Very/Not At All satisfied with career in design engineering

Other Base: Extremely/Somewhat satisfied with career in design engineering

April 2010 18

What factors do you find most challenging?

% of respondents

How challenging is your job?

47% Extremely/Very
Not At All Challenging 2% Not Very Challenging 10% Extremely Challenging 8%
Challenging

Workload Balancing work with home/ personal life Keeping up with technology Company downsizing Lack of career development Working with outdated equip./technology Company stability Need to learn more skill sets

48% 42% 38% 32% 29% 28% 26% 24% 17% 16% 10% 10%

Very Challenging 39%

Global design teams Work conditions Poor relationships with co-workers Other
Base: Find job Extremely/Very/Somewhat challenging

How stressful is your job compared to two years ago?

More responsibility. More stress. The work atmosphere is: If you cant do your job the way we want it, we will get someone else and you can start looking for another one, that is if you can find one.

Somewhat Challenging 41%

51%

40%

9%

More

Same amount

Less

April 2010 19

How concerned or secure do you feel about your job in the current economic climate?
The economy is not recovering and there are less and less engineering opportunities due to outsourcing and lack of manufacturing jobs

Management attitude towards engineering, they Not Very seem to think they can assign Concerned work with less than 23% appropriate time and resources and it will magically happen. Lack of company respect and integrity.

Not At All Concerned 6%

Extremely Concerned 11%

29% are Extremely/Very

Concerned with the security of their position

Very Concerned 18% Somewhat Concerned 42%

The religion of outsourcing is a false one and is impacting everything in our world from competitiveness to ability to produce. Outsourcing has killed many jobs.

Engineering is the one thing that helps drive this company forward. We have enough projects to keep busy during slow periods.

The company has had to shed jobs recently, and this happened because there have been delays in contracts and some contract cancellations.

April 2010 20

Why do you feel this way about your job security? Show More Concern Over Job Security
The Economy
(N=106) No company or position seems to be completely safe during the recession, and global competition continues to create pressure. The economy is not picking up fast enough, which affects the bottom end of the company and therefore my chances of growth. Retention of personnel is always based on available funding and funding in very insecure in the present economy. I work for a small company, in a down economy it is very easy for a small company to go under.

Outsourcing

(N=101)

The global economy puts pressure on even the most stable companies/organizations. Competing with growing economies like those of China and India means Americans standard of living (unsustainable in many cases) will diminish even as others rise. Outsourcing our work to India or China, even though they do substandard work, but its cheap. Governmental regulations that are pushing business offshore. Outsourcing to India and China is eliminating engineering opportunities within the U.S. My company is constantly moving jobs overseas with NO notice. Staff assuming responsibility overseas lack adequate job skills and training and often fails at simple tasks, which calls for extraordinary efforts on our part. Additional effort is not appreciated nor seen as a value.

Company Downsizing/Layoffs

(N=46)

Due to rising cost of goods and materials, companies will downsize to reduce their expenses. 30% layoffs in this company; from 2,000 to 450 in 5 years. Constant layoffs and outsourcing. Very few other opportunities to move into.

Government/Politics

(N=33)

Current administration and congressional policies will severely undermine U.S. economic stability. Government is spending money they dont have. Probable increased taxes and inflation. Government needs to bail out private industry and stop allowing outsourcing of our engineering jobs. Shift in the political philosophy from capitalistic republic to a socialist republic on the part of the U.S. Government.

April 2010 21

Why do you feel this way about your job security? Show Less Concern Over Job Security
Companies are Stable
(N=44)

My company has weathered the current financial situation quite well. Our business has continued to prosper. EPA regulations insure continued requirements for product development. Business is good again. Even during downtime last year, upper management knew they had to hang on to the talented people they had, or suffer loss. Our company seems to be in a good place financially and is in a market sector that is less affected my market downturns. Business opportunities are on the upswing. Roll is key part of value offering we make to our customers. Experience is valued.

Unique/Experienced Skill Set (N=30)

My specialty is in high demand and my experience and abilities are understood to be key to the companys success. I have a unique knowledge of a niche product. I have knowledge and mentoring skills that are needed to sustain the companys product.

Retired/Retiring Soon (N=18)

I will retire if job status changes negatively. I can retire any time with 35+ years of service. Still a high need for materials engineers. Some older design engineers are close to retirement which means more opportunities for younger engineers.

April 2010 22

Has your company experienced any of the following during the last 12 months?

What percent of your engineering workforce was reduced?

Average % of workforce reduction: 21%

Layoffs/downsized during the last 6 months

100%

41%

60% + 7%
90% 80%

40 - 59% 11% 30 - 39% 8% 20 29% 19%

Hiring freeze

25%

70% 60% 50%

Hiring/Adding personnel

10 19% 29%

23%

40% 30% 20%

1 9% 26%

Other

11%

10% 0%

April 2010 23

How did this downsizing affect your position? How did your responsibilities change?
Our group lost a larger percentage and we now have more work with fewer people. More work from less qualified people and expected to do it in the same amount of time. Details handed off from those leaving always need lots of information than what was in the file. More work and travel for the same compensation. I worry that I will be the next on the chopping block. I now have the work of two former employees; I have to triage my work to determine what gets done the details get overlooked because I dont have the time! I am doing less of the engineering work I want to do and more of the simple tasks. Everyone has a lot more work to do, although team cohesion and efficiency have improved.

Unemployed 7%

Increased workload/ responsibility with less time/ pay 38%

No change 33% Other changes 22%

Lack of growth opportunities within the company. Demoted from a supervisor roll to project engineering. Projects delayed. Morale dropped for a time. For me it had a positive effect. I was promoted. Work was transitioned over to China and my responsibilities were reduced. Less work = less people = more job security concern. More focus on current products and less on advanced design. Insufficient staff and resources to properly support my projects, leading to schedule delays, cut corners, and product performance issues.

April 2010 24

Which of the following have you experienced in the last 12 months?

Over the next 12-18 months, will your company be..?

No raise in 2009 Reduction in benefits package No bonus

69%

43%

Layoff design engineers 9%

Other 7% Keep the same # of design engineers 48%

40%

Outsource design work 14%

Asked to take a pay cut

21%

Increased time off

18%
Hire more design engineers 22%

Laid off

8%

Other

12%

April 2010 25

How actively are you seeking another job?

Which approach(es) are you taking to look for a new job?

Actively 10%

Word of mouth/Peers/Colleagues Job Search websites 33%

64%

Passively 19%

I'm always open to better opportunities 43%

Contact with peers through social networking sites Search firms/Headhunters Contacting vendors/suppliers Attend job fairs 5% 15%

28%

LinkedIn (N=232)
26%

Facebook (N=15)

I'm happy where I am 28%

Other

16%
N= number of mentions

April 2010 26

Would you recommend this field to your son, daughter or to a friend?

Yes 70%

No 30%

April 2010 27

Section IV Demographics

April 2010 28

How many people does your company employ and how many work as engineers?

Average number of people employed at a company: 690 Average number of engineers employed at a company: 393
Number of Employees Number of Engineers

55% 44%

24% 17%

25%

21% 6% 7%

< 100

101 -500

501 - 999

> 1,000

April 2010 29

What is your companys major product line?

% of respondents

Automotive Medical Aerospace Defense Systems Industrial Controls Communication Systems Instruments/Test Equipment Consumer Electronics Contract Manufacturing Semiconductors Computers/Peripherals Electronic Components Machine Tools Other

9% 9% 9% 6% 6% 5% 4% 3% 3% 3% 3% 2% 2% 36%

April 2010 30

In which region do you work?

(Average salaries for each region are shown)

Pacific NW
(WA,OR)

New England
(ME, NH, VT, MA, RI, CT)

3% $82,593

Mountain
(MT, ID, UT, WY, CO, NM)

Midwest
(MI, OH, KY, TN, IN, WI, IL, IA, MO, ND, SD, NE, KS)

7% $98,590 Mid-Atlantic
(NY, PA, NJ, DE, MD, WV, VA, D.C.)

Southwest
(CA, NV, AZ)

4% $96,524

36% $82,740

13% $106,756 South

(AL, MS, AR, LA, OK, TX)

14% $91,403

Southeast
(NC, SC, GA, FL)

9% $96,204

7% $86,746

April 2010 31

Please indicate your educational background.

Bachelors degree in engineering Masters degree in engineering Two-year Associates degree in techincal field Masters in business administration Bachelors in non-engineering field Advanced degree in nonengineering field Ph.D in engineering Current student

What is your age group?

Average age: 49

61% 21% 17% 7% 6% 4% 3% 2%

35 - 44 21% 45 - 54 37%

55 - 64 28%

18 - 25 1% 26 - 34 8%

65+ 5%

Other No college degree

6% 6%

April 2010 32

Section V Salary Performance vs. Metrics

April 2010 33

Total Average Compensation

(Salary + Bonus)

Company Size (Number of Employees)

Bonus, commission, etc. Base salary

$11,164 $6,410 $7,428 $10,324

$101,688 $75,509 $82,962 $82,503

<100

101-500

501-999

1,000+

April 2010 34

Total Average Compensation

(Salary + Bonus) Age
Bonus, commission, etc. Base salary

$11,876 $6,986 $5,820 $1,485 $82,807 $92,807

$8,465 $6,617

$96,679

$90,571

$72,707 $55,841

18-25**

26-34

35-44

45-54

55-64

65+

**Small base size, interpret with caution

April 2010 35

Total Average Compensation

(Salary + Bonus) Level of Education
Bonus, commission, etc. Base salary

$15,525 $8,502 $7,142 $5,734 $100,938 $92,756

$87,770 $70,135

Masters/PhD degree in engineering

Bachelors degree in engineering

Bachelors or Advanced Two-year Associates degree in nondegree in a technical engr/Masters in BA field

April 2010 36

Total Average Compensation

(Salary + Bonus)

Number of Hours Worked

Bonus, commission, etc. Base salary

$12,466 $8,068 $8,408 $6,671

$105,401 $75,399 $86,050

$97,303

<40

40-49

50-59

60+

April 2010 37

Total Average Compensation

(Salary + Bonus)

Number of Years at Present Job

Bonus, commission, etc. Base salary

$11,499 $7,366 $7,744 $6,561 $12,519

$13,091 $12,227

$83,903

$88,860

$91,334

$88,166

$95,551

$93,388

$99,652

<5

5 to 9

10 to 14

15 to 19

20 to 24

25 to 29

30+

April 2010 38

Total Average Compensation

(Salary + Bonus)

Satisfaction with job

Bonus, commission, etc. Base salary

$11,000

$7,556

$5,534

$92,148

$87,930

$83,900

Extremely/Very Satisfied

Somewhat Satisfied

Not Very/Not at all Satisfied

April 2010 39

Total Average Compensation

(Salary + Bonus)

Seeking another job

Bonus, commission, etc. Base salary

$11,784

$8,137

$8,464

$5,788

$92,210

$90,171

$87,990

$87,733

I'm happy where I am

Passively

I'm always open to better opportunities

Actively

April 2010 40

Total Average Compensation

(Salary + Bonus) Number of Years of Experience
Bonus, commission, etc. Base salary

$9,789 $11,241 $4,705 $4,238 $76,235 $56,641 $79,811 $86,614 $98,498 $8,440

<5

6 to 10

11 to 15

16 to 20

> 20

April 2010 41

Total Average Compensation

(Salary + Bonus)

Job Discipline (Engineering)

Bonus, commission, etc. Base Salary

$9,725 $8,361

$10,934 $8,584 $8,704 $8,601 $6,503

$117,483 $96,847 $93,095 $88,281 $84,445 $82,934 $76,746

Software

Materials**

Electrical/ electronics

Mechanical

Electromechanical

Controls

Manufacturing

**Small base size, interpret with caution

April 2010 42

Total Average Compensation

(Salary + Bonus) Region
South West Moutain South New England Mid-Atlantic South East Pacific NW Midwest
$106,756 $9,898 Base Salary Bonus, commission, etc.

$96,524

$17,413

$94,204

$12,366

$98,590

$6,762

$91,403

$6,862

$86,746

$7,790

$82,593

$9,268

$82,740

$8,374

April 2010 43

Total Average Compensation

(Salary + Bonus) Industry
Computer/Peripheral (N=46) Semiconductor (N=50) Communication System (N=81) Aerospace (N=143) Defense System (N=105) Industrial Control (N=91) Medical (N=147) Consumer Electronic (N=52) Automotive (N=151) Instrument/Test Equip. (N=57) Machine Tools (N=31) Contract Mfg (N=48) $106,210 $106,077 $99,069 $99,852 $98,895 $92,657 $89,975 $84,248 $82,523 $77,792 $72,503 $70,949 $10,489 $9,334 $10,835 $8,706 $3,578 $16,286 $8,819 $8,402 $4,428 $5,637 $4,828 $4,427 Base Salary Bonus, commission, etc.

April 2010 44