Compensation pressures remain a challenge

Compensation insights

• Engineering salaries are on the rise, but mounting project demands, a reliance on performance-based pay and a shortage of junior talent raise tough questions about sustainability.
• How will firms balance compensation, workload and tech-driven shifts to attract the next generation of engineers?

The latest salary survey from Consulting-Specifying Engineer provides insight into the ever-changing compensation landscape for engineering professionals, reflecting both positive trends and critical challenges in the industry.

With an average base salary of $118,310 in 2023 — a 3.4% increase from 2022 — engineering professionals are seeing consistent income growth, though it’s worth examining if this growth rate truly matches the demands and complexities engineers are tackling. Notably, 84% of respondents saw a rise in total compensation last year, with 77% also receiving additional income from bonuses, profit sharing or stock shares.

This trend highlights the increasing reliance on variable pay tied to profitability and individual performance. But how sustainable is this model in a landscape of fluctuating project demands and evolving technology?

While base salaries have risen by nearly 20% since 2014, from $99,100 to today’s figure, nonsalary compensation has seen an even steeper climb — up by almost 90%. Is this shift toward performance and profit-based pay a double-edged sword?

Engineering roles are becoming increasingly intertwined with corporate performance, potentially incentivizing high productivity yet also placing added pressure on engineers to continually surpass previous project outcomes. Considering that the average engineer surveyed is 49 years old and manages around 26 projects annually, it’s clear that many professionals are dealing with high workloads. Will this model remain viable as these professionals near retirement age, especially given the existing shortage of junior team members to absorb some of the workload?

Beyond compensation, the survey’s findings reveal that the industry is grappling with big challenges, including shifting client expectations, shortened project timelines and cost-cutting pressures. One-quarter of survey participants cited communication issues with stakeholders — consultants, architects or others — as a core obstacle, underscoring the need for seamless collaboration across complex projects.

At the same time, many firms report difficulty in recruiting junior staff, highlighting a broader issue: a gap in the talent pipeline that could impact industry sustainability. This raises an important question for firms: How can they attract and retain new talent in an industry increasingly dominated by technology-driven roles and rising expectations?

Technological shifts are further reshaping the landscape, with nearly half of respondents expressing concerns over artificial intelligence replacing traditional decision-making roles. As energy efficiency and green building practices continue to gain traction, engineers are also seeing increased expectations around battery energy storage, energy consumption forecasting and sustainable practices. These areas will require more specialized knowledge and skills, further emphasizing the need for ongoing training and professional development. But as engineering becomes more tech-centric, how can companies ensure engineers’ roles remain both relevant and rewarding?

The path forward demands a delicate balance. To maintain a workforce of experienced, highly skilled professionals, firms must offer competitive salaries while addressing workload management and ensuring that younger engineers can see a clear and enticing career trajectory. As the industry contends with these challenges, the need for strong mentorship, effective collaboration and adaptive skill-building becomes critical.

Looking to the future, can engineering firms foster an environment that not only keeps pace with changing demands but also secures a steady influx of emerging talent? Or will the dual pressures of compensation variability and evolving technologies limit the industry’s growth and sustainability? The responses to these questions will shape the engineering profession’s next chapter, setting the tone for what it means to build, design and lead in a rapidly changing world.

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