Firm expansions fuel opportunities for civil engineers and keep compensation growing.

Civil engineers, whose fortunes often rise and fall with the health of the construction industry, face mixed markets in the United States. While residential land development has slowed in many areas of the country, public projects and some non-residential construction sectors are thriving. Despite the mixed economic outlook, for many engineering firms—especially large, national and international companies—expansion is challenging human resource departments to keep pace. According to ZweigWhite’s 2007 AEC Business Trends Survey, conducted in September and October of 2006, 72 percent of firm leaders who responded reported that they would be increasing hiring and recruitment activities in 2007 and beyond. Finding qualified staff was rated the most important challenge for this year.

For example, Boise, Idaho-based Washington Group International, an international engineering, construction, and management company, launched a national recruiting campaign in March to hire more than 1,000 engineers, other professionals, and support staff. "We are seeing the strongest markets in our industry in at least 30 years," said Stephen Hanks, president and CEO.

In April, Overland Park, Kan.-based Black & Veatch announced that it expects to add 1,000 new professionals to its global workforce in 2007, following a 23-percent increase in employment in 2006. Also in April, Denver-based CH2M HILL said that it hired about 900 professionals during the first quarter of 2007 "to staff a growing number of water, transportation, environmental, and industrial projects worldwide." The firm plans to hire 7,000 professionals in 2007 and reported more than 1,200 open positions.

So other than enhanced job security and opportunities, what does the healthy hiring environment mean for civil engineers? According to respondents to CE News’ 9th Annual Salary Survey, their salaries overall are on a moderate but steady climb. During the past 12 months, 87 percent of private-sector respondents and 90 percent of public-sector respondents reported receiving a raise. Median pay raises for private-sector civil engineers ranged from 4 percent to 7 percent, depending on experience level, with the less-experienced and lower-paid employees generally receiving higher-percentage raises (see Table 1). Public-sector civil engineers’ median raises were 3 percent to 5 percent, also with less-experienced workers getting higher-percentage raises.

This continues the trend of mostly increasing salaries at all experience levels documented by CE News’ survey during the past four years (see Figure 1). In particular, civil engineers with 16 or more years of experience have fared well, with median salaries increasing by $9,000 to $15,000 (not including bonuses) since 2004. Table 2 (see Table 2) provides median salaries and bonuses reported by survey respondents according to position or title. Unfortunately, data is insufficient to break out median salary and bonus accurately by title and experience or by state (see "Survey method").

Only 71 percent of entry-level civil engineers (0 to 2 years of experience) reported receiving a raise during the past 12 months. However, this group includes respondents who have not completed their first year of employment and may just be approaching an initial salary review. According to the National Association of Colleges and Employers’ (NACE) latest survey, starting salary offers to spring 2007 college graduates with bachelor’s degrees in civil engineering average 4.8 percent greater than a year ago. Nationally, the average offer is $47,750, NACE said, which compares closely with the first quartile (Q1) salary reported by entry-level civil engineers responding to CE News’ survey (see Table 1).

Bonuses and benefits
For private-sector civil engineers, bonuses (or commissions) can be an important part of their total compensation. Survey respondents with more than 15 years of experience reported a median bonus approximately equal to 10 percent of median salary (see Table 1). Median bonuses for less-experienced respondents were closer to 5 percent of the corresponding median salary. Overall, 80 percent of private-sector respondents and 25 percent of public-sector respondents said they received a bonus or commission during the past 12 months. But not all bonuses are paid in cash. One project manager reported receiving an extra week of vacation in lieu of a bonus; a county engineer claimed "a 14-pound turkey" as a bonus.

Other components of total compensation are insurance, retirement, and other fringe benefits, which often are of equal or greater value than bonuses. Following are the percentages of respondents (private sector/public sector) whose employers offer each group insurance benefit:

• medical—98 percent/99 percent;
• dental—84 percent/91 percent;
• life—81 percent/88 percent;
• long-term disability—69 percent/61 percent;
• short-term disability—69 percent/52 percent; and
• vision—65 percent/78 percent.

In addition, the most popular retirement benefits offered by private-sector employers are 401(k) with a company match, profit sharing, employee stock ownership (ESOP), and stock options (see Table 3). Public-sector employers more frequently offer a retirement pension, deferred compensation, and 401(k) with match. Compared with last year’s survey, however, the 401(k) option is gaining popularity in the public sector, primarily at the expense of deferred compensation programs.

Also gaining popularity as fringe benefits (see Table 4) are paid professional registration—offered by 73 percent of respondents’ employers in the 2007 survey compared with 68 percent in 2006—and paid training—offered by 70 percent of employers in 2007, up from 62 percent in 2006. Other benefit offerings that an increasing proportion of respondents reported this year are tuition reimbursement, cell phone or phone allowance, flexible scheduling, subsidized or free parking, company car or car allowance, and telecommuting.

After factoring in bonuses and insurance, retirement, and other fringe benefits, most civil engineers responding to the survey are satisfied with the compensation they receive (see Figure 2). A slightly greater proportion of private-sector civil engineers reported being satisfied or very satisfied with their total compensation after 10 years on the job compared with their counterparts in the public sector; but a greater percentage of public-sector respondents expressed satisfaction late in their careers.

Interestingly, the proportion of self-employed respondents who indicated they are satisfied with their compensation (73 percent) is almost identical to that of employees of civil engineering firms, government agencies, or other companies (70 percent). The median salary in 2006 for self-employment respondents is slightly greater than for presidents/CEOs (see Table 2), but because self-employed civil engineers typically do not have a set salary, bonus, or raise, total compensation can be more variable year-to-year compared with civil engineers employed by larger firms. Self employment may provide some intangible benefits, but apparently in terms of self-employed people’s level of satisfaction with their salary and benefits, the grass isn’t much greener.

Factors that make a difference
The grass is significantly greener, however, for civil engineers who obtain a professional engineer (P.E.) registration. Survey respondents with a P.E. registration earned, on average, $15,000 to $20,000 more per year in total compensation than respondents without the P.E. designation (see Figure 3). It should be noted, however, that 83 percent of respondents reported obtaining P.E. registration, so the number of non-P.E. respondents is comparatively small. Consequently, data shown in Figure 3 is for civil engineers at all experience levels combined; data is insufficient to indicate the size of any immediate increase in salary that engineers—particularly those early in their careers—typically receive after obtaining P.E. registration.

A previous CE News Salary Survey article (June 2005), pointed out that higher levels of education pay dividends for civil engineers throughout their careers, but that the advantage of an advanced degree in terms of total compensation may be less than expected. In 2005, the difference in median compensation between respondents with bachelor’s degrees and those with master’s degrees averaged less than $5,000. The 2007 survey confirms the monetary advantage of an advanced degree throughout an engineer’s career (see Figure 4), with an even wider gap between holders of bachelor’s and master’s degrees. This year, median compensation (salary plus bonus, if any) of respondents with master’s degrees averages $8,000 more than respondents with only bachelor’s degrees.

Sixty-five percent of respondents to the CE News 2007 Salary Survey indicated that their highest completed level of education is a bachelor’s degree; 31 percent have completed a master’s degree; and 2 percent completed a doctorate degree. In addition, almost 5 percent of respondents said they have earned a master’s of business administration (MBA).

Sticking around
An amazing 19 percent of respondents with more than 30 years of experience in the industry have worked for most, if not all, of that time for the same company (see Table 5). Only 10 percent of respondents overall have changed employers within the past two years (including new civil engineering graduates just entering the workforce), but the data suggests that 40 percent of respondents with two to four years of experience have changed employers at least once. Firm expansions during 2007 and beyond could decrease the length of time civil engineers stay at one company as career opportunities increase.

Discussion about civil engineering job opportunities and salaries in the United States inevitably raises questions about the impact of the H-1B visa program for foreign technical workers and whether it should be expanded or further restricted. One survey question was intended to shed some light on the debate; however, only eight respondents (less than 1 percent of the total) indicated that they were foreign born and working in the United States on an H-1B visa. Almost 93 percent of respondents are natural-born U.S. citizens and almost 7 percent are naturalized U.S. citizens. Unfortunately, with such a small number of H-1B visa holders participating in the survey it is not possible to compare salary data meaningfully.

For now, CE News’ Annual Salary Survey suggests that, so far, U.S. civil engineers’ opportunities and fortunes have not been adversely impacted much, if at all, by foreign engineers working in the United States. While beyond the scope of this research, what is unknown is the effect on U.S. civil engineers’ opportunities and fortunes by offshore foreign workers doing civil engineering work for U.S.-based companies; this is a topic ripe for further exploration.

In summary, there is good news: Median salaries continue to increase, outpacing inflation, and benefit offerings continue to expand. Additionally, only a small percentage of survey respondents expressed dissatisfaction with their compensation.

Nevertheless, if finding qualified staff really is the most important challenge facing civil engineering firms, they cannot afford to rest on this favorable report.

Survey method
Invitations to participate in the CE News 9th Annual Salary Survey were e-mailed in February 2007 to more than 28,500 subscribers to Civil Connection (an e-mail newsletter that includes CE News and Structural Engineer subscribers, as well as others). Of the 7,824 e-mails that were opened (27 percent), 3,061 people launched the online survey. The survey remained open for two weeks, and during that time we received 2,242 completed records. For this analysis, we separated the data provided by civil engineers (52 percent of the responses) from the structural engineers’ data, which is reported in the June issue of Structural Engineer.

After cleaning up the civil engineering data, 1,135 responses were analyzed—755 from employees in the private sector and 380 from public-sector employees. Specifically, the data presented in this article represents full-time employees who responded positively to the statement, "I primarily engage in the civil engineering profession, which includes design, management, and construction of projects in disciplines such as, but not limited to, transportation engineering, utility engineering, land development, geotechnical engineering, environmental engineering, and/or land surveying."