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05.10

Employment Data Gives Cause for Optimism About Engineering Rebound

By Barton Reppert

Leaders of IEEE-USA’s Career and Workforce Policy Committee (CWPC) say they are cautiously optimistic about signs of recovery in American engineering labor markets, rebounding from the severe recession that has plagued the U.S. and world economies over the past two years.

The collapse of the subprime mortgage lending bubble in September 2007 marked the beginning of America’s (and the world’s) worst financial crisis since the Great Depression (Civilian unemployment reached 10.2 percent in October 2009). The subsequent failure of major financial institutions, automobile manufacturers and parts companies froze consumer demand and jobs creating investment across the economy.

However, according to data recently released by the Department of Labor’s Bureau of Labor Statistics, employment in three high-tech job categories — electrical and electronics engineers (EEs); software engineers; and computer scientists and systems analysts — returned to levels last seen in 2008.

Source: Department of Labor Bureau of Labor Statistics

For EEs, employment grew 7.8 percent from the fourth quarter of 2009 to the first quarter of 2010, and now stands 16.1 percent above its historical low in the first quarter of 2009. Software engineering was essentially unchanged quarter to quarter, but remains 5.3 percent above its first-quarter 2009 low. For computer scientists and system analysts, first quarter employment grew 4.7 percent and is now 14.5 percent above its second-quarter 2009 low, according to an IEEE-USA press issued on 27 April.

The release quoted IEEE-USA President Evelyn Hirt as commenting: “As we watch for signs of recovery, we think it’s important to focus on the employment numbers. Re-employed engineers, scientists and other technology professionals will help create more jobs and ratchet the economy forward.”

In an article published on 15 April, The Wall Street Journal reported that the technology industry “is accelerating its recovery from the recession with surging earnings that have spurred companies to sharply ramp up their hiring.”

It noted that Intel has disclosed plans for its first substantial hiring in five years — expecting to hire 1,000 to 2,000 people in 2010. Google hired 786 new employees in the first quarter of this year, while Cisco Systems Inc. has said it plans to hire between 2,000 and 3,000 workers, after adding 2,100 employees in the three months that ended on 23 January.

The Journal story quoted Andrew Bartels, an analyst at Forrester Research, as saying: “The tech recovery has started in the U.S. and around the world.” Bartels estimates the U.S. technology market will increase 8.4 percent this year to $550 billion, after shrinking 7.9 percent in 2009.

Volunteer leaders of IEEE-USA’s Career and Workforce Policy Committee — Hank Lindborg, Ed Perkins and Tarek Lahdhiri — described the Wall Street Journal article as “lending support for our own cautious optimism about signs of recovery in U.S. engineering labor markets.”

The CWPC’s mission is “to advance the career-related policy interests of electrical, electronics and computer engineers and related information technology professionals, with a specific focus on the career-related needs of IEEE’s U.S. members and the overall health of the U.S. engineering workforce. Its scope of activities includes both public and private sector policymaking that directly affects the education, credentialing, employment, utilization, compensation, training and retirement security of IEEE members and other scientific, engineering and technical professionals.”

During the worst of the recession, unemployment rates reached highs of 8.6 percent for EEs in the second quarter of 2009; 7.3 percent for computer scientists and systems analysts in the third quarter of 2009; and 5.5 percent for software engineers in the first quarter of 2010.

Source: Department of Labor Bureau of Labor Statistics

According to the CWPC, IEEE-USA’s Salary and Fringe Benefits Survey suggests that the annual unemployment rate for IEEE-USA members reached 2.0 percent in 2009. This compares with annual unemployment rates for all engineers (5.1 percent) and all EEs (6.4 percent), as reported by the Bureau of Labor Statistics in 2009.

The CWPC runs Career Survival Workshops as part of a continuing and concerted effort to inform and educate IEEE’s U.S. members about changing labor market conditions, current and projected employment opportunities as well as critical skills requirements that engineers need to successfully respond to such opportunities.”

CWPC members are currently converting the conventional face-to-face workshop delivery format to webinars to reach a wider audience, reduce costs and, hopefully, help participants maintain their employability. A new webinar on risk management opportunities for STEM [science, technology, engineering and mathematics] professionals is also under consideration.”

A separate, but related, Washington Post story on 21 April quoted the International Monetary Fund’s top economist as saying the world economy is rebounding from recession and will expand by more than 4 percent this year.

“A global depression has been averted,” said Olivier Blanchard, IMF economic counselor, as the agency released its latest World Economic Outlook. “The world economy is recovering and recovering better than we thought likely.”

According to the IMF, the U.S. economy is projected to grow by 3.1 percent, major European nations by a combined 1 percent, while China’s economy is projected to grow by remarkable 10 percent.

On 9 April, Newsweek reported that “the long-term decline of the U.S. economy has been greatly exaggerated. America is coming back stronger, better and faster than nearly anyone expected — and faster than most of its international rivals.”

“The Dow Jones industrial average is hovering near 11,000 — up 70 percent in the past 13 months, and auto sales in the first quarter were up 16 percent from 2009,” the Newsweek story said. “The economy added 162,000 jobs in March, including 17,000 in manufacturing. The dollar has gained strength, and the U.S. is back to its familiar position of lapping Europe and Japan in growth. Among large economies, only China, India and Brazil are growing more rapidly than the United States.”

Barton Reppert is an independent science and technology writer, mostly focusing on S&T policy issues. He previously worked for 18 years as a reporter and editor with The Associated Press in Washington, New York and Moscow

Comments may be submitted to todaysengineer@ieee.org.