By Debbie Fledderjohann, President, Top Echelon® Contracting, Inc.
A few years back, Healthcare became a red-hot industry within the recruiting profession, and although it’s cooled off just a bit since then, the need in Healthcare has remained both strong and steady. In some cases, recruiters have switched their niche, entering the realm of Healthcare and experiencing positive results.
So—what’s the next “red-hot industry”?
How about Engineering?
The domino effect
According to the Bureau of Labor Statistics, job growth across all Engineering disciplines should continue to grow at its current rate, which is 9% to 14%. There are approximately 1.4 million engineers employed in the United States at any given moment, and that number is expected to increase through at least the year 2014.
One of the major reasons for the future growth of the Engineering industry is the impending retirement of the Baby Boomer Generation. Okay, we all know that this retirement isn’t going to be as dramatic as it was once portrayed. After all, not everybody can afford to retire these days, and some of those who do may continue to work on a contract basis (more on this in a moment). But the sheer number of people who will shortly be of retirement age is so large that a shortage of workers—especially in Engineering—is inevitable.
According to Andrew Hammer of Career Marketplace, Inc., a network of vertically integrated employment centers focused on Engineering, many companies are coming to the stark realization that they’re not going to have enough experienced engineers in the near future.
“Engineering is in a steady-growth phase right now,” said Hammer. “The boom in engineering hiring is going to come as existing engineers retire. A lot of companies built a top layer and a bottom layer in their engineering departments, and they don’t have anything in between. So when the top layer retires, whether that’s this year, next year, or five years from now, they’ve got nothing coming behind them. As the Baby Boomers retire or transition to contract or consultant roles, it’s projected that there aren’t going to be enough experienced engineers to fill those positions. That’s where the boom is going to come from.”
Hammer anticipates a domino effect once the first wave of Baby Boomer engineers retires. Here’s how it will happen. Engineering departments, including managers and supervisors, will have to work harder and longer to compensate for the lost production of the initial retirees in order to meet the deadlines and goals set by upper management. Next, those engineers who are approaching retirement age are going to start thinking about their recently retired colleagues, who in many cases are continuing to work as well-paid contractors. It doesn’t take a slide-rule to determine their probable thought pattern.
“Other engineers who are still sitting there are going to say, ‘Wait a minute. You mean as a contractor, I can set my own hours, I can work for whoever I want to work for, I can choose to work only on interesting projects, I can choose my pay rate, I can have benefits coverage, and I can make more money that way than I can by staying on staff?’” said Hammer. “’I’m going to retire, too.’ This domino effect is a real possibility at both small companies and large companies. But when engineers retire, that knowledge is gone. It doesn’t matter if you’re General Electric or Bill’s Engineering Shop, it’s going to hurt.”
‘Going green’
There are three main fields in Engineering. They are electrical, mechanical, and chemical. However, there are other fields, as well, and it’s some of these that are (or soon will be) experiencing the greatest need.
“The hot industries right now are biomedical engineering and environmental engineering,” said Hammer. “They’re projected to stay hot for the foreseeable future. For example, instead of seeing just design and theoretical engineers in the biomedical arena, you’re starting to see production engineers and manufacturing engineers. The biomedical industry has to produce in larger quantities, so you’re seeing an actual production or manufacturing engineer who’s running the manufacturing line, as opposed to just a theoretical design engineer.”
There are specific reasons why companies are now seeking these types of engineers—and why they’ll continue to do so in the future. In the case of biomedical engineers, the reason is the aging population in the United States. This has created a focus on health-related issues and has also boosted the need for improved medical devices and equipment. The demand for environmental engineers is rooted in both legislation and a “green movement.” (You may have heard the new cultural catch-phrase, “going green.”) Laws that were passed a few years ago designed to regulate emission standards, testing, and safety are now beginning to take effect, and companies are striving to be pro-active about ensuring their compliance to these new, environmentally friendly measures. That includes hiring more engineers.
“Many companies are self-policing,” said Hammer. “They want to get ahead of the curve. They don’t want to find themselves redoing a factory to come in line with a new regulation. They’re looking at it as a good business decision because it’s absolutely cheaper to make changes now rather than later.”
Going soft
So—engineers are in demand. But which engineers are really in demand. In other words, which ones are the superstar candidates, the ones that stand head and shoulders above the rest? The ones that possess not only stellar math and science skills, but also excellent “soft skills,” or people skills.
“To be a truly successful engineer today and in the future, you have to be able to interact better,” said Hammer. “Engineers have to be able to work with their sales department and management, and they have to be able to explain concepts to a writer or to their Web designer.”
This means that recruiters who can find candidates with both hard skills and soft skills will be able to present a steady stream of MPCs (Most Placeable Candidates) to their client companies. These are the superstar candidates for which companies are earnestly looking, mainly because they’re more versatile, more flexible, and ultimately, more productive. As a result, they’ll have more of an impact on the company’s bottom line.
“The engineers who are moving quickly through the ranks are those who have the soft skills,” said Hammer. “If they don’t have those skills, it’s not that they’re not going to get hired. They’re still going to get a job, but they’re going to be stuck. They’re going to be sitting in their cubicle crunching numbers, while their counterparts with soft skills will earn more, and they’ll have more advancement opportunities. Soft skills have always been necessary, but with the coming shortage, engineers with better soft skills are going to advance more quickly. They’re going to be the people who, personality-wise, the company leadership will want to be future leaders.”
In addition to placing engineers with excellent soft skills in the biomedical and environmental fields, recruiters should also take advantage of retiree re-staffing, which has become increasingly popular during the last few years. According to a study by the American Association of Retired Persons (AARP), more than 60% of companies in the United States are bringing retirees back as contractors. The reason? Companies are discovering that they sorely miss the extensive knowledge, expertise, work ethic, and mentoring capabilities provided by more tenured workers.
“Retiring engineers have a skill set that they’ve developed only through experience,” said Hammer. “For companies to keep a project on track, those skills are going to be in demand. They are going to be seeking the retired engineers out to come back and fill that void. It’s impossible to replace a lot of the specific experience that’s sitting today in many engineering departments. The only thing that’s going to replace that is time.”
Positioning and preparation
Will Engineering eventually become as hot as Healthcare? Only time will tell. However, what you can do in the meantime is position yourself to take advantage of this impending boom in the Engineering industry. And the best way to do that is to offer both direct-hire and contract staffing services to your client companies.
With your direct-hire business, of course, you can place engineers in the biomedical and environmental engineering fields (preferably with great soft skills) on a full-time basis, to help fill the void created by those engineers who have retired. In addition, with your contract staffing services, you can place retirees on a contract assignment or consultative basis. In this fashion, you’ll be able to benefit from the boom in more than ways one way . . . and you’ll create more than one stream of revenue in the process.
In addition, by utilizing the contract staffing services provided by Top Echelon Contracting, the recruiter’s back-office solution, you don’t have to worry about any of the contracting paperwork. As the employer, TEC takes care of all the administrative, financial, and legal duties associated with making contract placements. That way, you can focus on what you do best and what you enjoy the most—recruiting, closing deals, and making placements.
Since 1992, Top Echelon Contracting has helped executive recruiters nationwide offer contract staffing services to their client companies in a wide range of industries, including Engineering. We have the experience and resources you need to increase your firm’s productivity, and ultimately, enhance its profitability.
You can learn more about important Engineering trends by visiting the Career Marketplace Web sites listed below:
For more information about placing Engineering candidates on a contract basis, including recent retirees, call (888) 627-3678 and then press “2” to speak with a contract administrator, or you can visit us online at www.TopEchelonContracting.com.
Debbie Fledderjohann is the President of Top Echelon Contracting, the recruiter’s back-office solution since 1992. As a contract staffing service provider, Top Echelon Contracting handles all of the full-service administrative details associated with being the legal W-2 employer, including employee paperwork, legal contracts, timesheet collection, payroll funding, payroll processing, state and federal tax withholding, employee benefits, workers’ compensation coverage, invoicing, collection of accounts receivables, background checks, etc. For more information, please call (888) 627-3678 and then press “2” to speak with a contract administrator, or you can send an email to info@TopEchelonContracting.com. To receive a free Contract Training Kit, click here. To sign up for TEC's free newsletter, Contracting Corner, click here.
(“Engineer Shortage a Big Opportunity for Recruiters” was first published in the August 2008 issue of The Fordyce Letter.)