The Engineering Profession Eighth Edition 2011

8/2/2019 The Engineering Profession Eighth Edition 2011

1/88

THE ENGINEERING PROFESSION

A Statistical Overview, Eighth Edition, 2011


2/88

Andre Kaspura

THE ENGINEERING PROFESSION

A Statistical Overview, Eighth Edition, 2011


3/88

THE Engineering Profession: A Statistical Overview, Eighth Edition, 2011

ISBN 978 0 85825 894 5Author: Andre Kaspura Institution of Engineers Australia 2011

All rights reserved. Other than brief extracts, no part of this publication may be reproduced inany form without the written consent of the publisher. The report can be downloaded atwww.engineersaustralia.org.au

National and International PolicyEngineers Australia11 National Circuit, Barton ACT 2600Tel: 02 6270 6555Email: [email protected]


4/88

i

CONTENTS

Chapter 1 Introduction1.1. Purpose of the Statistical Overview 11.2. The Engineering Profession 11.3. Statistical Consistency 21.4. Outline of the Overview 3

Chapter 2 The Structure and Characteristics of Engineering in AustraliaKey Points 62.1. Cross section and time series statistics 62.2. The engineering labour force 72.3. Employment in engineering 82.4. Immigration and the engineering labour force 92.5. Industry distributions and engineering specialisations 112.6. Age and age structure 16

Chapter 3 How has the engineering labour force changed over time?Key Points 20

3.1. Introduction 203.2. Trends in the engineering labour force 223.3. Employment in engineering occupations 253.4. The influence of immigration 25

Chapter 4 Transition from school to engineering educationKey Points 274.1. Introduction 274.2. Enabling studies in high school 284.3. Transition from school to university engineering 30

Chapter 5 University education of engineers

Key Points 355.1. Introduction 365.2. University commencements 365.3. Enrolments in engineering courses 395.4. Completions of engineering courses 425.5. The relative size of engineering completions 42

Chapter 6 Entry level graduationsKey Points 466.1. Introduction 466.2. Engineering technologists 476.3. Professional engineers 486.4. Engineering associates 516.5. An overview of entry level growth 53

Chapter 7 Skilled migrationKey Points 557.1. Skilled migration and the recognition of engineering qualifications 557.2. Changes to migration policies 567.3. Administrative changes 587.4. Permanent migration 587.5. Temporary migration 597.6. Migration and the flow of new graduates 59


5/88

ii

Chapter 8 Some characteristics of engineersKey Points 608.1. Introduction 608.2. Engineering responsibility levels 618.3. Age of engineers 618.4. Work experience 648.5. Salary packages 66

Chapter 9 The supply and demand for engineersKey Points 719.1. Skill shortages and labour market changes 719.2. Skill shortages and recruiting difficulties 74


6/88

iii

TABLES

Chapter 2Table 2.1 The engineering labour force in Australia, 2006 census 7Table 2.2 The engineering labour force in Australia by country of origin 10Table 2.3 The overseas born engineering labour force, time of arrival in Australia 10Table 2.4 Engineering specialisations and employment industries, males 13

Table 2.5 Engineering specialisations and employment industries, females 14Table 2.6 Engineering specialisations and employment industries, persons 15Table 2.7 The age structure of the engineering labour force, 2006 census 17Table 2.8 The age structure for non-engineering skills, 2006 census 17Table 2.9 Labour force shares, selected age groups, engineering and

non-engineering skills 18

Chapter 3Table 3.1 The engineering labour force 22Table 3.2 Comparing labour force participation and unemployment rates

for the engineering, skilled non-engineering and Australian labour forces 24Table 3.3 The engineering labour force employed in engineering occupations 25

Table 3.4 The employed engineering labour force by country of origin 25

Chapter 4Table 4.1 Year 12 participation in mathematics 28Table 4.2 Year 12 science participation 29

Chapter 5

Table 5.1 Domestic students commencing courses in engineering andrelated technologies 37

Table 5.2 Overseas students commencing courses in engineering andrelated technologies 37

Table 5.3 Students commencing courses in engineering and relatedtechnology, by country of origin 38

Table 5.4 Students commencing courses in engineering and relatedtechnology, by gender 38

Table 5.5 Domestic students enrolled in engineering and relatedtechnology courses 40

Table 5.6 Overseas students enrolled in engineering and relatedtechnology courses 40

Table 5.7 Students enrolled in engineering and related technologycourses, by country of origin 40

Table 5.8 Students enrolled in engineering and related technologycourses, by gender 41

Table 5.9 Domestic students completing courses in engineering andrelated technology 43

Table 5.10 Overseas students completing courses in engineering andrelated technology 43

Table 5.11 Students completing courses in engineering and relatedtechnology, by country of origin 44

Table 5.12 Students completing courses in engineering and relatedtechnology, by gender 44


7/88

iv

Chapter 6Table 6.1 Domestic students completing three year bachelors courses

in engineering 48Table 6.2 Domestic students completing four year bachelors courses

in engineering 49Table 6.3 Domestic students completing four year bachelors double degrees

in engineering 49Table 6.4 Domestic students completing four year bachelors degrees, including

double degrees, in engineering 50Table 6.5 Completion of diplomas and advanced diplomas in engineering

from TAFE colleges 52Table 6.6 Completion of diplomas and advanced diplomas in engineering

from universities 52Table 6.7 Completion of all engineering associate qualifications from universities

and TAFE colleges 53Table 6.8 The flow of new domestic graduates in engineering from

educational institutions 53

Chapter 7Table 7.1 Immigration of engineers 58

Chapter 8Table 8.1 The average ages of private sector engineers 62Table 8.2 The average ages of public sector engineers 62Table 8.3 The overall average ages of engineers 63Table 8.4 Average years of work experience of engineers in the public sector 65Table 8.5 Average years of work experience of engineers in the private sector 65Table 8.6 Average salary packages for engineers in the public sector 67Table 8.7 Average salary packages for engineers in the private sector 67

Chapter 9

Table 9.1 The engineering labour force, geographic distribution of key parameters 73Table 9.2 Unemployment rates for engineering specialisations in the census 74Table 9.3 Difficulties experienced recruiting engineers 77Table 9.4 The consequences of difficulties recruiting engineers 77


8/88

v

FIGURES

Chapter 2Figure 2.1 The industry distribution of the employed engineering labour

force, 2006 census 11Figure 2.2 The distribution of the employed engineering labour force

by engineering specialisations, 2006 census 11

Figure 2.3 The age structure of the engineering labour force, 2006 census 17Figure 2.4 The age structure of non-engineering skills groups, 2006 census 18

Chapter 3Figure 3.1 Relative growth in the engineering, non-engineering skilled and

Australian labour supply 22Figure 3.2 Engineering labour force participation compared to non-engineering

Skills and all labour in the Australian economy 23Figure 3.3 Growth in the demand for engineers, non-engineering skilled labour

and total labour in Australia 24Figure 3.4 Trends in unemployment rates for engineering, non-engineering

skills and the overall Australian labour market 24

Figure 3.3 The proportion of overseas born individuals employed in the engineering,non-engineering skills and in overall employment 26

Chapter 4Figure 4.1 Year 12 participation in mathematics 29Figure 4.2 Year 12 participation in physics and chemistry 30Figure 4.3 Engineering university applications, offers and acceptances 31Figure 4.4 Applications for university engineering courses compared to

non-engineering courses 32Figure 4.5 Acceptances of offers for university engineering courses compared to

non-engineering courses 32Figure 4.6 The TES profile for acceptances in engineering and related technology

courses compared to non-engineering courses 33Figure 4.7 The TES profile for acceptances in engineering and related technology

courses in 2009 and 2010 33Figure 4.8 The female share of acceptances by students with TES over 90,

2008 to 2010 34

Chapter 5Figure 5.1 Domestic completions in selected engineering courses compared to

corresponding completions in all disciplines 45Figure 5.2 Overseas completions in selected engineering courses compared to

corresponding completions in all disciplines 45

Chapter 6Figure 6.1 Female shares of new graduates, engineering team 54

Chapter 7Figure 7.1 Immigration of skilled engineers and the flow of new graduates 59

Chapter 8Figure 8.1 The average age of private sector engineers by responsibility level 62Figure 8.2 The average age of public sector engineers by responsibility level 63Figure 8.3 The average ages of Australian engineers 64Figure 8.4 Average years of work experience of engineers in the public sector 65

Figure 8.5 Average years of work experience of engineers in the private sector 66Figure 8.6 Relative growth in engineer level 1 salary packages and total earnings 68


9/88

vi

Figure 8.7 Relative growth in engineer level 2 salary packages and total earnings 68Figure 8.8 Relative growth in engineer level 3 salary packages and total earnings 68Figure 8.9 Relative growth in engineer level 4 salary packages and total earnings 69Figure 8.10 Relative growth in engineer level 5 salary packages and total earnings 69Figure 8.11 Relative growth in salary packages for engineers above level 5

and total earnings 70

Chapter 9Figure 9.1 The proportion of respondents that experienced difficulties recruiting

engineers in the past 12 months 75Figure 9.2 Engineering specialisations and difficulties recruiting engineers 75Figure 9.3 Engineering levels and difficulties recruiting engineers 76Figure 9.4 Location and difficulties experienced recruiting engineers 76


10/88

1. INTRODUCTION

The Purpose of the Statistical Overview 1

1.1 Purpose of the statistical overview

Engineers and engineering have been vital contributors to Australias prosperity and lifestyle.In the future, engineers will be called upon to help resolve water shortages, to improve thequality and environmental integrity of the built environment, to assist adaptation to Australiaschanging climate and to implement the energy, transport and industrial changes necessaryfor climate change mitigation. One of the functions of Engineers Australia is to advocate forchanges that improve engineering and the engineering profession in Australia and statisticson the size, structure and characteristics of the engineering profession in Australia are vital todischarge this function. In Australia, availability of occupational statistics is fragmented at thebest of times and often the definitions and concepts applied do not line up with professionalrequirements in engineering. This Statistical Overview aims to cut through these difficultiesby assembling a range of statistics from a variety of official and other sources to assist policyanalysis, development and planning on matters involving engineering.

1.2 The engineering profession

Engineers Australia is the peak body for the engineering profession in Australia. Theengineering profession comprises occupations, vocations and careers in which specialisedscientific and engineering knowledge is directed to useful and economical ends1 to meetsocial, economic and environmental objectives. The activities of the profession involvepeople, money, materials, machines and energy in combinations that are infinitely variable 2.

Engineers Australia requires engineers to have formal educational qualifications inengineering and to under-take life time professional development. Individuals who satisfy

Engineers Australias educational and professional development requirements are acceptedas members of the engineering team. The engineering team comprises the following threegroups:

Professional Engineers apply lifelong learning, critical perception and engineeringjudgment to the performance of engineering services. Professional Engineerschallenge current thinking and conceptualise alternative approaches, often engagingin research and development of new engineering principles, technologies andmaterials. Professional Engineers apply their analytical skills and well developedgrasp of scientific principles and engineering theory to design original and novelsolutions to complex problems. Professional Engineers exercise a disciplined andsystematic approach to innovation and creativity, comprehension of risks and benefitsand use informed professional judgment to select optimal solutions and to justify anddefend these selections to clients, colleagues and the community. ProfessionalEngineers require at least the equivalent of the competencies in a four year bachelorsdegrees in engineering.

Engineering Technologists exercise ingenuity, originality and understanding inadapting and applying technologies, developing related new technologies or applyingscientific knowledge within their specialised environment. The education, expertiseand analytical skills of Engineering Technologists equip them with a robustunderstanding of the theoretical and practical application of engineering and technicalprinciples. Within their specialisation, Engineering Technologists contribute to theimprovement of standards and codes of practise and the adaptation of established.

1 Adapted from Joseph W Barker, McGraw Hill Dictionary of Scientific and Technical Terms, 2nd Ed, New York,1993, pp409-102

Op cit


11/88

THE ENGINEERING PROFESSION: A Statistical Overview, Eighth Edition, 2011

Statistical Consistency 2

technologies to new situations. Engineering Technologists require at least theequivalent of the competencies in a three year bachelors degree in engineering.

Engineering Associates apply detailed knowledge of standards and codes of practiceto selecting, specifying, installing, commissioning, monitoring, maintaining, repairingand modifying complex assets such as structures, plant, equipment, components andsystems. The education, training and experience of Engineering Associates equipthem with the necessary theoretical knowledge and analytical skills for testing, fault

diagnosis and understanding the limitations of complex assets in familiar operatingsituations. Engineering Associates require at least the equivalent of the competenciesin an associate degree in engineering or a diploma or advanced diploma inengineering from a university or TAFE college.

To Engineers Australia the engineering team and the engineering profession aresynonymous. Engineers work in an extraordinary variety of occupations3 and it is a mistaketo believe that engineers work only in a limited range of occupations. There was a time whencareers as engineers were characterised by advancement through a narrow set of experttechnical occupations with long periods of service at most steps. In modern open labourmarkets like that in Australia two important developments have occurred to change this.

First, as the Australian economy has grown in sophistication, the analytical expertise ofengineers has been recognised and applied in an expanding range of circumstances andoccupations. Engineers are now employed as managers, as researchers, as computersoftware and hardware specialists, as financial analysts, especially in respect ofinfrastructure projects and as regulators of industry and transport practices, and in traditionalengineering occupations.

Second, career paths of individuals are more diverse than once was the case. Individualschange jobs more frequently, accept side-ways movements to broaden their experience andoften change jobs to seek new challenges. Work satisfaction, new challenges and making adifference have become important career motivators. Engineers are as much part of this

phenomenon as other professions. In this more complex environment, few occupations thatattract engineers to their ranks retain traditional job titles and the presumption that engineersonly work in jobs with engineer in their job titles is no longer valid.

Individuals with engineering qualifications respond to labour market incentives, like everyoneelse and this may mean that they do not necessarily practice engineering skills. Engineeringqualifications develop an individuals problem solving and analytical skills, skills that arehighly valued across the Australian economy and not just in engineering. In someeconomies, individuals must be registered to practice engineering. Registration simplifies thedistinction between engineering practitioners and engineering graduates who have movedinto non-engineering work. However, registration is not required in Australia, except in ahandful of specific circumstances and membership of organisations like Engineers Australia

is voluntary. Thus distinguishing the two groups is complex and difficult but because it hasvital policy implications, this issue must be confronted to fully understand the dynamics of theprofession.

1.3 Statistical consistency

Australian official statistics are compiled using the statistical classification systems developedand adopted by the Australian Bureau of Statistics (ABS). When the ABS adopts a revised ornew classification system, significant changes can often eventuate. Consequences vary from

3 For an analysis of the US situation see The Education and Employment of Engineering Graduates, EngineeringWorkforce Project Report No 1, Abt Associates, for the National Science Foundation, June 2004,www.abtassociates.com


12/88


Outline of the Overview 3

minor differences in statistics to major discontinuities. The ABS usually gives ample warningof impending changes and often provides overlapping statistics series to demonstrate theimpacts of the change. Many government agencies that collect statistics adopt ABSclassifications as a matter of course. But this is not always the case and some agenciespersist with classifications discarded by the ABS for many years. This practice can havesevere consequences for the comparability of statistical series.

Two situations of this nature are encountered in later Chapters. TAFE statistics collected by

the National Centre for Vocational Education Research (NCVER) moved to a neweducational classification later than the ABS because the NCVER collections are dependenton adoption of the new classification by State Education agencies. The consequences weresome delay in the availability of statistics and a later formal start to the new statistics, so thatthat TAFE time series are one year shorter. These are inconveniences but not major issues.However, the Department of Immigration and Citizenship (DIAC) has persisted with theAustralian Standard Classification of Occupations (ASCO) until 1 July 2011, well beyond themove by the ABS to the Australian and New Zealand Standard Classification of Occupations(ANZSCO) in 2001. This is a more serious issue. Since the ABS change comparability ofemployment and migration statistics has been compromised and now that DIAC has madethe change there will be a major discontinuity in statistics at the level of aggregation neededto study engineers and engineering.

Consistency is not just a matter of whether ABS classifications systems are used or not buthow well classification systems represent the real world. Previous editions of the StatisticalOverview have drawn attention to the difficulties that arise from the practice used to classifythe field of non-school educational qualifications. The key criterion used is to identify the fieldof the highest qualification held by an individual. But the level of a qualification is notnecessarily the best guide to the skills an individual applies in every-day work. Inengineering, it is common for individuals to acquire masters degrees in businessadministration (MBA) to complement engineering qualifications. Typically, these individualscontinue engineering careers4, but in official statistics engineers with an MBA are counteredas part of the business field rather than part of engineering. The consequence is that the

stock of engineers in Australia is under-estimated, potentially by a significant amount. Thereis no reliable way to adjust for this problem.

1.4 Outline of the overview

Wherever possible comparable statistics are reported and where this is not possible. TheStatistical Overview is a work in progress with improvements and additions added each year.This year an important change is the inclusion of new work from the ABS 2006 PopulationCensus. In the past, research into Census statistics was dependent on requestingpredetermined statistical tables from the ABS using their consultancy facilities. Normalresearch experimentation was effectively ruled out by the resource costs involved (bothmonetary and human resources) and the statistics obtained, while useful, provided limitedinsights. This all changed when the ABS released the 2006 Population Census TableBuilder.The advent of this facility has opened up a fresh avenue for research that has significantlyimproved understanding of engineering in Australia.

A second change this year is the inclusion of time series statistics on the engineering labourforce. The source of these previously unavailable statistics was the application ofengineering definitions and concepts to the ABS Education and Work Survey (EWS). Thisannual supplement to the ABS Labour Force Survey (LFS), offers statistics that satisfies the

4

Salaries surveys consistently show that large proportions of engineers hold post-graduate non-engineering

qualifications; see Association of Professional Engineers, Scientists and Managers of Australia (APESMA),Professional Engineers Remuneration Survey Report series, www.apesma.asn.au and Engineers Australia,Salary and Benefits Survey Report series, www.engineersmedia.com.au


13/88



Educational constraints needed to define the engineering labour force within a statisticalframework corresponding to the statistics used for all macroeconomic labour market policydecisions in Australia. This year Engineers Australia commissioned an unpublished dataextract from the EWS for the past decade and applied conventional labour force definitions tocompile estimates of the demand for, and supply of, the engineering team in Australia.

The third change this year is a more detailed examination of statistics relating to thetransition from school to engineering studies. In previous years the trends in student

numbers in enabling subjects for engineering were highlighted. These are once againincluded, but are supplemented by an analysis of the applications for places in engineeringfrom year 12 students, offers made by universities in response and offers accepted bystudents. The profile of tertiary education scores for offers accepted is also analysed.

The final change this year is that State and Territory statistics are made available incompanion publications. The practice in the Statistical Overview has been to focus onnational level statistics with only an occasional reference to State and Territories statistics.There have been numerous requests for State and Territory statistics and the companionpublications provide compatible information for each jurisdiction. Not all the statistics coveredin the Overview are available at State and Territory level.

Chapter 2 deals with the most common statistical question asked of Engineers Australiahow many engineers are there in Australia? The question is considered using Censusstatistics. The chapter also reviews several structural characteristics of the engineering team.Chapter 3 looks at the same question from a time series perspective using EWS statistics.

Chapters 4 and 5 cover engineering education. Chapter 4 looks at the transition from schoolinto engineering courses. Understanding this issue is critical for policy designed to increaseAustralias output of its engineers, and to moderate reliance on immigration of engineers.Chapter 5 deals with the higher education pipeline; new commencements, enrolments andcompletions, for domestic and overseas students. The statistics cover two separate issues;statistics on domestic students chart the education and eventual flow of permanent

Australian residents into the engineering team. The statistics on overseas students primarilydeal with Australias export of engineering education services. While individuals from thisstream can choose to migrate to Australia and join the engineering team, they must firstcomply with migration formalities.

Chapter 6 draws out statistics on the flow of new domestic graduates into the engineeringteam from entry level engineering courses. It covers both university graduates and graduatesfrom TAFE diplomas and advanced diplomas in engineering. TAFE statistics are available forcompletions but not on a consistent basis for commencements and enrolments. As well asoverall numbers, the chapter reviews flows for engineering specialisations.

Chapter 7 looks at immigration of engineers to Australia under permanent and temporary

skilled migration programs. These programs have increasingly put the onus onto employersto deal with skill shortages or temporary imbalances between demand and supply.Employers have responded by sponsoring increasing numbers of temporary migration andthen sponsoring them for conversion to permanent visa status, if employment is satisfactory.Statistics on broad trends in permanent and temporary migration are examined but at thisstage, statistics on the proportion of temporary migrants that later become permanentmigrants are not available.

Chapter 8 examines trends in a range of characteristics of engineers including, workexperience, age and salaries. These statistics come from the APESMA salary surveys.These surveys are based on statistical sample design principles with samples drawn fromAPESMA and Engineers Australia members but only for professional engineers. Never-the-

less the statistics contains useful and important insights.


14/88



Finally, chapter 9 brings together what is known about the supply of and demand forengineers from earlier chapters and survey results on the consequences of engineering skillsshortages for employers.


15/88

2. THE STRUCTURE AND CHARACTERISTICS OFENGINEERING IN AUSTRALIA

Cross section and time series statistics 6

Key points

This chapter deals with census statistics using standard labour market definitions.These statistics are the most detailed but are now 5 years old.

In 2006, there were 305,000 people in the engineering population (that is, they hadappropriate formal educational qualifications in engineering).

There were about 249,785 people in the engineering labour force, with 242,419employed and 7,366 unemployed. The unemployment rate was 2.9% (compared to5.2% in the economy) and was higher for women (5.2%) than men (2.7%).

About 57% of the engineering labour force was employed in engineering occupations,

the balance were either employed in non-engineering occupations or wereunemployed.

Reliance on engineers born and trained overseas is not a recent phenomenon andhas been a feature of the Australian labour market for many years. Theunemployment rate for overseas born people (4.3%) in the engineering labour forcewas higher than for Australian born people (1.8%). The labour market experience ofoverseas born engineers is related to how long they have been in Australia.

About 40% of engineers are employed in manufacturing and consulting industries.The remainder are spread across every industry. Mining ranks 11thas an employer ofengineers and in 2006 employed 3.6%.

The average age of the engineering labour force was 41.9 years (42.5 years men and36.6 years women) compared to 40.3 years for non-engineering skills (40.5 yearsmen and 39.1 years women).

The engineering labour force has an age structure that is older than the Australianlabour force mainly due to the age of former generations of migrant engineers.

2.1 Cross section and times series statistics

The most common question put to Engineers Australia is how many engineers doesAustralia have? Variations on this question deal with gender, location, engineeringspecialisations and industry of employment. Census statistics can provide answers withconsiderable detail, but relate only to the census year and provide no detail for later years.The Australian census is conducted every five years and for some issues this frequencydoes not adequately describe contemporary events, especially when rapid changes areoccurring. However, broad structural characteristics of a labour force typically change slowlyand census statistics are important metrics for policy analyses.

Ideally, policy analyses should employ both cross section and time series statistics toestablish structural characteristics of the engineering labour force and to examine changes

over time. This chapter deals with the former using ABS census statistics for 2006 and theon-line TableBuilder facility made available by the ABS. TableBuilder allows users to design


16/88


The engineering labour force 7

and construct tables from census data bases to suite their objectives thus facilitatingresearch experimentation. Robust use of census statistics can significantly advanceunderstanding of the engineering labour force. While there are some limitations associatedwith census definitions and statistical classifications, working with them is a small price topay for this information. Another census is due in August 2011 and shortly the flexibility of theTablebuilder facility can be directed at examining detailed changes across two census yearsadding a new dimension to understanding of the engineering labour force.

Time series statistics for the entire engineering labour force have not previously beenavailable. Various approaches have been employed to overcome this deficiency. Someanalysts have used occupational extracts from the ABS labour force surveys. When dealingwith general labour market questions this is a useful approach but, because the labour forcesurvey does not collect information about an individuals field and level of education, it isseverely limited when it comes to analysing a group defined by formal education in a specificfield. Other substitutes include studying the trends in statistics relating to changes in thestock of engineers like education and migration statistics. This is done in later chapters, butavailable statistics do not cover all the flows into and out of the stock of engineers, a notableomission is statistics on the numbers leaving the labour force to retire or for personalreasons. Chapter 3 looks at a fresh approach to time series statistics to overcome this

problem but while good aggregate statistics can be compiled the compromise is the level ofdetail available.

2.2 The engineering labour force5

The definitions used in this section are conventional labour market concepts applied to theengineering team as described in section 1.2. The engineering population is the sub-set ofthe Australian population with a postgraduate degree, diploma or certificate, a bachelorsdegree, an associate degree or an undergraduate diploma or advanced diploma inengineering. The engineering labour force is the engineering population that is employed orunemployed, but actively seeking work. The term not in the labour force refers to the

engineering population that is not actively pursuing employment. Using these definitions,Table 2.1 describes the structure of the engineering labour force, and provides measures oflabour force participation, unemployment and the proportion of the engineering labour forceemployed in engineering.

Table 2.1: T he engineering labour force in Australia, 2006 census

Labour Force

Status Males Females Total Males Females Total Males Females Total Males Females Total

Employed Full Time 23574 2518 26092 92583 9854 102437 70055 3633 73688 186212 16005 202217

Employed Part T ime 3024 690 3714 10474 3066 13540 9812 2081 11893 2 3310 5837 29147

Employed away from work 950 196 1146 4273 766 5039 4511 359 4870 9734 1321 11055

Tota l Employed 27548 3404 30952 107330 13686 121016 84378 6073 90451 219256 23163 242419

Unemployed seeking FT 652 117 769 2162 411 2573 1773 168 1941 4587 696 5283

Unemployed seeking PT 162 64 226 765 314 1079 589 189 778 1516 567 2083

Total Unemployed 814 181 995 2927 725 3652 2362 357 2719 6103 1263 7366Labour Force 28362 3585 31947 110257 14411 124668 86740 6430 93170 225359 24426 249785

Not in the Labour Forc e 44 74 751 5225 1 79 60 38 95 21855 2 4561 3 592 28 153 469 95 823 8 55233

Engineering Population 32836 4336 37172 128217 18306 146523 111301 10022 121323 272354 32664 305018

Unemployment rate (%) 2.9 5.0 3.1 2.7 5.0 2.9 2.7 5.6 2.9 2.7 5.2 2.9

Participation rate (%) 86.4 82.7 85.9 86.0 78.7 85.1 77.9 64.2 76.8 82.7 74.8 81.9

Employed in Engineering 19864 2048 21912 73995 7325 81320 38281 1309 39590 132140 10682 142822

% in Engineering 70.0 57.1 68.6 67.1 50.8 65.2 44.1 20.4 42.5 58.6 43.7 57.2

Source: Compiled using ABS 2006 Population Census T ableBuilder

Post-graduate Bachelors Degree Diplomas Engineering T eam

In 2006, there were 305,018 individuals in the engineering population in Australia. Theengineering population comprised 89.3% males and 10.7% females. About 12.2% of the

5The material in this chapter draws on Engineers Australia, The Engineering Profession in Australia, A Profile

from the 2006 Population Census, September 2010, www.engineersaustralia.org.au


17/88


The engineering labour force 8

Engineering population had postgraduate qualifications and 48.0% had a bachelors degreein engineering. The ABS defines a bachelors degree as having a duration between three andsix years, thus 60.2% of the engineering population were qualified to be professionalengineers or engineering technologists. Unfortunately, further disaggregation is not possible.The remaining 39.8% of the engineering population has diplomas or advanced diplomas inengineering. All ages from 15 years onwards are included in these figures.

The engineering population was divided between an engineering labour force comprising249,785 individuals and 55,233 individuals were not in the labour force. The majority of thelatter group had retired, but about 6,002 were students in full time studies, mainly in the 24 to34 years age groups, likely to re-enter the labour force on the completion of their studies.

The engineering labour force is small in the Australian context and in 2006 was only 2.6% ofthe Australian labour force. The participation rate (the proportion of the engineeringpopulation active in the labour market) for engineering labour force was 81.9%. To evaluatethis result it can be compared to the participation rate for non-engineering skills with thesame level of qualifications; the rate for this group was only slightly lower than in engineering(80.8%) but both skilled groups had participation rates significantly higher than thecorresponding rate in general labour force (64.6%).

Employment levels in engineering were very high and unemployment was very low. Therewere 242,419 individuals employed and 7,366 unemployed, yielding an unemployment rateof 2.9% compared to 5.2% for the economy. Unemployment rates this low are oftendescribed by economists as frictional unemployment, resulting from the short periods ofunemployment that occur between individuals moving from one job to another. Very lowunemployment in the engineering labour force is a sign of engineering skills shortages. But,skill shortages were not unique to engineering and were also experienced among non-engineering skilled groups where the unemployment rate was 3.0%.

The proportion of females is successively lower in the engineering population (10.7%), the

engineering labour force (9.8%) and employed engineers (9.6%). Female unemploymentrates were twice male unemployment rates, irrespective of qualification level. Thisphenomenon was not evident among non-engineering skills groups. Just over 25% of femaleengineers were employed part time compared to 10.6% of males, but the skewed genderbalance meant that males employed part time out-numbered females by over four to one.Growth in the number of female engineers is a comparatively recent phenomenon and isreflected in the mix of female engineering qualifications; comparatively few females holdengineering associate qualifications which were more prevalent during earlier decades.

2.3 Employment in engineering

There is a widespread presumption that everyone with engineering qualification works in

engineering. Research6 reported elsewhere shows that this is not the case and that largenumbers of individual who have engineering qualifications choose to work outside ofengineering. Using 2006 census statistics, this research applied several criteria (formalqualifications, level of work undertaken and a scale of attachment to engineering) to showthat 51 of 358 4-digit ANZSCO occupations can be identified as engineering occupations.Some of the remaining occupations retained loose connections to engineering but insufficientto warrant exclusive specialist engineering know-how.

The statistics from this research are summarised in Table 2.1 and shows that 142,822individuals in the engineering labour force were employed in the 51 engineering occupationsidentified and of the remainder 99,597 were employed in non-engineering occupations and7,366 were unemployed. In other words, 57.2% of the engineering labour force was actually

6

Op cit, pp27-31


18/88


Industry distribution and engineering specialisations 9

employed in engineering. This raises the question whether engineering skills have been usedproductively in non-engineering occupations?

Successive Australian governments have maintained that the productivity of the economy isimproved as education level of the labour force rises. Aspects of this policy are given more orless emphasis from time to time but it has not been qualified by requiring people to work inoccupations directly relating to the field of their training. In other words, providing that

engineering qualifications are used in a manner that is consistent with the level of traininginvolved, it can be said that they have been productively used.

The engineering work undertaken by the engineering team is graded as level 1 or level 2 inthe Australian Qualification Framework and productive deployment of these qualifications innon-engineering work requires that the occupations involved are also graded at level 1 orlevel 2. This criterion was applied to all 4-digit ANZSCO occupations where engineers wereemployed. It was confirmed that the 142,822 individuals with engineering qualificationsemployed in 58 identified engineering occupations worked at the appropriate level. Another40,179 individuals or 16.1% of the engineering labour force worked in non-engineeringoccupations at level 1 or level 2. Although these engineering resources were not used inengineering work, they were used productively elsewhere in the economy. The remaining

66,784 individuals employed in occupations graded as level 3 or lower, or were unemployed.These engineering resources were not applied in a manner commensurate with their trainingand could not be said to be productively used. In some instances the occupations concernedwere in engineering but involved, for example, individuals trained to the level required by theengineering team working as engineering trades-persons.

2.4 Immigration and the engineering labour force

Over the past decade, skilled migration has been the Federal Governments first lineresponse to persistent skill shortages. Immigration has been a feature of Australian life formany decades, but in engineering where skills shortages have been particularly acute, the

shift in policy to favour skilled workers poses the question what are the longer termimplications for engineering? Table 2.2 offers a perspective by disaggregating Table 2.1 intotwo groups, those born in Australia and those born overseas. Born overseas and skilledmigrants are not necessarily synonymous. Born overseas includes the children of earliergenerations of migrants who grew to adulthood and were educated in Australia, as well asrecently arrived adults who were educated and may have acquired work experienceoverseas. Statistics that focus on this distinction are unavailable and examining persons bornoverseas and taking account of time of arrival in Australia, as done in Table 2.3, is a suitablesurrogate.

In the census there were 140,312 of the engineering population were born overseas, 46% ofthe total. Labour force participation for the overseas born was lower than for the Australian

born group, mainly due to lower participation by overseas born females. The overseas bornengineering labour force was 112,086, with 107,215 employed and 4,781 unemployed.Overseas born unemployment was higher than for the Australian born engineering labourforce and accounted for two-thirds of engineering unemployment. This is reflected in therespective unemployment rates; 4.3% for the overseas born and 1.8% for the Australianborn. Despite this difference the overseas born unemployment rate was lower than thecorresponding general unemployment rate in the economy.

The female share of the engineering population was higher for the overseas born componentthan the Australian born component. Skilled migration, in other words, has helped to liftfemale participation in Australian engineering. Both male and female overseas bornunemployment rates fall the longer the period since arrival in Australia. Unemployment ratesfor the most recent arrivals are above general economy unemployment, particularly forfemales.


19/88



Table 2.2: The engineering labour force in Australia by country of origin, 2006 census

Labour Force

Status Males Females Total Males Females Total Males Females Total

Employed Full Time 107238 6951 114189 78974 9054 88028 186212 16005 202217

Employed Part Time 11888 2626 14514 11422 3211 14633 23310 5837 29147

Employed away from work 5822 679 6501 3912 642 4554 9734 1321 11055

Total Employed 124948 10256 135204 94308 12907 107215 219256 23163 242419

Unemployed seeking FT 1769 149 1918 2818 547 3365 4587 696 5283

Unemployed seeking PT 461 116 577 1055 451 1506 1516 567 2083

Total Unemployed 2230 265 2495 3873 998 4871 6103 1263 7366

Labour Force 127178 10521 137699 98181 13905 112086 225359 24426 249785

Not in the Labour Force 24473 2534 27007 22522 5704 28226 46995 8238 55233

Engineering Population 151651 13055 164706 120703 19609 140312 272354 32664 305018

Unemployment rate (%) 1.8 2.5 1.8 3.9 7.2 4.3 2.7 5.2 2.9

Participation rate (%) 83.9 80.6 83.6 81.3 70.9 79.9 82.7 74.8 81.9

Employed in Engineering 80833 5474 86307 51307 5208 56515 132140 10682 142822

% in Engineering 63.6 52.0 62.7 52.3 37.5 50.4 58.6 43.7 57.2

Source: Compiled using ABS 2006 Population Census TableBuilder

Australian Born Overseas Born Engineering Team

Table 2.3: The overseas born engineering labour force, time of arrival in Australia, 2006 census

Labour Force

Status Males Females Total Males Females Total Males Females Total Males Females Total

Employed Full Time 38170 2888 41058 21879 3550 25429 18925 2616 21541 78974 9054 88028

Employed Par t T ime 5352 1034 6386 2180 1068 3248 3890 1109 4999 1 1422 3211 14633

Employed away from work 2069 225 2294 936 221 1157 907 196 1103 3912 642 4554

Total Employed 45591 4147 49738 24995 4839 29834 23722 3921 27643 94308 12907 107215

Unemployed seeking FT 1119 76 1195 726 142 868 973 329 1302 2818 547 3365

Unemployed seeking PT 291 76 367 157 108 265 607 267 874 1055 451 1506

Total Unemployed 1410 152 1562 883 250 1133 1580 596 2176 3873 998 4871

Labour Force 47001 4299 51300 25878 5089 30967 25302 4517 29819 98181 13905 112086

Not in the Labour Force 14970 1788 16758 3009 1673 4682 4543 2243 6786 22522 5704 28226

Engineering Population 61971 6087 68058 28887 6762 35649 29845 6760 36605 120703 19609 140312

Unemployment rate (%) 3.0 3.5 3.0 3.4 4.9 3.7 6.2 13.2 7.3 3.9 7.2 4.3

Participation rate (%) 75.8 70.6 75.4 89.6 75.3 86.9 84.8 66.8 81.5 81.3 70.9 79.9

Employed in Engineering 25856 1760 27616 13117 1844 14961 12334 1604 13938 51307 5208 56515

% in Engineering 55.0 40.9 53.8 50.7 36.2 48.3 48.7 35.5 46.7 52.3 37.5 50.4

Source: Compiled using ABS 2006 Population Census TableBuilder

Prior to 1990 1991 to 1999 2000 to 2006 All Overseas Born

The proportion of the overseas born engineering labour force employed in engineeringoccupations was lower than for Australian born. For the Australian born engineering labourforce 62.7% were employed in engineering occupations and 37.3% were either employed innon-engineering occupations or were unemployed. The proportion of males employed inengineering was even higher at 63.6%. However, only 50.4% of the overseas bornengineering labour force was employed in engineering occupations. In the case of overseasborn females, the majority were employed in non-engineering occupations or wereunemployed and only 37.5% employed in engineering occupations.

Skilled migration is not new to engineering. The Tables show that just under half of theoverseas born engineering population arrived in Australia over twenty years ago. Time inAustralia is an important factor in the labour market experience of the overseas bornengineering population. Skilled migration rules favour younger age groups and it was onlyduring 2011 that prospective migrants aged 40 years and over could apply for a visa.

The emphasis on younger migrants is reflected in the labour force participation rates in Table2.3 and in the fall in unemployment rates as time in Australia increases. The same pattern isalso evident in proportion of the overseas born engineering labour force employed in

engineering. In the most recently arrived group, only 46.7% were employed in engineeringoccupations and 53.3% were employed in non-engineering occupations or wereunemployed. Skilled migration rules have recently changed to address this issue.


20/88



2.5 Industry distribution and engineering specialisations

The engineering labour force is employed in most industries and covers a wide range ofengineering specialisations. Details of these distributions are set out in Table 2.4 (males),Table 2.5 (females) and Table 2.6 (both genders combined). Figure 2.1 illustrates theindustry distribution and Figure 2.2 illustrates the distribution by engineering specialisations.

0.0 5.0 10.0 15.0 20.0

Agriculture, Forestry and Fishing

Mining

Manufacturing

Electricity, Gas, Water and Waste Services

Construction

Wholesale Trade

Retail TradeAccommodation and Food Services

Transport, Postal and Warehousing

Information Media and Telecommunications

Financial and Insurance Services

Rental, Hiring and Real Estate Services

Professional, Scientific and Technical Services

Administrative and Support Services

Public Administration and Safety

Education and Training

Health Care and Social Assistance

Arts and Recreation Services

Other Services

Inadequately described & not stated

Share of employment (%)

Figure 2.1: The industry distribution of the employed engineering labourforce, 2006 population census

Total Females Males

0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0

Engineering & Related Technologies

Manufacturing

Process & Resources

Automotive

Mechanical & Industrial

Civil

Electrical & Electronic

Aerospace

Maritime

Other Engineering

Figure 2.2: The distribution of the employed engineering labour force byengineering specialisations, 2006 population census

Total Females Males

Two industries dominate the industry distribution. They are Professional, Scientific andTechnical Services with 48,454 employed engineers (20.0%) and Manufacturing with 47,129employed engineers (19.4%). Over the past decade these industries have experienced quitedifferent employment circumstances7. Total employment in Professional, Scientific andTechnical Services grew by 49.2% between February 2000 and May 2011. In all probabilityengineering employment will have shared this growth. However, over the same period,

7ABS, Labour Force, Australia, Detailed, Quarterly, Cat No 6291.0.55.003, May 2011, www.abs.gov.au


21/88



total employment in Manufacturing has fallen by 9.0% and it is likely that engineeringemployment has also fallen.

The third largest industry, Public Administration and Safety, employed 9.4% of theengineering labour force. Industry shares fell quite rapidly after that; with 7.2% employed inConstruction; 6.1% in Transport, Postal & Warehousing; 4.1% employed in Electricity, Gas,Water & Waste Services; 3.9% in Information Media and Telecommunications and 3.7% in

each of Education and Training and Retail Trade.

In recent years the Mining industry has attracted a lot of attention. However, directemployment of the engineering team in the Mining industry is relatively modest. In May 2011,there were 213,200 Australian employed in Mining. The census showed that the Miningindustry employed 8,726 engineers, or 3.6% of engineers. Even with substantial growthdirect employment of engineers in mining would remain a modest share.

The nomenclature applied by educational institutions to engineering qualifications haschanged over time even though most engineering qualifications have common elements andoften are specialisations of four key branches; mechanical, electrical, civil and chemicalengineering. The engineering specialisations in Tables 2.4 to 2.6 use the Australian Standard

Classification of Education (ASCED) but the statistics show how engineers describe thebranch of engineering they belong to. To facilitate understanding the following additionalinformation is provided about engineering specialisations included in the categoriesdescribed in the Tables.

Process and Resource Engineering includeso Chemical Engineeringo Mining Engineeringo Materials Engineeringo Food Processing Technology

Mechanical and Industrial Engineering includeso

Mechanical Engineerso Industrial engineers

Civil Engineering includeso Civil Engineerso Construction Engineerso Building Services Engineerso Water and Sanitary Engineerso Transport Engineerso Geotechnical Engineerso Ocean Engineers

Electrical and Electronic Engineering includeso Electrical Engineerso Electronic Engineerso Computer Engineerso Communication Technologies

Aerospace Engineering includeso Aerospace Engineerso Aircraft Maintenance Engineers

Maritime Engineering includeso Maritime Engineerso Maritime Construction Engineers

Other Engineering includeso Environmental Engineerso Biomedical Engineers


22/88



Table 2.4: Engineering specialisations and employing industries; 2006 census, males

Engineering & Manufacturing Process & Automotive Mechanical & Civil Electrical & A

Related Resources Industrial Electronic

Agriculture, Forestry and Fishing 619 23 168 13 178 150 275

Mining 3173 36 2669 8 750 320 853

Manufacturing 20038 1354 4052 91 6416 1195 7950

Electricity, Gas, Water and Waste Services 3972 43 244 4 554 901 3300

Construction 7057 126 392 21 1180 3896 3278

Wholesale Trade 4411 271 638 29 1102 329 3615

Retail Trade 2852 188 394 71 739 406 2160

Accommodation and Food Services 1315 94 199 11 295 250 819

Transport, Postal and Warehousing 3647 118 279 45 859 743 2172

Information Media and Telecommunications 2802 79 82 8 172 135 5318

Financial and Insurance Services 2183 42 307 5 267 225 994

Rental, Hiring and Real Estate Services 865 49 90 14 139 250 362

Professional, Scientific and Technical Services 22730 297 2170 28 3062 6134 8116

Administrative and Support Services 1440 78 235 13 360 251 1005

Public Administration and Safety 8140 110 590 41 970 3654 3611

Education and Training 3282 113 641 16 488 411 1871

Health Care and Social Assistance 1212 40 137 8 251 140 944

Arts and Recreation Services 415 17 51 3 86 68 325

Other Services 1573 63 133 89 531 179 1836

Inadequately described & not stated 2294 69 221 9 391 281 1293

Total 94020 3210 13692 527 18790 19918 50097

Source: ABS, 2006 Population Census Tablebuilder


23/88



Table 2.5: Engineering specialisations and employing industries; 2006 census, females

Engineering & Manufacturing Process & Automotive Mechanical & Civil Electrical & A



Mining 263 6 258 0 35 18 21

Manufacturing 1466 489 1130 6 284 124 439


Construction 454 48 51 0 43 219 78

Wholesale Trade 428 167 194 0 69 46 215

Retail Trade 482 435 211 0 100 66 237


Transport, Postal and Warehousing 246 41 42 0 42 69 100

Information Media and Telecommunications 314 33 28 0 15 25 316









Other Services 110 81 54 0 24 29 70


Total 9414 2148 3505 9 1194 2028 3302



24/88



Table 2.6: Engineering specialisations and employing industries; 2006 census, persons

Engineering & Manufacturing Process & Automotive Mechanical & Civil Electrical &



Mining 3436 42 2927 8 785 338 874

Manufacturing 21504 1843 5182 97 6700 1319 8389


Construction 7511 174 443 21 1223 4115 3356

Wholesale Trade 4839 438 832 29 1171 375 3830

Retail Trade 3334 623 605 71 839 472 2397


Transport, Postal and Warehousing 3893 159 321 45 901 812 2272 Information Media and Telecommunications 3116 112 110 8 187 160 5634









Other Services 1683 144 187 89 555 208 1906


Total 103434 5358 17197 536 19984 21946 53399



25/88



The largest numbers of engineers allocate themselves to the category Engineering andRelated Technologies not further defined. In other words, these individuals see themselvesas general engineers rather than as specialists belonging to the other categories listed inthe Tables. In all, 103,434, or 42.7% of employed engineers are in this group. The nextlargest group is Electrical and Electronic Engineers with 53,399, or 22.0% of employedengineers. All other groups have shares in single digits; Civil engineers were 9.1% ofemployment; Mechanical and Industrial engineers were 8.2%; Process and Resource

engineers were 7.1%; Aerospace engineers were 5.0% and Manufacturing and Maritimewere 2.2% and 2.0% respectively. There were only 1.5% of employed engineers in theother category.

2.6 Age and age structure

This section looks at the age and age structure of the engineering labour force and comparesit to the age and age structure of similarly qualified non-engineering skills groups. In thischapter, age is open ended and not restricted by the convention that normal working agesare between 15 and 64 years. This point is highlighted because the statistics to be reviewedin chapter 3 are based on this convention. The convention was in general use in ABS

statistics until about two years ago when the recognition that Australians are working longerwas reflected by extending age coverage to 74 years.

Estimates of the average age of engineering labour force were obtained from statistics onsingle year ages, weighting each age according to labour force numbers8. The average ageof the engineering labour force in the 2006 census with no age restriction was 41.9 years;males had an average age of 42.5 years while females were about 6 years younger with anaverage age of 36.6 years. Individuals with diploma qualifications were on average almost 3years older than those with degree qualifications with average ages of 44.1 years and 40.6years, respectively.

For the conventional working age population age range, the average age falls slightly to 41.2

years. The average age for men falls a little more than for women to 42.0 years and 36.4years, respectively. The difference between average ages of degree and diploma qualifiedindividuals is much the same.

The average age of the engineering labour force is 1.6 years more than the average age ofsimilarly qualified non-engineering skills groups; the average ages were 41.9 and 40.3 yearsrespectively. Part of this gap is explained by engineering men being on average 1.2 yearsolder and the remainder by older non-engineering women. Although the average age forengineering women at 36.6 years is significantly lower than non-engineering women at 39.5years, the latter were over half the non-engineering labour force compared to 9.8% inengineering. For the conventional working age range, the average age of the non-engineering labour force is 39.7 years compared to 41.2 years for engineering.

The age structure for the engineering labour force is described in Table 2.7 and Table 2.8shows the same information for the non-engineering labour force (the labour force ofindividuals with at least a diploma level qualification in any non-engineering discipline).Figures 2.3 and 2.4 illustrate these age structures using standard population pyramids.

The engineering labour force has a pronounced gender imbalance as seen in the aboveillustrations. The proportion of women is comparatively low, especially in the older age

8 For practical and resource reasons, ages up to and including 85 years were included in the estimates. Therewere 93 individuals in the engineering labour force above this age and the impact of their inclusion would benegligible.


26/88


Age structure of the engineering labour force 17

groups and impedes discussion. Instead of looking at age groups by gender, a consolidatedapproach is used instead.

Table 2.7: The age structure of the engineering labour force, 2006 population census

Males Females Total Males (%) Females (%) Total (%)

15-19 years 246 49 295 0.10 0.02 0.12

20-24 years 10774 2284 13058 4.31 0.91 5.2325-29 years 24367 4809 29176 9.76 1.93 11.68

30-34 years 30135 4612 34747 12.06 1.85 13.91

35-39 years 30537 3615 34152 12.23 1.45 13.67

40-44 years 32964 3532 36496 13.20 1.41 14.61

45-49 years 30138 2727 32865 12.07 1.09 13.16

50-54 years 26980 1547 28527 10.80 0.62 11.42

55-59 years 21361 787 22148 8.55 0.32 8.87

60-64 years 11402 294 11696 4.56 0.12 4.68

65 and over 6455 172 6627 2.58 0.07 2.65

Total 225359 24428 249787 90.22 9.78 100.00

Source: ABS, 2006 Population Census TableBuilder

Table 2.8: the age structure of non-engineering skills, 2006 population census

Males Females Total Males (%) Females (%) Total (%)

15-19 years 2399 4964 7363 0.09 0.19 0.28

20-24 years 81297 138690 219987 3.06 5.21 8.27

25-29 years 144402 220646 365048 5.43 8.29 13.72

30-34 years 163525 223088 386613 6.15 8.38 14.53

35-39 years 159605 202481 362086 6.00 7.61 13.61

40-44 years 145178 188311 333489 5.46 7.08 12.53

45-49 years 145613 192153 337766 5.47 7.22 12.69

50-54 years 130656 161851 292507 4.91 6.08 10.99

55-59 years 99740 106890 206630 3.75 4.02 7.77

60-64 years 51538 46350 97888 1.94 1.74 3.68

65 and over 31474 20063 51537 1.18 0.75 1.94

Total 1155427 1505487 2660914 43.42 56.58 100.00

Source: ABS, 2006 Population Census T ableBuilder

-14.00 -12.00 -10.00 -8.00 -6.00 -4.00 -2.00 0.00 2.00 4.00

15-19 years

20-24 years

25-29 years

30-34 years

35-39 years

40-44 years

45-49 years

50-54 years

55-59 years

60-64 years

65 and over

% in Age Groups

AgeGroups

Figure 2.3: The age structure of the engineering labour force, 2006population census

Females Males


27/88



In general, there are proportionally fewer individuals in lower age groups and proportionallymore in older age groups in engineering than is the case in non-engineering skills. Inengineering, the average age occurred in the largest age group, 40 to 44 years with 14.6%.Although the non-engineering average was in the same age group, here it was the fifthlargest group with three larger groups in the younger ages and one in the older. Inengineering, 44.6% of the labour force was younger than 40 years compared to 50.4% fornon-engineering.

The reverse is true for older age groups. In engineering, 40.8% of the labour force were aged45 years and over and 16.2% were aged 55 years and over. Nearly all of these individualswere men. In the non-engineering skills, there were proportionally fewer in these age groupswith 37.1% and 13.4% respectively and there was a more even gender balance. Thesuggestion is that the engineering labour force is older and its dependence on men meansthat as older groups retire, replacing them by younger men will become increasingly moredifficult.

-8.00 -6.00 -4.00 -2.00 0.00 2.00 4.00 6.00 8.00 10.00

15-19 years

20-24 years

25-29 years

30-34 years

35-39 years

40-44 years

45-49 years

50-54 years

55-59 years

60-64 years

65 and over

% in Age Groups

AgeGroups

Figure 2.4: The age structure of non-engineering skills groups, 2006population census

Females Males

Table 2.9: Labour force shares, selected age groups, engineering & non-engineering skills

Age Non-engineering

Group Total Australian born Overseas born labour force (%)

15 to 34 years 30.94 34.40 26.68 36.80

35 to 54 years 39.19 35.98 56.18 36.21

55 years & over 16.20 15.43 17.14 13.39

Engineering labour force (%)

Skilled migration has been the mainstay of the Commonwealth Governments response toskills shortages. Since the skilled migration points test has a strong bias in favour of youngerprospective migrants and excludes those over 45 years entirely, there has been apresumption that the age structure for the overseas born component of the engineeringlabour force is younger and that it is the Australian born component that is aging. Table 2.9shows that the contrary is true because immigration is not a new feature of the engineeringlabour force and earlier generations of migrant engineers are themselves aging.

In 2006, there were 26.7% persons aged 34 years and younger in the overseas born

component of the engineering labour force compared to 34.4% for the Australian borncomponent. The overseas born component had 56.2% in the middle years and 17.1% in the


28/88



later years of working life compared to 36.0% and 15.4% respectively for the Australian borncomponent. The high concentration of overseas born in the middle age groups reflects theoperation of the points test favouring migrants in these ages. The proportion of the Australianborn component aged 55 years and over is well above the corresponding proportion for non-engineering skills, but the proportion of overseas born engineers in this group is higher still at17.1%.


29/88

3. HOW HAS THE ENGINEERING LABOUR FORCE

CHANGED OVER TIME?

Introduction 20

Key Points

This chapter uses ABS statistics from a supplementary Labour Force Survey toexamine changes in the engineering labour market over the last decade. Thesestatistics do not cover as much detailed information as census statistics but canmeasure changes that have occurred over the last decade.

Growth in the supply of engineers averaged 4.8% per annum over the past decade.Growth in the demand for engineers also averaged 4.8% per annum. Both demandand supply growth exceeded 4.5% average annual growth in the engineeringpopulation (the population with relevant formal qualifications in engineering). Until theGFC, the gap was bridged by increasing labour force participation and even lowerunemployment.

The unemployment rate fell to 2.4% in 2008. Rates this low are considered frictionalunemployment, the short periods of unemployment that occurs when people changejobs. The impact of the GFC was to increase the unemployment rate to 4.1% in 2010.In 2010, unemployment fell back to 3.7%, indicating a return to tight engineeringlabour market conditions.

Engineering was not unique in experiencing tight labour market conditions. There wasalso strong growth in the supply of, and demand for, comparably qualified non-engineering skills. Non-engineering skills were not as severely impacted by the GFCas was engineering. There was also more variability in demand in engineering thanfor other skills.

Although there was some increase in the proportion of the engineering labour forceemployed in engineering occupations, this was quite small. Only a few years ofstatistics were available for this measure and show a range of 54 to 58%, consistentwith census statistics.

Engineering is far more dependent on skilled migration than is the case for non-engineering skills. In 2010, the overseas born share of employment was 52.6% inengineering compared to 36.0% for non-engineering skills and 26.8% for the generallabour force.

3.1 Introduction

Chapter 2 considered the structure and characteristics of the engineering labour force,drawing on cross section statistics from the 2006 population census. When the 2011population census statistics become available, the TableBuilder facility will be used toexamine how the detailed measures available in the census change over time. This chapterconsiders broad changes that have occurred since the census drawing on ABS Educationand Work statistics.


30/88


Trends in the engineering labour force 21

Macroeconomic analyses of the Australian labour market usually employ statistics from theABS Labour Force Survey (LFS) that is designed to measure the demand for and supply oflabour. The LFS cannot be used to measure changes in the demand for and supply ofengineers because it cannot satisfy the requirement that the engineering population musthave relevant formal qualifications in engineering. Although the LFS can distinguish betweenbroad categories of workers such as managers, professionals and trades-people, the surveyquestionnaire does not collect the necessary information between, for example, an

engineering professional as defined in the engineering team and a professional in anotherarea like accounting. In other words, an alternative to the LFS is needed.

The development of surveys supplementary to the LFS offers a way forward. Supplementarysurveys were developed by the ABS as a response to growing demand for additionalstatistics to analyse the labour market more thoroughly. Among the issues of concern werethe transition from, initially, school to work and later from post school education to work. TheEducation and Work Survey (EWS) was devised as part of a program of labour forcesupplementary surveys. The EWS is conducted annually in May using the same sampleframework as the LFS but with a focus on education and the labour market. The EWS can beused to construct measures of the engineering labour force because it includes questionsconcerning the field and level of qualifications and related matters, as well as labour market

status.

EWS statistics have not been previously used to analyse the engineering labour market.Published EWS statistics have focused on across the board policies concerning therelationship between labour market experience and education and this is where research hastypically been directed. The specific requirements needed to analyse the engineering labourmarket are not available from EWS publications or ABS web resources. Followingdiscussions with the ABS, a formal request for unpublished EWS statistics was made. Thesestatistics were analysed in a separate report9. This chapter discusses some of the materialfrom this report to examine how the engineering labour market has changed over the pastdecade.

Some differences between EWS and census statistics should be noted. 2. EWS statistics areproduct of a sample survey of the civilian population, whereas the Census is a completeenumeration of the Australian population. The civilian population does not include defencepersonnel, a relatively large employer of engineers, but the census does. For many years theEWS sampled what has conventionally been described as the working age population orpopulation aged 15 to 64 years. This changed two years ago when the EWS sample wasbroadened to include the 65 to 74 years age groups. Unfortunately, for time series workfurther time needs to elapse before there is sufficient statistics for this age group for usefulanalyses. In other words, the EWS statistics in this chapter cover ages 15 to 64 yearscompared to all ages in the census.

The EWS like all surveys is limited in the statistical disaggregations that it can support. Thecensus showed that the engineering labour was only 2.6% of the Australian labour marketand thus at best is a similar share of the EWS sample. Even some straightforward measureslike gender, encounter standard error problems. The discussions with the ABS facilitated thechoice of variables requested to situations where standard errors do not compromiseanalysis. As a result, important insights about the engineering labour force are available fromEWS statistics and are comparable in quality to other labour market statistics used for policypurposes in Australia.

9Engineers Australia, The Engineering Labour Force in Australia, 2001 to 2010, June 2011,

www.engineersaustralia.org.au


31/88



3.2 Trends in the engineering labour force

The main characteristics of the engineering labour market and engineering population areshown in Table 3.1. The engineering population is the subset of the population that hasrelevant formal qualifications in engineering consistent with the engineering team. It includesall individuals who have a visa to reside and work in Australia, including temporary visas. In2001, the engineering population was 273,900. Over the decade to 2010, average annualgrowth for the engineering population was 4.5%, increasing the population to 407,000 or48.6%.

Table 3.1: The engineering labour force ('000)

Year Employed Unemployed Labour force Not in lf Population

2001 232.7 9.5 242.2 31.7 273.9

2002 262.6 11.8 274.4 29.1 303.5

2003 273.5 11.8 285.3 29.9 315.2

2004 270.3 9.5 279.8 35.1 314.9

2005 283.3 9.1 292.4 34.1 326.5

2006 293.3 9.3 302.6 29.8 332.4

2007 315.5 8.9 324.4 34.5 358.9

2008 336.8 8.2 345.0 31.9 376.9

2009 341.8 14.7 356.5 34.4 390.9

2010 352.9 13.7 366.6 40.4 407.0

Source: ABS data extract from EWS

The supply of engineers is measured by the engineering labour force, or the subset of theengineering population actively engaged in the labour market. In 2001, the supply ofengineers was 242,200. Average annual growth over the decade was 4.8%, increasing thesupply of engineers by more than growth in the engineering population. By 2010, the supplyof engineers had increased by 51.4% to 366,600. In the process the labour forceparticipation rate, already very high, increased further and in 2010 was 90.1%.

90.0

100.0

110.0

120.0

130.0

140.0

150.0

160.0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Indexnumber(2001=100)

Figure 3.1: Relative growth in the engineering, non-engineering skilled and

Australian labour supplyEngineering Non-engineering Australian

The demand for engineers is measured by employment. In 2001, the demand for engineerswas 232,700 and increased on average by 4.8% per annum through to 2010. This growthequalled average annual growth in the supply of engineers, and increased demand to352,900 in 2010. Given the size of the engineering population, the demand for, and supply ofengineers are balanced by the labour force participation rate and the unemployment rate.


32/88



Figure 3.1 examines how growth in the supply of engineers compares to the growth in thesupply of non-engineering skilled labour10 and growth in labour supply generally in Australia.Figure 3.1 shows that the supply of skilled labour generally grew much faster than totallabour supply. The population with non-engineering skills grew faster than the engineeringpopulation and had an average annual growth rate of 5.0%.

70.0

75.0

80.0

85.0

90.0

95.0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Lab

ourforceparticipationrate(%)

Figure 3.2: Engineering labour force participation compared to non-

engineering skills and all labour in the Australian economyEngineering Non-engineering All labour

Figure 3.2 illustrates a key difference between the three groups examined in Figure 3.1.Labour force participation is typically higher for skilled groups than for the population ingeneral, but the labour force participation rate in engineering is significantly higher than fornon-engineering skills. Over the past decade, non-engineering skills labour forceparticipation has been close to its average of 86.2%. But in engineering, average labourforce participation was 4.0% higher and more variable (see Table 3.2). Comparison of the

participation rate and the unemployment rate suggest that engineering labour forceparticipation has responded to labour market conditions, falling as unemployment rises andrising as unemployment falls. Higher labour force participation in engineering meant thatengineering labour supply growth was comparable to growth in the supply of non-engineeringskills even though the latter had higher average annual population growth.

Figure 3.3 shows the growth in labour demand that corresponds to the labour supply growthin Figure 3.1. In broad terms the relationship between labour demand for the three groups issimilar to what was shown in the labour supply illustration. The higher variability in thedemand for engineers is quite evident and helps to confirm the view that the engineeringlabour market is responsive to labour market conditions to some extent.

As well as changes in the labour force participation rate, labour market adjustment isreflected in changes in the unemployment rate. Figure 3.4 shows the trends inunemployment rates corresponding to the supply and demand conditions illustrated inFigures 3.1 and 3.3. Figure 3.4 confirms the view that skilled individuals in generalexperience lower unemployment than others in the labour market. Figure 3.4 also shows thatengineering unemployment was above non-engineering unemployment for most of thedecade. It was only in 2008, anecdotally a year of acute engineering skills shortages, that theengineering unemployment rate fell below the non-engineering rate. The higher variability inengineering unemployment is also evident in Figure 3.4 with the unemployment rateincreasing in 2001 and 2002 and remaining high in 2003 when general unemploymentcontinued to fall and there was little change in non-engineering unemployment.

10Non-engineering skills are defined as individuals with qualifications comparable in level with the requirements

for the engineering team but in a non-engineering discipline.


33/88



90

100

110

120

130

140

150

160

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

INDEXNUMBER(2001=100)

Figure 3.3: Growth in the demand for engineers, non-engineering skilledlabour and total labour in Australia

Engineering Non-engineering Australian

2.0

3.0

4.0

5.0

6.0

7.0

8.0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

%

Figure 3.4: Trends in the unemployment rates for engineering, non-engineering skills and the overall Australian labour market

Engineering Non-engineering Australian

Table 3.2: Comparing labour force par ticipation and unemployment rates for the engineering, skilled non-engineering

and overall Australian labour forces

YEAR Participation (%) Unemployment (%) Participation (%) Unemployment (%) Participation (%) Unemployment (%)

2001 75.0 6.9 85.9 3.2 88.4 3.9

2002 74.9 6.4 86.3 3.3 90.4 4.3

2003 75.7 6.2 85.7 3.4 90.5 4.1

2004 75.5 5.6 85.8 3.1 88.9 3.4

2005 77.1 5.3 86.6 2.8 89.6 3.1

2006 77.4 5.0 86.5 2.5 91.0 3.1

2007 77.6 4.3 86.8 2.4 90.4 2.7

2008 78.1 4.4 85.6 2.5 91.5 2.4

2009 78.8 6.0 86.8 3.6 91.2 4.1

2010 78.2 5.3 86.3 3.0 90.1 3.7


Australia overall Non-engineering skills Engineering

The reaction of engineering unemployment to the GFC (increase of 71%) was proportionallyhigher than non-engineering (increase of 44%) and the overall labour market (increase of36%). As will be shown in chapter 7, one reason why the engineering unemployment raterecovery in 2010 was less than the two other groups was a record permanent migrant intake,

but this does not explain why the unemployment rate increase was so high or why it seemsto be a recurring phenomenon.


34/88


The influence of immigration 25

3.3 Employment in engineering occupations

The previous chapter distinguished between employment of the engineering labour force inengineering as compared to non-engineering occupations. EWS statistics on aggregateemployment in engineering occupations are available from 2007 onwards and Table 3.3compares them to engineering labour supply and engineering labour demand11.

Table 3.3: The engineering labour force employed in engineering occupations ('000)

Engineering

Year Labour supply Labour demand Employed in engineering occupations (%)

2007 324.40 315.50 175.3 54.0

2008 345.00 336.80 197.4 57.2

2009 356.50 341.80 193.8 54.4

2010 366.60 352.90 213.2 58.2


Engineering

In 2007, 54% of the engineering labour force was employed in one of the 51 ANZSCOengineering occupations identified in the research referenced in chapter 2. In 2008, thisshare increased to 57.2% but the global financial crisis saw it fall back to 54.4%, beforeincreasing to 58.2% in 2010. The shares of the engineering labour force employed inengineering occupations in the Table are in line with estimates from census statistics, butbecause there are only four years of EWS statistics available, conclusions about trends arenot feasible.

What Table 3.3 clearly shows is that when there is excess demand (skill shortages) forengineers, policy design is complicated by the competition between engineering and non-engineering occupations for the available supply of engineers. Employment in engineeringfell between 2008 and 2009 when the overall demand for engineers increased. Theimplication is that part of the answer to overcome engineering shortages is to address thevariability in engineering employment because once engineers leave engineering it is difficult

to attract them back.

Table 3.4: The employed engineering labour force by country of origin

Year Overseas born Australian born Total O/seas born (%)

2001 97.3 135.4 232.7 41.8

2002 120.4 142.2 262.6 45.8

2003 136.9 136.6 273.5 50.1

2004 122.3 148.0 270.3 45.2

2005 127.2 156.1 283.3 44.9

2006 136.5 156.8 293.3 46.5

2007 154.5 161.0 315.5 49.02008 169.9 166.9 336.8 50.4

2009 166.8 175.0 341.8 48.8

2010 185.7 167.3 352.9 52.6


3.4 The influence of immigration

Chapter 2 noted that immigration has been a feature of the engineering labour force for sometime. Table 3.4 considers how the Australian and overseas born components of theemployed engineering labour force have changed over the last decade. The analysis is in

11See Engineers Australia, The Engineering Profession, op cit


35/88


The influence of immigration 26

terms of employment rather than labour supply because a choice of one

The Engineering Profession Eighth Edition 2011

Documents

Transcript of The Engineering Profession Eighth Edition 2011