Good Engineering Talent is Still Hard to Find

As companies reemerge from a year-plus of pandemic-induced work changes, finding and retaining qualified engineering talent continues to be a major challenge as skill shortages persist and companies place a premium on new competencies.

According to the 42^nd annual Deltek Clarity Architecture & Engineering study, the industry is grappling with a talent shortage along with an array of other human capital management issues exacerbated by the furloughs, layoffs, and in many cases, stalled hiring brought about by the COVID-19 pandemic. The switch to a remote and distributed workforce up-ended traditional workforce management practices, the study found, while creating new obstacles for sourcing and onboarding talent.

In fact, finding and retaining qualified talent is the top challenge for 54% of survey respondents in the AE sector along with the ability to offer competitive compensation (53%). As a result of the pandemic, 30% of AE firms instituted salary freezes or salary reductions and only 26% offered year-end bonuses and promotions, weakening their ability to attract and retain engineers with in-demand and hard-to-find skills.

Talent acquisition continues to be stymied by the availability of strong candidates, the survey found—a trend that’s accelerating as the workforce becomes more open to exploring new opportunities in the coming year. Thirty-three percent of firms responding to the Deltek Clarity AE industry survey reported having more open positions than last year as the pandemic wanes, turning the emphasis to active recruiting and retention.

Part of the problem lies with an-going skills gap: The U.S. workforce doesn’t have enough workers and skilled candidates to fill an ever-increasing number of high-skilled jobs like those in the engineering sector. A recent survey of employers by SHRM found that 83% of respondents are having difficulty finding suitable candidates to hire. The American Action Forum attributes the gap in part to demographic shifts like an aging workforce and decreasing participation rates in the labor force as well as shortfalls caused by insufficient education and skills development.

The American Society of Mechanical Engineers (ASME) supports these conclusions, making a case for engineers to upskill and embrace continuous life-long learning to strengthen their skills for the post-COVID-19 era. With the industry embracing new Industry 4.0 technologies like AI, robotics, the Internet of Things (IoT), 3D printing, and other advances, demand for specialized skills is rising, not decreasing. ASME sites a Deloitte study that estimates that 2.4 million jobs would remain unfilled in the manufacturing sector between 2018 and 2028 with an estimated impact of $2.5 trillion. ASME directors make the case that engineers are graduating with textbook knowledge of fundamentals and theory, but many lack the applied knowledge skills for advancing day-to-day  work, which is only adding to the engineering and tech talent sourcing and skills gap challenges.

Retiring baby boomers and an in-coming workforce of younger workers who place a premium on flexibility is also changing the dynamics for recruiting and attracting an engineering workforce. On the one hand, the younger generation of employees are prioritizing flexibility and more meaningful total life experiences, not just work experiences, which increases the pressure on companies to finetune benefits programs and institute enhanced remote and hybrid work practices. On the other hand, the shift to remote and flexible workplace policies will expand companies’ recruitment reach, aiding in talent acquisition.

“During the pandemic, firms that weren’t prepared to support a distributed workforce or are now starting to require employees to return to the office may be at a competitive disadvantage in talent acquisition,” notes Megan Miller, product marketing director at Deltek. “On the opposite end of the spectrum, firms that are offering more flexible work options will not only be more attractive to potential candidates, but those companies can potentially expand their recruiting efforts more broadly to reach candidates that were previously not interested in new opportunities or were outside of their geographic reach.”  In fact, three quarter of companies responding to this year’s report said they plan to offer more flexible work options moving forward and more than half are developing new remote working policies to better support the changing workplace, Miller says.

That’s a positive trend as employees desire for workplace culture is adding to the complexity of finding and attracting talent. “Candidates may be looking for employees that focus on career mobility, workplace flexibility, additional mental health benefits, work-life balance, diversity and inclusion initiatives,” Miller adds. “The desired benefits will depend on the candidate.”

For engineers looking to capitalize on the moment to maximize career opportunities, Miller advises taking a more active role in owning their career development and to avoid getting caught up in the salary wars. “People need to pay attention to the culture of the firm, career development opportunities, and benefits that align best with their needs, she explains. “The salary increase may come at a price to one of those other areas.”

For a deep dive into the report, check out this video.