THE ENGINEERING PROFESSION: A STATISTICAL OVERVIEW. Eleventh Edition, October 2014

Transcription

1 THE ENGINEERING PROFESSION: A STATISTICAL OVERVIEW Eleventh Edition, October 2014

2 The Engineering Profession: A Statistical Overview, ELEVENTH edition, AUGUST 2014 ISBN Author: Andre Kaspura [email protected] Institution of Engineers Australia 2014 All rights reserved. Other than brief extracts, no part of this publication may be reproduced in any form without the written consent of the publisher. The report can be downloaded at Public Relations and Marketing Engineers Australia 11 National Circuit, Barton ACT 2600 Tel: [email protected]

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4 CONTENTS Chapter 1 Introduction 1 Main Points Engineers and Engineering Objective of the Statistical Overview The Engineering Team Data Sources and Caveats What s New in this Edition? 4 Chapter 2 The Engineering Labour Market 6 Main Points The Supply of Qualified Engineers The Demand for Qualified Engineers Retention in Engineering Unemployment Labour Force Participation Types of Engineering Qualifications Distribution between States and Territories 10 Chapter 3 Skilled Migration 13 Main Points Country of Origin and the Engineering Labour Market Sources of Australia s Migrant Engineers Australia Retention in Engineering Occupations Proficiency in Spoken English 21 Chapter 4 Transition from School to Engineering Education 22 Main Points Year 12 Mathematics and Science Studies Completion of Year 12 Mathematics and Science Basis of Admission to Bachelor Degrees Transition from School to University Engineering Courses 28 Chapter 5 University Engineering Education 30 Main Points Course Commencements Enrolments in Engineering Courses Course Completions Annual Retention Rates for Bachelor Degrees The Engineering Share of Course Completions State and Territory Shares of Bachelor Degree Completions 42 Chapter 6 Supply and Education 45 Main Points What is Included in Statistics Labour Market Choices of New Graduates Engineering Technologists Professional Engineers New Degree Qualified Engineers Associate Engineers 52 Engineers Australia ii

5 6.7 Annual Additions to the Engineering Team 54 Chapter 7 Supply and Skilled Migration 56 Main Points Australia s Skilled Migration Policy Assessing Overseas Engineering Qualifications Trends in Skilled Migration of Engineers Permanent Visas Temporary Visas 60 Chapter 8 Industry Distribution of Engineers 64 Main Points Industries and Industry Statistics Employment at Industry Group Level Industries with Large Engineering Employment 68 Chapter 9 Geographic Location 74 Main Points The ABS Approach to Geographic Statistics New South Wales Victoria Queensland South Australia Western Australia Tasmania The Territories 77 Chapter 10 Engineering Specialisations 83 Main Points Engineering Courses and Engineering Specialisation Broad Specialist Areas of Engineering Detailed Engineering Streams 86 Chapter 11 Average Ages and Age Structure 89 Main Points Average Ages of Engineers Age Structure and how it has changed Age and Labour Force Participation 93 Chapter 12 Experience, Remuneration and Age 95 Main Points The Framework Employed Length of Experience Average Ages Salary Movements 102 Chapter 13 Change Indicators for the Engineering Labour Market 106 Main Points The Need for Change Indicators Trends in Engineering Construction 107 Engineers Australia iii

6 13.3 Vacancies for Engineers Recruitment Difficulties Survey 111 Chapter 14 The Engineering Labour Market in Main Points Assessing the Engineering Labour Market Changes in the Supply of Engineers Changes in the Demand for Engineers 116 Engineers Australia iv

7 LIST OF TABLES Chapter 2 Table 2.1: The Engineering Labour Markets in 2006 and Table 2.2: Comparative Statistics for States and Territories 11 Chapter 3 Table 3.1: The Engineering Labour Market in 2006 and Table 3.2: The Regions of Origin of Overseas Born Engineers 16 Chapter 5 Table 5.1: Domestic Students Commencing Engineering and Related Technology Courses 32 Table 5.2: Overseas Students Commencing Engineering and Related Technology Courses 32 Table 5.3: Students Commencing Engineering and Related Technology Courses, by Country of Domicile 33 Table 5.4: Students Commencing Engineering and Related Technology Courses, by Gender 33 Table 5.5: Domestic Students Enrolled in Engineering and Related Technology Courses 35 Table 5.6: Overseas Students Enrolled in Engineering and Related Technology Courses 35 Table 5.7: Students Enrolled in Engineering and Related Technology Courses, by Country of Domicile 36 Table 5.8: Students Enrolled in Engineering and Related Technology Courses, by Gender 36 Table 5.9: Domestic Students Completing Engineering and Related Technology Courses 38 Table 5.10: Overseas Students Completing Engineering and Related Technology Courses 38 Table 5.11: Students Completing Engineering and Related Technology Courses, by Country of Domicile 39 Table 5.12: Students Completing Engineering and Related Technology Courses, by Gender 39 Table 5.13: Annual Retention Rates for Bachelor Degree Students, in Engineering And in Institution 40 Chapter 6 Table 6.1 Domestic Students Completing Three Year Bachelors Degrees in Engineering 48 Table 6.2 Domestic Students Completing Four Year Bachelors Degrees in Engineering 49 Table 6.3 Domestic Students Completing Four Year Bachelor Double Degrees in Engineering 50 Table 6.4 Domestic Students Completing Bachelors Degrees in Engineering, All Durations 51 Table 6.5 Domestic Students Completing Associate Degrees and Advanced Diplomas in Engineering at Universities 52 Table 6.6 Completions of Associate Degrees and Advanced Diplomas in Engineering from Australian TAFE Colleges 54 Engineers Australia v

8 Table 6.7 Annual Changes in the Engineering Team from Course Completions by Citizens and Permanent Residents 53 Chapter 7 Table 7.1 An Overview of Skilled Migration of Engineers to Australia 58 Table 7.2 Engineering Specialisations Granted Permanent Migration Visas 60 Table 7.3 Temporary Visas Granted to Engineers on the SOL in the Skilled Migration Program 62 Chapter 8 Table 8.1 Engineering Employment in the Context of General and Skilled Employment, 2006 and Table 8.2 Annual Growth in General, Skilled and Engineering Employment, 2006 and Chapter 9 Table 9.1: The Distribution of the Engineering Labour Force Throughout NSW, Table 9.2: The Distribution of the Engineering Labour Force throughout Victoria, Table 9.3: The Distribution of the Engineering Labour Force Throughout Queensland, Table 9.4: The Distribution of the Engineering Labour Force Throughout South Australia, Table 9.5: The Distribution of the Engineering Labour Force Throughout Western Australia, Table 9.6: The Distribution of the Engineering Labour Force Throughout Tasmania, Chapter 10 Table 10.1: The Engineering Labour Force, Broad Streams of Engineering Education, 2006 and Table 10.2: The Engineering labour Force, Detailed Streams of Engineering Education, Table 10.3: The Engineering labour Force, Detailed Streams of Engineering Education, Chapter 11 Table 11.1 The Average Age of the Engineering Labour Force 90 Table 11.2 The Age Structure of the Engineering Labour Force, 2006 and Chapter 12 Table 12.1 Average Experience of Private Sector Professional Engineers 97 Table 12.2 Average Experience of Public Sector Professional Engineers 97 Table 12.3 Average Age of Private Sector Professional Engineers 99 Table 12.4 Average Age of Public Sector Professional Engineers 100 Table 12.5: The Average Age of Professional Engineers 102 Table 12.6 Average Salary Packages for Professional Engineers in the Private Sector 102 Table 12.7 Average Salary Packages for Professional Engineers in the Public Sector 103 Table 12.8 Average Growth in Professional Engineer Salary Packages 104 Engineers Australia vi

9 Chapter 11 Table 11.1 Difficulties Experienced in Recruiting Engineers 93 Table 11.2 The Consequences of Difficulties Recruiting Engineers 94 Engineers Australia vii

10 LIST OF ILLUSTRATIONS Chapter 2 Figure 2.1: Engineering Qualifications and Retention in Engineering, Figure 2.2: Comparative Annual Growth Rates for the Supply and Demand for Qualified Engineers in States and Territories 11 Chapter 3 Figure 3.1: Unemployment Rates in 2011 of Overseas Born Qualified Engineers by Time of Arrival in Australia 17 Figure 3.2: Overseas Born Qualified Engineers in 2011, Region of Birth and Time of Arrival in Australia 18 Figure 3.3: Unemployment Rates in 2011 for Overseas Born Qualified Engineers, Region of Birth 19 Figure 3.4: The Proportion of Overseas Born Qualified Engineers Employed in Engineering Occupations in 2011, By Arrival in Australia 20 Figure 3.5: Proportion of Overseas Born Qualified Engineers Employed in Engineering Occupations, By Region of Birth 20 Figure 3.6: The Proportion of Overseas Born Qualified Engineers Who Assessed their Spoken English as Very Well or Well in Chapter 4 Figure 4.1: Year 12 Participation in Mathematics 22 Figure 4.2: Year 12 Participation in Physics and Chemistry 23 Figure 4.3: Year 12 Participation in Science 23 Figure 4.4: Year 12 Course Completions by Subjects 24 Figure 4.5: Trends in the Completion of Year 12 Mathematics Courses 25 Figure 4.6: Trends in the Completion of Year 12 Science Courses 25 Figure 4.7: The Basis for Admission to Bachelor Degrees, Domestic Students 27 Figure 4.8: The Basis for Admission to Bachelor Degrees, Overseas Students 27 Figure 4.9: Applications for, Offers Made and Acceptances of Places in University Engineering Courses, 2001 to Figure 4.10: Offers Made by Universities by ATAR Scores, Chapter 5 Figure 5.1: The Share of Overseas Students in Engineering Compared to All Course Completions 41 Figure 5.2: The Engineering Share of Doctoral Degree Completions 41 Figure 5.3: The Engineering Share of Coursework Masters Degree Completions 41 Figure 5.4: The Engineering Share Of Bachelors Degree Completions 42 Figure 5.5 Jurisdictional Shares of Completions of Bachelor Degrees in Engineering, Domestic Students 43 Figure 5.6 Jurisdictional Shares of Completions of Bachelor Degrees in Engineering, Overseas Students 43 Chapter 6 Figure 6.1: The Destination of New Engineering graduates Compared to New Graduates in General, 2009 to Engineers Australia viii

11 Figure 6.2: The Annual Flow into the Engineering Team from Course Completions by Citizens and Permanent Residents 55 Chapter 7 Figure 7.1 Skilled Migration Visas Granted to Engineering SOL Occupations 58 Figure 7.2 Permanent Visas Granted to Engineering Occupations 59 Figure 7.3 Temporary 457 Visas Granted to Engineering Team Occupations 61 Chapter 8 Figure 8.1 Employment of Qualified Engineers in Engineering Occupations in Industries that Employ at least 1,000 Engineers 68 Chapter 11 Figure 11.1 The Age Structure of the Engineering Labour Force in 2011 And how it has changed since Figure 11.2 The Age Structure of Engineers in Engineering Occupations in 2011 And how it has changed since Figure 11.3 Labour Force Participation of Engineers and Age Structure 93 Figure 11.4 The Age Profile of Labour Force Participation in Engineering Compared to All Skilled Areas, Chapter 12 Figure 12.1 Comparing Work Experience of Professional Engineers in the Private and Public Sectors 98 Figure 12.2 Change in Average Experience Levels for Private Sector Professional Engineers 98 Figure 12.3 Change in Average Experience Levels for Public Sector Professional Engineers 98 Figure 12.4 Average Ages of Professional Engineers in the Private and Public Sectors 100 Figure 12.5 Average Ages of Professional Engineers in the Private Sector 101 Figure 12.6 Average Age of Professional Engineers in the Public Sector 101 Figure 12.7 Trends in Engineering Salaries compared to Full Time Adult Earnings 104 Chapter 13 Figure 13.1 Trends in National Economic Infrastructure and Total Engineering Construction Work Done 107 Figure 13.2 Annual Growth Economic Infrastructure Components, Past Decade, Past Five Years and Last Year 108 Figure 13.3 Annual Growth Components of Resources and Other Engineering Construction, Past Ten Years, Past Five Years and last Year 108 Figure 13.4 The Pipeline of Engineering Construction on Economic Infrastructure Australia 109 Figure 13.5 The Pipeline of Engineering Construction in the Resources And Other Sectors 109 Figure 13.6 Trends in Vacancies for Professionals, Engineers and Vacancies in General, Australia, January 2006 to August Figure 13.7 Monthly Changes in Vacancies for Engineers, Past Two Years, Past Year and past Three Months 110 Engineers Australia ix

12 Figure 13.8 Respondents who Experienced Difficulties Recruiting Engineers during the Past Twelve Months 111 Figure 13.9 Recruiting Difficulties Experienced by Grade Sought in 2013 Compared to the Medium Term Average 112 Figure Recruiting Difficulties Experienced by Location Compared to the Medium Term Average 112 Figure Difficulties Experienced Recruiting Engineers in 2013 Compared to the Medium Term Average 112 Figure The Consequences of Recruiting Difficulties Experienced in 2013 Compared to the Medium Term Average 113 Figure Expectations of Future Recruiting Difficulties 113 Engineers Australia x

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14 Chapter 1: Introduction Main Points This Chapter describes the educational qualifications necessary to be part of the engineering team in Australia. The role of the Statistical Overview in piecing together fragmented labour market statistics on engineers and engineering is briefly discussed and key definitions used throughout the Report are explained. This edition updates statistics on trends in education, skilled migration and the characteristics of engineers. New material drawing out changes in the engineering labour force between the 2006 and 2011 is included in the Overview for the first time. Key topics include changes in the engineering labour market overall; changes brought about through skilled migration; a detailed review of industry distribution, including a ranking of the 50 largest industries by the number of qualified engineers employed and an analysis of the ages and age structure of engineers. 1.1: Engineers and Engineering Engineers and engineering are indispensable contributors to Australian prosperity and lifestyles. Engineering services are embodied in almost every good or service consumed or used by Australians, now and in the future. In this respect, engineers are the enablers of productivity growth through their role in converting brilliant ideas into new products, new processes and new services. Engineers also ensure that society gets the most out of existing facilities through optimising their operations and maintenance. Fully competent engineers hold accredited academic credentials in engineering and have then satisfactorily completed a process of professional formation that bridges the gap between academic studies and engineering practice. The time necessary to become an engineer is very long, academic studies are specific and highly analytical and the skills of engineering practice are vital to successful outcomes for the individual and society. Engineering is not homogeneous and there are numerous areas of engineering practice. To some degree specialisation begins with academic studies, for example, students can choose between degrees in mechanical engineering, civil engineering or electrical engineering. Most specialisation, however, takes place during the process of professional practice, for example, a graduate with a degree in civil engineering can choose to practice as a structural engineer, a geotechnical engineer, a coastal engineer or as a civil engineer. More detail on engineering specialisations can be found at Engineering skills and expertise are unique and cannot be substituted by skills and expertise offered by other professions. When engineers are over-ruled by others or when engineering decisions are not based on engineering designs and judgment, outcomes will be problematic. This has become particularly evident in areas where incremental cost cutting has reduced or eliminated engineering positions. The costs of some more dramatic examples have been highlighted in reports by auditorsgeneral 1. However, the training and experience of engineers offers transferable skills that are highly valued in many other fields of work. As a consequence qualified engineers are found in most occupations in the Australian economy, and, as demonstrated by the Statistics in Chapter 2, only about 60 to 62% are employed in recognised engineering occupations. The remainder are employed in a wide range of analytical and problem solving work outside engineering. Recognising means that retention of trained individuals in engineering is as important as growing the number of individuals with engineering qualifications. 1 See for example Engineers Australia 1

15 1.2: Objective of the Statistical Overview Engineers Australia was formed to advance the science and practice of engineering for the benefit of the community. Engineers Australia sets and maintains professional standards for its members consistent with international benchmarks, encourages the development of engineering knowledge and competencies, facilitates the exchange of ideas and information and informs community leaders and decision makers about engineers and engineering issues. This objective can best be achieved through the dissemination of factual information about engineers and about broader policy issues that involve engineering. The Statistical Overview contributes to these efforts by articulating statistics about the number of engineers in Australia, how many of them are engaged in engineering work and where, how and the circumstances of their work. The reason the Statistical Overview is necessary stems from the fragmented nature of Australian statistics dealing with a specific profession. At the macroeconomic level, high quality statistics to assist labour market policy decisions are available monthly. But, there are severe limitations in applying these statistics to the analysis of a profession, primarily because they do not provide for the educational qualifications essential for entry to the profession. Some have chosen to ignore these limitations and have extended the application of statistics intended for macroeconomic purposes to the disaggregated requirements associated with changes in engineering 2. Unfortunately, comparing apples and oranges has never been a satisfactory basis for policy analysis. The interests of Engineers Australia are best served by compiling statistics that represent the engineering profession as closely as possible and that begins by ensuring that those included in statistical counts are actually qualified to be considered part of the profession. This objective can be achieved, to varying degrees, by building on several sources of official statistics, and some unofficial sources, within the structures of well-known labour market definitions, employing as far as possible the statistical classifications of Australia s official statistical agency the Australian Bureau of Statistics (ABS). The Statistical Overview has employed an incremental approach improving and refining statistics and adding new ones each edition. The framework for arranging statistics is a simple stock formulation; the opening stock plus additions less losses is the closing stock. The collection is far from complete and several important gaps remain, notably statistics on the retirement of older engineers. However, improvements continue to be made so that the Statistical Overview represents a comprehensive and consolidated collection of Australian statistics on engineers and engineering. 1.3: The Engineering Team In Australia the engineering profession is organised into the engineering team. The engineering team comprises Professional Engineers, Engineering Technologists and Engineering Associates. The three groups are differentiated by educational qualifications, which in conjunction with the process of professional formation undertaken, shape the engineer s degree of conceptualisation and independent decision-making and so determine the complementarity between the groups in engineering practice. In detail, the roles of the three groups are: Professional Engineers apply lifelong learning, critical perception and engineering judgment to the performance of engineering services. Professional Engineers challenge current thinking and conceptualise alternative approaches, often engaging in research and development of new engineering principles, technologies and materials. Professional Engineers apply their analytical skills and well developed grasp of scientific principles and engineering theory to design original and novel solutions to 2 See for example the Issues Paper released by the Australian Workplace and Productivity Agency (AWPA) in support of their study of the engineering labour force, Engineers Australia 2

16 complex problems. Professional Engineers exercise a disciplined and systematic approach to innovation and creativity, comprehension of risks and benefits and use informed professional judgment to select optimal solutions and to justify and defend these selections to clients, colleagues and the community. Professional Engineers require at least the equivalent of the competencies in a four year full time Bachelor s Degrees in engineering. Engineering Technologists exercise ingenuity, originality and understanding in adapting and applying technologies, developing related new technologies or applying scientific knowledge within their specialised environment. The education, expertise and analytical skills of Engineering Technologists equip them with a robust understanding of the theoretical and practical application of engineering and technical principles. Within their specialisation, Engineering Technologists contribute to the improvement of standards and codes of practise and the adaptation of established technologies to new situations. Engineering Technologists require at least the equivalent of the competencies in a three year full time Bachelor Degree in engineering. Engineering Associates apply detailed knowledge of standards and codes of practice to selecting, specifying, installing, commissioning, monitoring, maintaining, repairing and modifying complex assets such as structures, plant, equipment, components and systems. The education, training and experience of Engineering Associates equip them with the necessary theoretical knowledge and analytical skills for testing, fault diagnosis and understanding the limitations of complex assets in familiar operating situations. Engineering Associates require at least the equivalent of the competencies in a two year full time Associate Degree in engineering or a two year full time Advanced Diploma in engineering from a university or TAFE college. Engineers Australia believes that formal qualifications in engineering are the first step towards becoming a competent practicing engineer. Demonstrating professional competence is common to the professions, but engineering differs in the process used. Other professions typically employ formal off-the-job training, often in conjunction with formal examinations. In engineering, the process of professional formation is entirely an on-the-job process over three to four years concluding with a formal assessment of skills and competencies acquired against sixteen documented and internationally recognised criteria. An important reason for an on-the-job process is that specialisations in engineering practice primarily occurs at this stage and the practicalities of alternative processes given the large number of engineering specialisations. Many professions, like doctors, lawyers or accountants, are regulated by governments and practitioners are unable to operate unless registered. Registration in these cases verifies that individuals have the necessary educational qualifications, have satisfied the standards necessary to be admitted to practice adhere to an appropriate code of ethical conduct and are subject to legal sanction if they practice unethically or negligently. Similar registration provisions apply to common trades like plumbers and electricians. Unfortunately, in Australia there are no similar registration provisions for engineers, except in Queensland. An important function of Engineers Australia is set up and administer arrangements equivalent to expectations in a legislated registration system. Of course, membership of Engineers Australia is entirely voluntary and these arrangements carry no force with non-members. Engineers Australia sees this as a major source of vulnerability for the Australian economy. 1.4: Data Sources and Caveats The three primary sources of official statistics used in the Statistical Overview are the Australian Bureau of Statistics (ABS), the Department of Education (DE) and the Department of Immigration and Border Control (DIBC). The ABS is the official Australian statistical agency and as such is responsible for statistical classification systems and these are used by the other agencies mentioned. From time to time, Engineers Australia 3

17 ABS classification systems change and time delays in the adoption of new systems can cause differences between agencies. There are no such problems at present. This apparent straight-forward situation does contain some inherent limitations. The most notable one being classification of individuals according to their highest qualification. Thus, a practicing engineer who holds an MBA as well a Bachelor degree in engineering is counted as belonging to the field of their highest qualification. Other minor issues have been canvased in earlier editions. The ABS is the source for census statistics covered in the Statistical Overview. These statistics are extracted by Engineers Australia using the ABS TableBuilder facility. The Department of Education is the primary source for higher education statistics and the Department of Immigration and Border Control is the primary source for statistics on skilled migrants granted visas. Limited statistics on TAFE completions are extracted from the National Centre for Vocational Education Research (NCVER) Vocstats system. Non-official statistics are sourced from a number of sources. For the last eight years, Engineers Australia has included several questions on recruiting difficulties experienced by engineering employers in an annual salaries survey conducted by its subsidiary, Engineers Media. This survey is appropriate because survey respondents, HR managers and business principals, are likely to be better informed about recruiting difficulties than individual engineers. On the other hand, statistics on the characteristics of engineers are better reflected in statistics collected by Professions Australia whose survey respondents are individual engineers. Graduate Careers Council statistics are used to inform the progress of new engineering graduates. Unfortunately, these sources do not employ ABS classification systems, complicating comparisons with other statistics. Engineering is a profession and not simply an occupation; how an engineer is qualified and what he/she does with the knowledge acquired are both important. In the Statistical Overview, two measures are used in conjunction. In the first measure conventional labour force definitions are combined with the educational qualifications essential for inclusion in the engineering team. This measures the engineering labour force or the supply of individuals who are qualified to be engineers. The second measure is more complex and seeks to answer the question; how many individuals in the engineering labour force work in occupations recognised as involving engineering work? This measure was derived from research by Engineers Australia which identified 52 of 358 four-digit ANZSCO occupations as engineering occupations 3. These occupations are not constrained by narrow occupational nomenclature but recognise the wide range of work that engineers are engaged in and recognise the range of occupations that engineers move through from initial graduation to retirement. This measure can be thought of as a measure of the number of individuals who have engineering qualifications retained in engineering work. In many situations the ratio of the two measures is employed as a simplification. From the policy perspective, the number of individuals with recognised engineering qualifications is important, but when employers experience engineering skill shortages, their complaints relate to the numbers of qualified individuals willing and able to work in engineering occupations. 1.5: What s New in this Edition? Following the pattern of past years, time series statistics on university applications, offers and acceptances, university education, TAFE completions, skilled migration, experience levels, salary packages and age are updated. These include some disaggregated statistics within the limits of what is available. Some new time series material has become available through the cooperation of the Australia Council of Engineering Deans. This includes a new section 4.3 on the basis of admission to Bachelor degree 3 Engineers Australia, The Engineering Profession in Australia; A Profile from the 2006 Population Census, September 2010, Engineers Australia 4

18 courses and a new section 5.4 on annual retention in Bachelor degrees in engineering. Engineers Australia expresses its thanks to the Deans for this material. Additional time series material from the Graduate Careers Council on the labour market choices made by new graduates has been included in a new section 6.2. In 2012, the Statistical Overview included for the first time statistics from the 2006 and 2011 population censuses undertaken by the ABS. This material provided important information on the structure of the engineering labour force and how it changed between those years. In 2013, new structural material looking in detail at the characteristics of overseas born engineers and the industry distribution of engineers was added. The latter included a list of the detailed industries that employ the most engineers in order of employment size. This year we have added further to the structural material by including a new Chapter 9 that deals with the geographic distribution of engineers in major regions within States and Territories. There is also a new Chapter 10 that looks at specialisation in engineering. Other changes made this year include a major reorganisation of the material covering the experience, salary packages and ages of professional engineers and a new approach to analysing how the age structure of the engineering labour market changed between 2006 and The most important difficulty encountered from the start of this project remains; there are no contemporary, reliable and readily available statistics on labour market changes. To compensate we have had to make do with alternative indicators. This year these have been reorganised into a new Chapter 13 on change indicators. A new Chapter 14 then brings together what we know about changes in supply and changes in demand to assess the status of the engineering labour market in Engineers Australia 5

19 Chapter 2: The Engineering Labour Market Main Points This Chapter considers the size of Australia s engineering labour market and how it changed between 2006 and When considering this topic it is important to differentiate between the number of people with acceptable qualifications in engineering and how many of them are employed in engineering. The number of people with acceptable engineering qualifications active in the labour market, otherwise known as the supply of qualified engineers, grew by 5.6% per year to 263,890 while employment, or demand, grew a little slower, 5.5% per year, to 254,515. This difference meant that more qualified engineers were unemployed in 2011 than in 2006, increasing from 6,045 to 9,375 and the unemployment rate increased from 3.0% to 3.6%. Growth rates for the supply and demand of women engineers were higher than for men; for women, supply grew by 8.0% per year and demand by 7.8% per year; for men, these figures were 5.3% per year and 5.2% per year, respectively. Unemployment rates were considerably higher for women engineers than for men; 5.1% compared to 2.8% in 2006 and 6.1% compared to 3.2% in The proportion of women qualified engineers increased from 10.6% to 11.8% in Retention of qualified engineers in engineering occupations, or the proportion of the supply of engineers engaged in engineering occupations, increased from 60.9% in 2006 to 62.1% in This small change in the proportion masked the more rapid increase in demand for this segment than the supply of engineers. Demand for qualified engineers in engineering occupations increased by an average 6.0% per year compared to 5.6% per year for the supply of engineers. As a result the number of qualified engineers employed in engineering occupations increased from 122,258 to 163,912 in The level of retention and how it changes has important policy implications. Ultimately, the availability of people with engineering qualifications determines growth in the profession giving rise to policies in higher education and skilled migration. However, the essence of engineering is the work undertaken in engineering occupations and rates of retention in engineering demonstrate that a much smaller group is involved. This points to the importance of policies to retain more engineers in engineering to avoid future skill shortages. The reasons why qualified engineers leave engineering for alternative work are complex and are not yet fully understood. Retention varies between groups in the engineering labour market; including between genders with retention of women lower than men and between Australian and overseas born engineers with the latter exhibiting much lower retention. Possible causes of low retention are personal choices in highly competitive professional labour markets and inability to find opportunities in engineering due to intermittency in engineering employment, lack of career options or general labour market conditions. The mix of engineering qualifications held by qualified engineers has been fairly stable over time. Unemployment experience does not appear to be influenced by qualifications. However, retention in engineering increases with the level of qualifications, being highest for engineers with Doctoral degrees and lowest for engineers with Associate Degrees or Advanced Diplomas. There are marked differences and some similarities between States and Territories. Growth in demand for, and supply of, engineers was highest, and well above national averages, in the resource States of Western Australia and Queensland and in the Northern Territory. The shares of women engineers was highest in the two largest States, NSW and Victoria, and below national average in remaining jurisdictions. Conversely, retention in engineering was lowest in the two largest jurisdictions and highest in areas where demand growth was high and in the smaller jurisdictions. Engineers Australia 6

20 2.1: The Supply of Qualified Engineers The supply of qualified engineers, or the engineering labour force, is the number of individuals with educational qualifications consistent with the engineering team, who are actively engaged in the labour market, either by being employed, or if unemployed, actively seeking work. Often the supply of qualified engineers is referred to as the supply of engineers, a convenient short form. In 2006, the supply of engineers was 200,615; 179,448 men and 21,167 women. Table 2.1 shows that by 2011, the supply of engineers had increased to 263,890, an increase of 63,275 or 31.5%, equivalent to annual compound growth of 5.6%. Engineering has been, and still is, male dominated. In 2006, 10.6% of supply of engineers was women. Although in the next five years the number of women increased much faster than men, 8.0% per year compared to 5.3% per year, the proportion of women in supply grew more slowly and in 2011 was still just 11.8%. Table 2.1: The Engineering Labour Markets in the 2006 and 2011 Censuses Labour force Engineering Team 2006 Engineering Team 2011 status Men Women Total Men Women Total Employed FT Employed PT Employed away TOTAL EMPLOYED Unemployed (FT) Unemployed (PT) TOTAL UNEMPLOYED LABOUR FORCE Not in labour force ENGINEERING POPULATION Participation Rate (%) Unemployment Rate (%) Employed in Engineering % in Engineering Source: ABS, 2006 and 2011 Population Census, compiled using TableBuilder Pro The supply of engineers is a small component of Australia s skilled labour force. For the purposes of comparison, the latter is measured by the number of individuals with at least an associate degree or an advanced diploma in any field. In 2011, the supply of engineers was 8.4% of the skilled labour force; with the share higher for men (15.7%) men than for women (1.9%). In turn, the skilled labour force was 29.8% of the entire Australian labour force. In this broader context, the supply of engineers was 2.5% of Australia s labour supply. 2.2 The Demand for Qualified Engineers The demand for engineers is measured by the numbers employed. In 2006, the demand for engineers was 194,570. As Table 2.1 shows, demand increased by 30.8% by 2011 to 254,515; equivalent to annual compound growth of 5.5%. Gender proportions of demand were similar to supply in both census years, but this masks comparatively rapid growth in demand for women engineers. Their numbers increased from 20,079 to 29,192, an increase of 45.4%, equivalent to compound annual growth of 7.8% compared to 5.3% for men. Engineers Australia 7

21 In 2006, 87.3% of qualified engineers worked full time and 12.7% worked part time 4. Proportionally, more women than men worked part time, but in numerical terms, almost four times as many men than women 4 Full and part time proportions were used to allocate those away from work. Engineers Australia 7

22 worked part time. By 2011, the proportion of full time work fell to 86.7% and the proportion of part time work increased to 13.3%. Both genders experienced increases in part time work between 2006 and 2011; in the case of men, part time employment increased by 31.6%, compared to 29.4% for full time, and in the case of women, part time employment increased by 55.9%, compared to 41.2% for full time employment. The incidence of part time employment is lower for engineers than for either skilled workers or employment as a whole. In 2011, 72.3% of skilled employment was full time (84.5% for men and 61.2% for women) and 27.7% was part time (15.5% for men and 38.8% for women); for total employment, 67.5% was full time (80.6% for men and 52.5% for women) and 32.5% was part time (19.4% for men and 47.5% for women). 2.3 Retention in Engineering Research has shown that individuals holding recognised qualifications in engineering are employed in almost every occupation in the ABS Australian and New Zealand Standard Classification of Occupations (ANZSCO). Many occupations are familiar to engineers, but the connections of many others to engineering are remote or non-existent. This dichotomy led to systematic research that identified 52 of 358 four digit occupations in the Classification as engineering occupations. The research applied criteria relating to type and level of qualifications, level of work undertaken and the degree of attachment to engineering 5. The selected occupations cover the wide range of positions that are common in engineering careers, from entry level positions to senior management and the diversity of working arrangements in engineering, and avoid the confusion often caused by relying on job nomenclature. The number of individuals with engineering qualifications employed in engineering occupations is substantially less than those with engineering qualifications and is a measure of retention of qualified people in engineering. A useful short hand measure is the proportion of engineering supply employed in engineering occupations. There is a vital policy reason for distinguishing between the supply of engineers and the proportion of supply employed in engineering occupations. Growing the number of individuals with recognised engineering qualifications is essential to ensure the growth of supply. But it is not sufficient to ensure adequate growth in the number of qualified people employed in engineering. To achieve this objective requires policies to encourage retention in engineering as well as policies to grow the number of people with engineering qualifications. Thus, complaints about engineering skill shortages are more complex than an inadequate supply of people with engineering qualifications. The reasons why qualified engineers leave engineering for alternative work are complex and are not yet fully understood. In a free labour market like Australia s, individual choices and preferences can change over time. Engineering education and training offers highly attractive transferable skills in problem solving and analysis. These factors mean that salaries, working conditions and career prospects in engineering must compete with those in other fields. Another important factor is employment intermittency. Often project based work, for example, an infrastructure project, involves intensive work for several years, followed by lay-offs when the project is completed. When new projects are available, there are prospects of employment continuity, but all too often breaks between projects are too long and engineers (and others in the construction work force) need to find alternative employment to sustain them. The longer that individuals are away from engineering, the fewer that return to engineering. In many cases they do not return at all. Several other sources of variation in retention can be identified. Retention appears to be related to the level of engineering qualifications held, highest for individuals with doctoral degrees and lowest for individuals with associate engineer qualifications. Retention also appears to be related to gender with the retention of men substantially higher than for women. Finally, the following chapter will demonstrate 5 Engineers Australia, The Engineering Profession in Australia, A Profile from the 2006 Population Census, September 2010, Engineers Australia 8

23 that retention appears to be related to country of origin, with retention lower for overseas born engineers than Australian born engineers. The last two rows of Table 2.1 show the importance of differentiating between the supply of engineers and retention in engineering. In 2006, 122,258 qualified engineers were employed in engineering occupations; 60.9% of the supply of engineers. These figures were markedly different between genders; 112,286 or 62.6% of men and 9,972 or 47.1% of women were in engineering occupations. Conversely, 39.1% of qualified engineers were not employed in engineering occupations and worked in occupations with little or no connection to engineering; alternatively they were unemployed. The growth in demand for engineers in engineering occupations in the five years to 2011 was higher than demand for people with engineering qualifications; 6.0% per year compared to 5.5%. This was the key reason why employers experienced engineering skill shortages. Although, retention in engineering increased to 62.1%, this change was not rapid enough, and its distribution across different engineering disciplines exacerbated the situation, creating recruiting problems for employers. Once again there was a pronounced gender difference with retention increasing more for women than men. Employment growth for women in engineering occupations grew by 9.8% per year compared to 7.8% per year for women with engineering qualifications, much higher than for men where the corresponding figures were 5.7% and 5.3%, respectively. 2.4 Unemployment Unemployment has been low for people with engineering qualifications. In 2006, 6,045 qualified engineers were unemployed with an unemployment rate of 3.0%. The number unemployment increased to 9,375 by 2011 and the unemployment rate to 3.6%, reflecting the increase in the size of the engineering labour market and the overhang from the global financial crisis. Unemployment has been proportionally much higher for women. In 2006, women qualified engineers had an unemployment rate of 5.1% compared to 2.8% for men, and in 2011, women had an unemployment rate of 6.1% compared to 3.2% for men. In 2011, the unemployment rate for qualified engineers was marginally higher than for skilled workers generally, 3.6% compared to 3.4%. In both cases, the rates were below unemployment in the economy as a whole which was 5.6%. However, the gender difference in engineering was not evident in other skills. 2.5 Labour Force Participation In engineering, labour force participation rates are quite high, consistent with high participation observed among skilled workers. Table 2.1 shows that participation rates in engineering were relatively stable between 2006 and In 2011, the participation rate was 81.8% compared to 80.6% for skilled workers and 65.0% for the Australian labour force as a whole. The participation rate for women in engineering has been lower than for men and the gender gap was larger than for skilled workers; 75.0% compared to 77.4%. The implications of high labour force participation limits the scope of policy to increase the number of engineers through policies designed to increase participation. This is why policies to increase the numbers studying engineering are important. 2.6 Types of Engineering Qualifications The mix of engineering qualifications in Australia has been relatively stable over recent years. In 2011, 79.8% of qualified engineers were degree qualified; 3.4% with Doctoral degrees, 12.5% with Masters Engineers Australia 9

24 degrees, 2.1% with post-graduate Diplomas and Certificates and 61.8% with Bachelor degrees. The remaining 20.2% either held an Associate Degree or an Advanced Diploma in engineering Figure 2.1: Engineering Qualifications and Retention in Engineering, 2011 Men Women Total 70.0 Retention in Engineering (%) Doctorates Masters Other Postgraduate Bachelors Associate Total Retention in engineering increases with qualification level. Retention is lowest for qualified engineers holding associate engineer qualifications and highest for those with Doctoral qualifications. This relationship is the same for both genders, but generally the retention of women is lower than for men at each qualification level. 2.7 Distribution between States and Territories This section briefly reviews the main developments in States and Territories. Table 2.2 shows statistics for a range of variables consistent with Table 2.1 for each State and Territory. Figure 2.4 looks at the relative growth in the supply and demand of qualified engineers between 2006 and The rank order of the size of State and Territory engineering labour markets did not change between the two census years, however, the resources boom significantly increased it in affected States. In 2006, there was a substantial gap between the engineering labour markets in NSW and Victoria and the third ranked State Queensland with another substantial gap to Western Australia, the fourth largest labour market. The engineering labour market in South Australia was about half the size of Western Australia and the three smallest jurisdictions combined were about two-thirds the size of South Australia. Unemployment rates in NSW, Victoria and South Australia were higher than the national average in 2006, but were still consistent with relatively tight labour market conditions. Unemployment rates in Western Australia and the two Territories were 2% or less, indicating particularly tight labour market conditions. The rates in Queensland and Tasmania were higher still well below the national average. This pattern confirms the difficult labour market circumstances experienced in the resource States at the time. Just as important is a second conclusion; labour market pressures for qualified engineers were not confined to resource States but were widespread across all States and Territories. The proportion of women engineers varied and was generally in single digits outside of NSW and Victoria. The 2006 pattern in the proportion of the labour force employed in engineering occupations is almost the obverse of the pattern of unemployment rates. Jurisdictions with the tightest labour markets had proportions above the national benchmark and those with labour markets not as tight had proportions below the national benchmark. The only exception was South Australia which had both unemployment rate and proportion employed in engineering occupations above the national benchmark. Engineers Australia 10

25 Three jurisdictions, Queensland Western Australia and the Northern Territory experienced growth well above the national average while the other five experienced strong growth, but less than the national average. The strongest growth occurred in Western Australia where supply of qualified engineers increased by compound 9.1% per year and demand by 9.0% per year. The slowest growth occurred in Tasmania where supply of qualified engineers increased by compound 4.1% per year and demand by 3.9% per year. Table 2.2: Comparative Statistics for States and Territories 2006 State or Labour Number Proportion Unemployment (%) Retention in Engineering (%) Territory Force Employed of Women (%) Men Women Men Women NSW Victoria Queensland SA WA Tasmania NT ACT Australia NSW Victoria Queensland SA WA Tasmania NT ACT Australia Source: ABS, 2006 and 2011 Population Census, compiled using TableBuilder Pro Figure 2.2: Comparative Annual Growth Rates for the Supply and Demand for Qualified Engineers in States and Territories Demand Supply Australia ACT NT Tasmania WA SA Queensland Victoria NSW Annual Compound Growth Rate (%) Engineers Australia 11

26 The growth rates in Table 2.2 can be contrasted with the growth in economy wide employment, average 2.0% per year and growth in skilled employment, average 4.6% per year 6. In 2006, retention in engineering nationally was 60.9% and increased to 62.1% in Two observations are useful. First, in both census years, retention in NSW and Victoria for both genders was below the national average while it was higher than the average in the other jurisdictions. The highest retention rates were in Western Australia and in Queensland where the demand for engineers was also highest. 6 Skilled employment is defined consistent with the qualification expected of the engineering team, that is, at least an Associate Degree or an Advanced Diploma in any subject area. Engineers Australia 12

27 Chapter 3: The Importance of Skilled Migrants Main Points Skilled migration is an established feature of the engineering labour market. Between 2006 and 2011, 71.4% of the increase in Australia s supply of qualified engineers came from skilled migration and resulted in the balance of the engineering labour force changing from an Australian born majority in 2006 to an overseas born majority in Skilled migration grew the supply of both overseas born men and women engineers faster than the Australian education system increased supply; 7.6% compared to 3.2% per year for men and 10.0% compared to 3.4% per year for women. The proportion of women is higher in the overseas born segment of the engineering labour market. The proportion of women qualified engineers is higher among the overseas born group than Australian; in 2006 the proportion of overseas born women engineers was 13.0% and increased to 14.3% in In contrast, the proportion of Australian born women engineers was 8.2% in 2006 and 8.8% in Retention in engineering occupations is substantially lower for overseas born engineers. In 2011, 57.2% of overseas born male engineers were retained in engineering occupations compared to 70.6% of Australian born men; the corresponding statistics for women were 45.4% compared to 62.2%, respectively. These differences meant that contribution of skilled migration to the increase in engineers working in engineering occupations was 66.4% compared to a 71.4% contribution to increased supply. About half of Australia s skilled migrant engineers arrived before 2000 and the other half since then confirming Australia s heavy reliance on skilled migrant engineers in recent years. Overseas born engineers experience higher unemployment than Australian born engineers. Unemployment rates were higher for overseas born qualified engineers in both census years and were particularly high for overseas born women who experienced 7.9% unemployment in Unemployment is higher for more recently arrived skilled migrants and was well above the segment average for arrivals from 2008 onwards. Higher unemployment appears to be associated with some regions of origin. Australia draws skilled migrant engineers from a wide diversity of countries. The largest contemporary source of skilled migrant engineers is the countries of the Southern and Central Asian region accounting for about 25%. Up until the GFC migrant engineers from the North Western European region averaged about 16% of annual arrivals but since the GFC this has increased to about 23%. Retention in engineering occupations does not appear to be related to time of arrival in Australia but does appear to vary considerably by source region. Retention rates for arrivals from North Western Europe are equal to Australian born engineers. Retention rates for three other source regions are above the average for the overseas born segment but retention rates for five source regions were below this average, some regions well below. Available statistics on English language proficiency indicate that skilled migrants typically assess their proficiency in spoken English more highly than anecdotal feedback would suggest. More reliable statistics are needed to adequately assess this issue. Engineers Australia 13

28 3.1 Country of Origin and the Engineering Labour Market Skilled migration has been an on-going feature of the engineering profession for several decades. In recent years, skilled migration has been the Commonwealth Government s first line response to engineering skill shortages with large numbers of permanent visas and similar numbers of temporary visas granted. More recently, there has been a pronounced deterioration in the engineering labour market but skilled migration has continued levels close to record intakes. In these circumstances, the role of skilled migrants is less clear. This Chapter sets the context for a later one on skilled migration by examining the relative size of Australian and overseas born components of the engineering labour market and how their characteristics differ. This begins by dividing Table 2.1 into these components as shown in Table 3.1. Table 3.1: The Engineering Labour Markets in the 2006 and 2011 Censuses 2006 Census Labour force Australian Born Overseas Born Engineering Team status Men Women Total Men Women Total Men Women Total Employed FT Employed PT Employed away TOTAL EMPLOYED Unemployed (FT) Unemployed (PT) TOTAL UNEMPLOYED LABOUR FORCE Not in labour force ENGINEERING POPULATION Participation Rate (%) Unemployment Rate (%) Employed in Engineering % in Engineering Census Employed FT Employed PT Employed away TOTAL EMPLOYED Unemployed (FT) Unemployed (PT) TOTAL UNEMPLOYED LABOUR FORCE Not in labour force ENGINEERING POPULATION Participation Rate (%) Unemployment Rate (%) Employed in Engineering % in Engineering Source: Compiled using the ABS TableBuilder Pro Facility Australian born includes all people born in Australia, including the children born in Australia whose parents were born overseas. Overseas born includes all people born overseas, irrespective of their age on arrival in Australia. This definition includes all children born overseas even ones who have grown to adulthood and have been educated in Australia. To focus on skilled migration instead of overseas born, it is necessary to examine statistics by arrival in Australia and to compare differences and similarities in characteristics of people by time of arrival in Australia. For the purposes of this section the differentiation in Table 3.1 is sufficient but later sections will consider the implications of time of arrival in Australia. Skilled migration is an established feature of the engineering labour market In 2006, the overseas born segment of the engineering labour market was already close to half and included large numbers of people active in the labour market and large numbers no longer active having Engineers Australia 14

29 retired. These shares are the result of high levels of skilled migration over a protracted period and not just the consequences of skilled migration to support the resources boom. The majority of the engineering labour market has now been born overseas. The 2006 to 2011 period saw the Australian born segment of the engineering labour force change from a majority of 51.6% to a minority of 46.1%. Conversely, the overseas born segment changed from a minority of 48.4% to a majority of 53.9%. In recent years most of the increase in the supply of engineers was from overseas. Between 2006 and 2011, the supply of engineers increased by 63,275 with average growth of 5.6% per year and the Australian born segment grew more slowly than the overseas born segment; 59.1% of the increase came from overseas born men with average growth of 7.6% per year, 12.3% of the increase came from overseas born women with average growth of 10.0% per year, 25.2% came from Australian born men with average growth of 3.2% per year, and 3.4% came from Australian born women with average growth of 3.4% per year. Overseas born engineers experience higher unemployment than Australian born engineers. In both 2006 and 2011, unemployment rates for overseas born engineers were higher than for Australia born engineers; in % compared to 1.8% and in % compared to 2.2%. These aggregates disguise larger gender differences. Unemployment rates for overseas born men were twice as high as for Australian born men and the rates for overseas born women were over three times the rates for Australian born women. These differences were additional to the gender difference noted in chapter 2. In both census years, unemployment rates for overseas born women were particularly high, 7.1% and 7.9%, respectively, and were not consistent with engineering skill shortages at the time. Retention in engineering occupations is substantially lower for overseas born engineers. At aggregate level, retention of Australian born engineers in engineering occupations was 68.6% in 2006 and 69.9% in In comparison retention of overseas born engineers was 52.8% and 55.5% respectively. Some of the difference was due to gender but substantially fewer overseas born men were retained in engineering occupations than Australian born women. Retention was highest for the stereo typical engineer, Australian born men with 69.5% in 2006 and 70.6% in These figures suggest that Australia s skilled migration program needs to do more to assist skilled migrant engineers to integrate into Australia s engineering labour market. They also highlight a problem retaining women in engineering, one which is especially acute for migrant women. The proportion of women is higher in the overseas born segment of the engineering labour market. The proportion of women in the Australian born segment was 8.2% in 2006 and increased to 8.8% in In comparison, the proportion of women in the overseas born segment was 13.0% in 2006 and increased to 14.3% in This change together with the more rapid growth in overseas women engineers are the main reasons why the overall proportion of women engineers has increased. These statistics demonstrate Australia s strong dependence on overseas born engineers, a dependence that has been increasing. The world economy has not yet fully recovered from the global financial crisis Engineers Australia 15

30 and in these circumstances our dependence on overseas supply is likely to be readily satisfied. However, global economic recovery will increase global demand for engineers and lead to competitive risks for Australia. This point underscores Engineers Australia s preference for greater emphasis on growing the size of the Australian born segment of the engineering labour market. 3.2 Sources of Australia s Migrant Engineers This Section examines the geographic origins of overseas born engineers and their labour market experiences. Table 3.2 takes the overseas born engineering labour force in Table 3.1 and segments it by the region of origin and year of arrival in Australia. Rather than try to reconcile the timing of censuses in 2006 and 2011, the statistics were derived from the 2011 census alone and work backwards in time 7. Table 3.2: The Regions of Origin of Overseas Born Qualified Engineers Labour Force Region of Arrived Overall Status Origin Before 's Pt 2011 Total Oceania and Antarctica North-West Europe Southern and Eastern Europe North Africa and the Middle East South-East Asia Employed North-East Asia Southern and Central Asia Americas Sub-Saharan Africa Supplementary codes Not stated Total Oceania and Antarctica North-West Europe Southern and Eastern Europe North Africa and the Middle East South-East Asia Unemployed North-East Asia Southern and Central Asia Americas Sub-Saharan Africa Supplementary codes Not stated Total Oceania and Antarctica North-West Europe Southern and Eastern Europe North Africa and the Middle East South-East Asia Labour Force North-East Asia Southern and Central Asia Americas Sub-Saharan Africa Supplementary codes Not stated Total Source: ABS, 2006 and 2011 Population Census, compiled using TableBuilder Pro Broad Changes Table 3.2 shows that about half of skilled migrant engineers arrived in Australia before 2000 and about half since then. Also in broad terms, unemployment among migrant engineers falls the longer their time in Australia. More precisely: 40,140 or 28.2% arrived in Australia before 1990; of these 38,764 were employed and 1,376 were unemployed resulting in an unemployment rate of 3.4%. 30,600 or 21.5% arrived in Australia during the 1990s; of these 29,468 were employed and 1,132 were unemployed resulting in an unemployment rate of 3.7%. 7 Table 3.2 shows the total for the overseas born labour force as 142,355 whereas Table 3.1 shows it as 142,362. This difference is due to the random changes used by the ABS in TableBuilder to deal with confidentiality issues. The discussion in the Section uses the figure in Table 3.2. Engineers Australia 16

31 71,615 or 50.3% arrived in Australia in and since 2000; of these 67,400 were employed and 4,215 were unemployed resulting in an unemployment rate of 5.9%. Annual numbers steadily increased, reaching a peak in 2008, falling in 2009 due to the global financial crisis and resuming the earlier trend in the following year. These statistics confirm that in the past decade Australia relied more heavily on skilled migration than in the past. But this reliance has not been without cost in the form of higher unemployment for recent arrivals. Unemployment Experience of Migrant Engineers Figure 3.1 examines the unemployment experience of arrivals since 2000 more closely. The red line in the illustration uses the unemployment rate for Australian born qualified engineers in 2011 as a comparative benchmark. This group experienced 2.2% unemployment. A second benchmark used is the overall unemployment rate experienced by overseas born engineers, irrespective of when they arrived in Australia. This is the green line in the illustration. The relative positions of the green and red lines illustrate the conclusion discussed above; irrespective of when they arrived in Australia, overseas born engineers experience higher unemployment than Australian born engineers. The blue bars in Figure 3.1 illustrate the above conclusion about unemployment and residency in Australia in greater detail. Overseas born engineers who arrived in Australia in and before 2007 experienced unemployment above higher than Australian born engineers but less than the average for all overseas born engineers Figure 3.1: Unemployment Rates in 2011 of Overseas Born Qualified Engineers by Time of Arrival in Australia Unemployment Rate (%) Before 's Pt 2011 Arrival in Australia In contrast, overseas born engineers who have arrived in Australia from 2008 onwards experienced unemployment higher than the average for the overseas born segment as a whole and the rate of unemployment increased substantially the less their residency in Australia. In 2010, for which full year statistics are available, the unemployment rate was 9.5% and in 2011, the unemployment rate was 18.7% for the period up to August when the census was held. Engineers Australia 17

32 The Source of Migrant Engineers Australia attracts migrant engineers from far too many countries to tabulate. Instead Table 3.2 statistics from a more manageable number of global regions. The following sets out the main countries in each region. Oceania and Antarctica: New Zealand and Pacific Island countries North-West Europe: United Kingdom; Ireland; Austria; Belgium; France; Germany; Netherlands; Switzerland; Scandinavian countries. Southern and Eastern Europe: Italy; Malta; Portugal; Spain; Albania; Balkan countries; Greece; Romania; Ukraine; Belarus; Hungary; Russia; Latvia; Lithuania; Czech Republic. North Africa & Middle East: Algeria; Egypt; Libya; Morocco; Sudan; Tunisia; Bahrain; Iran; Iraq; Israel; Jordan; Kuwait; Lebanon; Oman; Qatar Saudi Arabia; UAE; Turkey; Yemen. South East Asia: Burma; Cambodia; Laos; Thailand; Vietnam; Brunei; Indonesia; Malaysia; Philippines; Singapore; Timor-Leste. North East Asia: China; Hong Kong; Macau; Mongolia; Japan; both Koreas. Southern & Central Asia: Bangladesh; Bhutan; India; Maldives; Nepal; Pakistan; Sri Lanka; Afghanistan; Armenia; Azerbaijan; Georgia; Kazakhstan; Kyrgyzstan; Tajikistan; Turkmenistan; Uzbekistan. Americas: all countries of northern and southern America Sub-Saharan Africa; Benin; Cameroon; Central African Republic; Chad; Congo; Gambia; Ghana; Liberia; Niger; Nigeria; Senegal; Angola; Kenya; Ethiopia; Lesotho; South Africa; Zimbabwe. Figure 3.2: Overseas Born Qualified Engineers in 2011, Region of Birth and Time of Arrival in Australia 35.0 Oceania North-West Europe Southern & Eastern Europe North Africa & Middle East South-East Asia North-East Asia Southern & Central Asia Americas Sub-Saharan Africa Proportion in Arrival Period (%) 's Pt 2011 Arrival in Australia The largest group of migrant engineers arriving in Australia before the 1990s were from North-West European countries and accounted for 27.6% of arrivals in that time period. During the 1990s and through to 2010, arrivals from these countries were relatively stable averaging 16.2% of the intake. This changed abruptly after the global financial crisis so that in 2010, 18.8% of new arrivals were from this region, increasing to 23.1%in Engineers Australia 18

33 Before 1990, the second largest group of new migrant engineers came from South East Asian countries accounting for 19.6% of arrivals. In the period to about 2008, arrivals from these countries have averaged 16.0%, but there was a pronounced downwards fall in this share during the global financial crisis which appears to have established a new share level. During the 1990s, migrant engineers from Southern and Central Asia region were just 7.3% of arrivals. This share increased through the 1990s and up to about 2003 when it stabilised around an average of 29.6%. More recently, the share of arrivals from this region has fallen, to 27.9% in 2010 and 25.3% in early 2011, but remains the largest contemporary source of migrant engineers Figure 3.3: Unemployment Rates in 2011 for Overseas Born Qualified Engineers, Region of Birth Unemployment Rate (%) Oceania and Antarctica North-West Europe Southern and Eastern Europe North Africa and the Middle East South-East Asia North-East Asia Southern and Central Asia Americas Sub-Saharan Africa The share of migrant engineers from the North-East Asia region has been falling since the 1990s when the region accounted for 18.4% of arrivals. As a result of this trend the share of migrant engineers from this region fell to 10.3% of arrivals in 2010 and 7.1% in Other regions accounted for smaller shares of arrivals, typically averaging less than 10% of arrivals. The only one of this group showing signs of change are the Americas where a steady upwards trend is evident; from 3.8% in the 1990s to 10.3% in 2010 and There are marked differences in the unemployment experiences of migrant engineers from different regions. This is illustrated in Figure 3.3 which shows average unemployment rates for migrant engineers from the regions covered in Table 3.2. The same comparative benchmarks as used in Figure 3.1 are employed; the red line is the unemployment rate for Australian born engineers and the green line the average unemployment rate for migrant engineers irrespective of when they arrived or region of origin. Migrant engineers from every source region have unemployment rates higher than the Australian born average, but in the case of Oceania and Antarctica, North-West Europe and Sub-Saharan Africa, the differences are small. Migrant engineers from three regions, North Africa and the Middle East, North East Asia and Southern and Central Asia, have unemployment rates well above the average for all migrant engineers. Unemployment rates for the remaining three regions are relatively close to the average. 3.3 Retention in Engineering Occupations In 2011, 55.5% of overseas born engineers were employed in engineering occupations compared to 69.9% for Australian born engineers. This section examines whether time of arrival in Australia and region of origin result in further differences in retention in engineering. Engineers Australia 19

34 Figure 3.4 looks at time of arrival in Australia since Once again the comparative benchmarks introduced in the discussion of Figure 3.1 are used; the red line is the average retention in engineering of Australian born engineers and the green line the average retention in engineering of migrant engineers. Irrespective of time in Australia, migrant engineers who arrived in Australia since 2000 have lower retention in engineering than Australian born engineers. Although for some arrival years retention in engineering is higher than the average for all migrant engineers, the evidence that year of arrival is a factor in the retention of migrant engineers in engineering is fairly weak Figure 3.4: The Proportion of Overseas Born Qualified Engineers Employed in Engineering Occupations in 2011, By Arrival in Australia 70.0 Proportion of Arrival Group (%) Pt 2011 Arrived in Australia 80.0 Figure 3.5: Proportion of Overseas Born Qualified Engineers Employed in Engineering Occupations in 2011, By Region of Birth Proportion of Qualified Engineers in Engineering Occupations (%) Oceania and Antarctica North-West Europe Southern North Africa and Eastern and the Europe Middle East South-East Asia North-East Asia Southern and Central Asia Americas Sub- Saharan Africa Total Figure 3.5 looks at retention in engineering occupation by region of origin, again using the now two familiar benchmarks. Only migrants from North-West Europe have retention equal to Australian born engineers but three other regions, Oceania and Antarctica, Sub-Saharan Africa and the Americas have retention rates well above the average for overseas born engineers. Retention in engineering for the other five regions is below the average for Australian born engineers and in two cases, South-East Asia and North East Asia, is below half. The evidence from Figure 3.5 suggests that region of origin may be a factor in retention in engineering of migrant engineers. Engineers Australia 20

35 3.4 Proficiency in Spoken English For some time, visa application processes for prospective skilled migrants have included a requirement to demonstrate spoken and written English language skills in a formal and documented process. Census statistics on English proficiency are not very strong and rely on respondents own assessment of their spoken English language proficiency. A 5 point scale was used (Speaks only English, speaks English very well, Speaks English well, speaks English not well and does not speak English at all). Figure 3.6 combines statistics for the first three responses (that is at least speaks English well) for overseas born engineers in 2011 by arrival in Australia Figure 3.6: The Proportion of Overseas Born Qualified Engineers Who Assessed their Spoken English Proficiency as Very Well or Well in Proportion of Arrival Groups (%) Pt 2011 Arrived in Australia As expected, a very high proportion of respondents assessed their spoken English language proficiency to be at least speaks English well with the results well over 96% for all arrival years. There is some evidence that English proficiency increases with time in Australia but this result is weakened by the statistics prior to Other statistics are required to provide a more objective perspective on this issue. Engineers Australia 21

36 Chapter 4 Transition from School to Engineering Education Main Points Established trends in the proportion of year 12 students studying intermediate and advanced mathematics and science subjects continue to fall. However, in the last few years, increased participation of students to year 12 has meant the actual number of students has increased or stabilised. Up to about 2006, interest in university engineering courses had waned. Since then, applications from year 12 students, offers of places by universities and acceptances of places all accelerated rapidly. Although numbers continue to increase and are now at record levels, the rate of increase has slowed markedly. Engineering continues to attract high quality students. Completion of secondary education is the basis of admission to entry level engineering degrees for about two-thirds of domestic students, down from 71% a decade ago. Other means of admission, though small individually, are increasingly important. The basis of admission for overseas students is different and shared more evenly across several means with open learning and special entry rising to prominence recently. 4.1 Year 12 Mathematics and Science Studies Mathematics and science are important year 12 subjects for prospective engineering students. Past editions of the Statistical Overview have reported statistics from several sources. Trends for year 12 mathematics subjects are regularly updated by Professor F Barrington for publication by the Australian Mathematical Sciences Institute (AMSI) 8. Figure 4.1 illustrates the latest statistics up to Figure 4.1: Year 12 Participation in Mathematics 60.0 Advanced Intermediate Elementary 50.0 % of year 12 students There has been little change in observed subject trends, although the proportion of students studying some level of mathematics has averaged a little over 80% since The share of year 12 students enrolled in advanced mathematics continues to fall. In 1995, 14.1% were enrolled in advanced mathematics and they has been a steady downwards trend ever since. By 2011, the share had fallen to 8 AMSI, Engineers Australia 22

37 9.6% and it fell further to 9.4% in At present, this influence is offset by the increasing size of the year 12 population so that actual numbers enrolled in advanced mathematics increased by 0.9% from 20,608 in 2011 to 20,786 in Figure 4.2: Year 12 Participation in Physics and Chemistry 24 Physics Chemistry 22 % of year 12 students Figure 4.3: Year 12 Student Participation In Science % of Students Studying at least one Science Unit Barrington s statistics for enrolments in intermediate mathematics subjects excludes students who are also enrolled in advanced mathematics. The trend for the share of students in these subjects has also been steadily downwards; from 27.2% in 1995 to 19.8% in 2011 and a further fall in 2012 to 19.4%. As was the case for advanced mathematics, the actual number of students enrolled increase slightly from 42,548 in 2011 to 42,689 in 2012, an increase of 0.3%. The share of year 12 students enrolled in elementary mathematics subjects has plateaued at 52.0%. Engineers Australia 23

38 In recent years, the downwards trends in the study of mathematics and science studies at school have received a lot of attention. Statistics on mathematics trends are regularly updated as noted above, but surprisingly few up-to-date statistics are available for science subjects. Previous editions of the Statistical Overview have included the statistics from the Ainley, Kos and Nicholas 9 report. These showed the trends up to Additional statistics for 2009 were included in recent work by the Chief Scientist and have been included in a revised Figure 4.2 which shows the trend in physics and chemistry enrolments. Figure 4.2 shows that the downwards trends in the proportion of year 12 students enrolled in physics and chemistry has continued. However, like in mathematics, actual numbers enrolled have increased slightly as high school participation to year 12 has increased; in chemistry to 35,867 in 2009 from 35,697 in 2007 and in physics from 28,931 to 29,532 in Another perspective on year 12 science studies was reported by the Australian Academy of Science in recent work for the Chief Scientist 10. This report noted that students can study one, two or more science subjects in their final year and so compared the number of students studying at least one science subject to total year 12 enrolments. This proportion is reproduced in Figure 4.3 and shows that around 2000 to 2001 there was a substantial drop in the proportion with a more moderate downwards trend in recent years. In 2010, the proportion of year 12 students studying at least one science subject was 51.4%, down on previous years, but the actual number of students in this group was 110,328, the highest since Figure 4.4: Year 12 Course Completions by Subject 25.0 English Maths Science Society & Environment Technology Arts Health & PE Languages Other % of Total Course Completions Completion of Year 12 Mathematics and Science A better set of indicators than year 12 science commencement statistics are year 12 science completions. Previous editions of the Statistical Overview included completion statistics compiled by the Group of 8 Universities Secretariat 11. These statistics were sourced from State and Territory assessment, curriculum or accreditation authorities and reconciled the different nomenclatures used throughout the country using a similar structure to Barrington s approach in mathematics. The Group of 8 9 Ainley J, Kos J and Nicholas, M, Participation in sciences, mathematics and technology in Australian education, ACER Research Monograph 63, Australian Academy of Science, The status and Quality of Year 11 and 12 Science in Australian Schools, 2012, 11 Group of 8, National Trends in Year 12 Course Completions, Policy Note Number 6, April 2012, Engineers Australia 24

39 Secretariat kindly made these statistics available to Engineers Australia 12, but the labour intensity of this work has meant that the statistics have not been updated. The remainder of the material in this section is unchanged from last year. The statistics compiled were subject and overall completions, rather than unit records for individual students and can be applied in several ways; to examine the status of mathematics and science studies; to examine the gender balance in subjects and to examine trends in absolute numbers of course completions Figure 4.5: Trends in the Completion of Year 12 Mathematics Courses Boys Advanced Girls Advanced Boys Intermediate Girls Intermediate Boys Fundamental Girls Fundamental Number of Completions Figure 4.6: Trends in the Completion of Year 12 Science Courses Boys Physics Girls Physics Boys Chemistry Girls Chemistry Boys Biology Girls Biology 35,000 30,000 No of Course Completions 25,000 20,000 15,000 10,000 5, In 2005, there were 194,165 year 12 students who completed 954,937 courses, an average of 4.9 courses per student. By 2010, student numbers had increased 10.5% to 214,542, but course completions only increased by 2.8% because the average number of course completed per student fell 12 I would like to express my thanks to Mike Gallagher and Mike Teese from the Go8 for making the statistics available to Engineers Australia. Engineers Australia 25

40 to 4.6. The important issue for tertiary engineering courses is flow of year 12 students completing mathematics and science courses and the level of mathematics and the nature of science courses. On average, each year 12 student completed between 4.9 and 4.6 courses, or about 5 courses. In other words, a subject with about twenty percent of completions is studied by almost all students. Figure 4.4 shows that both mathematics and English are in this category and the trends in both subjects were stable over the six years examined. However, in science the proportion of course completions drops to about 14.5%, suggesting that about two-thirds of year 12 students complete a science course. Figure 4.5 looks at mathematics completions more closely; it shows the trends in the numbers of boys and girls completing advanced, intermediate and fundamental mathematics courses. The illustration shows actual numbers of completions rather than the proportion illustrated in Figure 4.1 above. Figure 4.4 shows that completions of mathematics courses have increased for both genders; by 6.6% for boys and by 5.0% for girls. The number of advanced mathematics course completions has increased for both boys and girls; by 56.7% for boys and by 67.1% for girls. But the number of completions by girls is considerably and consistently lower than for boys. In 2010, 23,484 advanced mathematics courses were completed by boys and 15,553 were completed by girls. These trends are consistent with observations from Barrington s statistics, there is a downwards trend in the proportion of year 12 students with advanced mathematics, but actual numbers are increasing. The number of intermediate mathematics course completions has fallen for both boys and girls; by 15.3% for boys and by 13.8% for girls. This result is different to observations from Barrington s statistics which showed a small increase in numbers, but this difference may just be due to commencements not translating into completions. Fewer girls than boys complete intermediate mathematics courses. In 2010, 38,704 intermediate mathematics courses were completed by boys and 36,261 by girls. The number of fundamental mathematics course completions has increased for both boys and girls; by 13.1% for boys and by 9.8% for girls. The gender composition is opposite that for completion of advanced and intermediate mathematics courses with more girls than boys completing mathematics at this level. Figures 4.2 and 4.3 showed that proportionally year 12 science commencements have been decreasing. Figure 4.6 shows that completion of science courses have been stable at about 14.5% of total completions. It is the composition of science completions and its gender balance that is the limiting factor for the flow of year 12 students to tertiary engineering courses. Biology accounts for about one third of year 12 science completions (the red line in Figure 4.6). Completions by girls outnumber completions by boys by two to one; in 2010, there were 30,555 completions by girls compared to 16,747 by boys. Chemistry accounts for about one quarter of year 12 science completions (the brown and yellow lines in Figure 4.6). Although completions by boys were higher, there was not much gender difference. In 2010, there were 17,253 completions by boys and 16,363 completions by girls. About one fifth of year 12 science completions were physics courses and here there was a different gender balance to that observed for biology. Completions by boys outnumber completions by girls by almost three to one. There was a slowly increasing trend in completions by boys, but at best, a static or slowly falling trend for girls. In 2010, 17,253 boys completed year 12 physics courses and only 6,977 girls. These statistics confirm the widespread perception that far too few high school students are completing mathematics and science courses needed for tertiary studies in engineering. The importance of higher participation to year 12 is that actual numbers completing these courses have stopped falling and in some cases there are small increases. However, at some point participation will stabilise and the continuing problem that the proportion of year 12 students studying these courses is falling, will remerge. Gender balance is another issue that needs to be addressed as this could become a limiting factor to increasing the number of women engineers. Engineers Australia 26

41 4.3 Basis of Admission to Bachelor Degrees 13 Previous editions of the Statistical Overview have not covered how engineering students obtain university entry. These statistics have now been made available from the Australian Council of Engineering Deans and are considered in some detail in this section. Figure 4.7: The Basis of Admission to Bachelor Degrees in Engineering, Domestic Students 9000 Completion of secondary Higher education studies TAFE/VET studies Mature age Institutional assessment Other Numbers Figure 4.8: Basis of Admission to Bachelor Degrees in Engineering, Overseas Students 2500 Completion of secondary Higher education studies TAFE/VET studies Mature age Institutional assessment Other Number The statistics distinguish between domestic students (either citizens or permanent humanitarian visa holders and are eligible for the HECS-HELP systems of student charges, loan assistance and loan repayment arrangements) and overseas students (non-citizens that do not hold a permanent 13 The statistics for this section were provided by the Australian Council of Engineering Deans. Engineers Australia is grateful for their assistance. Unfortunately, statistics were not available for Engineers Australia 27

42 humanitarian visa, including New Zealand citizens). Figure 4.7 illustrates the basis of admission to bachelor degrees in engineering for domestic students and Figure 4.8 illustrates these statistics for overseas students. The largest group of domestic student admissions is completion of secondary studies at school or at TAFE. Proportionally this method of admission has steadily fallen from over 71% to 65% in 2012 but remains the largest group by a substantial margin. Actual admission numbers fell from 7,606 in 2001 to 6,603 in 2006, a fall of 13.2%. Since 2006 they have increased by 33.8% to 8,835 in 2012, a net increase of 16.2% over a decade. The second largest group of domestic student admissions is higher education studies; either completed or incomplete, in Australia or overseas. This group increased its share of admissions from about 12.6% in 2001 to 19.2% in For some time, actual admission numbers were fairly steady in the range 1,250 to 1,350 with only minor annual changes. But from 2007, numbers have steadily increased and in 2012, 2,604 domestic students were admitted to bachelor degree programs in engineering through this channel. Admission based on TAFE or VET studies is an important but relatively small group, accounting for between 5 and 7% of admissions. Numbers have increased from less than 500 in 2001 to 904 in 2012, demonstrating the importance of articulation guidelines. The other group includes open learning and special entry, and while annual changes have been wider larger than other admission channels, numbers have remained less than a thousand per year. The basis of admission for overseas students is quite different to the pattern established for domestic admissions. Admissions fall into three large groups that dominate annual statistics and three small ones that round off annual intakes. About 30% of admissions are students who have completed secondary studies, either in Australia or overseas, in schools or equivalent institutions. About 30% of admissions are students who have complete or incomplete higher education histories, either in Australia or overseas. The shares of these groups have varied from year to year and numbers have increased roughly in line with overall admission increases. The third group, other including open learning and special entry, has in size; particularly in recent years to dominate in 2012 with 2,062 or 39.5% of admissions. 4.4 Transition from School to University Engineering Courses With the election of a new Government, responsibility for higher education matters has now moved to the Department of Education (DE) which has continued to update statistics on undergraduate applications, offers and acceptance into university courses. The material below follows the approach taken last year and updates statistics to The analysis applies to domestic students seeking admission to courses through completion of secondary education, that is, the largest group covered by Figure 4.7 above. Trends in applications for places in engineering courses, offers made by universities and acceptances of places are illustrated in Figure 4.9. These trends include revisions made since last year. In 2013, there were 18,570 applications for places in engineering courses from current year 12 students; 1.9% higher than in Offers of places from universities increased by 1.7% to 15,851 and acceptances of offers increased by 1.5% to 12,225. Figure 4.9 shows that there was an acceleration of interest in engineering courses from about 2006 onwards. The latest figures suggest there has been an abrupt slowdown in this trend but numbers are continuing to increase. Perhaps a factor here is the increasing numbers of students being admitted to engineering courses through other mechanisms. Engineers Australia 28

43 Figure 4.9: Applications for, Offers Made and Acceptances of Places in University Engineering Courses, 2001 to ,000 Applicants Offers Acceptances 19,000 18,000 17,000 16,000 15,000 Numbers 14,000 13,000 12,000 11,000 10,000 9,000 8,000 7, Figure 4.10: Offers Made by Universities by ATAR Scores, 2013 Engineering Sciences All Offers % of Offers or less or more ATAR BANDS Engineering continues to attract high quality students. This is illustrated in Figure 4.11 which compares the proportions of year 12 offers of places in engineering by ATAR bands for the three years 2009 to Last year, the Department of Education published these profiles for acceptances, but as the illustration shows, the change to the ATAR profiles of offers makes little difference to the overall conclusion. Engineers Australia 29

44 Chapter 5 University Engineering Education Main Points Domestic student commencements in Engineering and Related Technologies courses continue to increase, growing by 4.8% in Commencements in post-graduate courses grew by 5.6% after falling by 17.9% the previous year. Commencements in entry level courses continued the growth evident in recent years, increasing by 5.0% to 15,131, including 13,595 commencements in bachelor degrees. The proportion of women in entry level courses has fallen in the last few years and was 13.2% in 2012 but the proportion of women has remained steady at 19.2% in post-graduate courses. The level of overseas student commencements has fluctuated in the 10,000 to 10,500 range during the last four years. Particularly notable has been the increase in doctoral commencements. Although bachelor degree commencements have fallen, these courses are by far the most popular among overseas students, twice as many as coursework masters degrees which in turn have twice as many commencements as doctoral degrees. In 2012, the engineering student population at Australian universities was an all-time high at 91,962; 62,757 or 68.2% were domestic students and 29,205 or 31.8% were overseas students. Almost threequarters of students were enrolled in bachelor degrees; 76.6% of domestic students and 62.1% of overseas students. Domestic student course completions increased by 5.0% in 2012 with the women s share of 15.3% below the decade average. Completions of entry level courses increased by 4.7% with the women s share of 14.5% below the decade average. Overseas student completions fell by 5.3% in 2012 with the main area of decline being coursework masters degrees which fell from 2,785 to 2,259 in Entry level course completions increased by 6.9% in Retention rates measure successful progression of students from one year to the next. Not surprisingly, retention rates are lower for first year students and for part time students. Overseas students generally have higher retention rates than domestic students. In 2011, retention rates for all full time domestic students were 86.4% for men and 87.0% for women; for overseas students these rates were 88.9% for men and 90.9% for women. Over the past decade engineering course completions were 5.0% of all completions for domestic students and 6.7% for overseas students. However, engineering shares of doctoral completions are well above these shares and in 2012 were 10.3% for domestic students and 19.2% for overseas students. In contrast, the engineering share of coursework master degree completions was below average for domestic students (3.8% in 2012) and in line with the average (6.5% in 2012) for overseas students. 5.1 Course Commencements This Section discusses statistics on commencements in university Engineering and Related Technologies courses. The statistics considered distinguish between courses at different levels from Doctoral Degree through to undergraduate diplomas and certificates. This distinction is not always made and discussions centre on trends in aggregate commencements which can be misleading. To monitor the flow of entrants into the engineering profession, trends in entry level courses are important and trends in post-graduate courses indicate the extent to which graduate engineers are building on existing knowledge. Engineering and Related Technologies includes courses in Geomatic engineering, Engineers Australia 30

45 commonly referred to as surveying. These courses have few participants and disaggregation to exclude them makes little difference to trends and is not cost effective. Trends in commencements in university engineering courses are examined in Tables 5.1 to 5.4. The first two tables consider the differences between domestic and overseas students and the second two tables aggregate the first two to highlight country of origin and gender. Country of origin is important because domestic students can directly join the Australian labour market once their course has been completed. Overseas or international students cannot join the labour market unless they satisfy immigration formalities and obtain either a permanent or temporary skilled migrant visa. Two distinct periods are evident in Table 1. In 2001, total commencements in engineering courses were 14,031, yet by 2005 they had fallen to 13,579 with an average annual rate of contraction of -0.8%. Commencements in entry level courses had a similar trend; 11,012 commencements in 2001, falling by an average annual 1.7% to 10,293 commencements in The situation changed to a growth trend from By 2012, total commencements had increased to 19,710, growing by an average 4.6% per year. Entry level commencements grew even faster, by an average 5.5% per year to be 15,131 in Using these average growth rates, total commencements in 2013 are estimated to be 20,600 and entry level commencements 15,960. In 2011, domestic commencements in post graduate courses fell by 1.8%. Commencements fell in Doctoral and Research Masters Degrees, but increased in Coursework Masters Degrees and other postgraduate courses. However, the level of commencements was the second highest on record exceeded only by 2010 and was 30.2% higher than in Domestic post-graduate commencements by men fell by 2.1%; falling for Doctoral and Research Masters Degrees, little change in Coursework Masters Degrees and an increase in other post-graduate courses. Commencements in 2011 were 29.6% higher than Domestic post-graduate commencements by women fell by a smaller 0.7% and the pattern of change was similar to men, however the overall change since 2001 was greater at 33.1%. Domestic commencements in entry level courses increased by 3.7% compared to 2010, bringing the increase since 2001 to 33.7%. In 2011, commencements in Bachelors Degrees accounted for over 91% of entry level courses, but there has been strong trend towards Associate Degrees and Advanced diplomas since 2001 with about 92% being men. Entry level course commencements by men increased by 4.4% in 2011 and by 33.4% since Entry level course commencements by women fell by 0.9% in 2011, mainly due to a fall in commencements in Associate Degree and Advanced diploma courses. There was a 0.9% increase in commencements in Bachelors Degree courses. The proportion of women studying engineering remains higher than the proportion of women engineers in the labour force but there is no sign of continuing improvement. In 2011, women accounted for 15.3% of domestic commencements in engineering courses; 19.5% in post-graduate courses; 13.4% in entry level courses and 31.7% in other under-graduate courses. Commencements in post-graduate courses by overseas students fell by 4.9% in 2011, following a fall of 8.3% in Commencements in Doctoral Degrees increased by 13.6% and there were small increases in Research Masters Degrees and other post-graduate courses, but commencements in Coursework Masters Degrees, the largest component, fell by 12.1%. Despite these changes overseas student commencements in 2011 were more than twice 2001 levels. Overseas commencements in entry level courses increased by 1.4% in 2011 and were 73% higher than in The proportion of overseas students commencing Associate Degree or Advanced diploma courses is lower than domestic students with over 95% favouring Bachelor Degrees. The proportion of overseas born women commencing entry level courses was 16.6% in Engineers Australia 31

46 Table 5.1: Domestic Students Commencing Engineering and Related Technologies Courses Men Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total Women Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas < Diplomas < Other undergraduate Total All domestic commencements Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by the Department of Education Table 5.2: Overseas Students Commencing Engineering & Related Technologies Courses Men Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total Women Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total All overseas commencemenrs Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by the Department of Education Engineers Australia 32

47 Table 5.3: Students Commencing Engineering & Related Technologies Courses, by Country of Domicile Domestic students Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total Overseas students Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate <5 81 Total All commencing students Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by the Department of Education Table 5.4: Students Commencing Engineering & Related Technologies Courses, by Gender Men Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total Women Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total All commencemenrs Doctoral Research masters Coursework masters Other postgraduate Bachelors Ass degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by DEEWR to 2010 and DIICCSTRE for 2011 Engineers Australia 33

48 In summary, engineering course commencements increased to a record high of 29,199, 0.8% higher than in Commencements by domestic students offset a fall in overseas commencements reducing the proportion of overseas commencing students to 35.6%, still higher than the 2001 share of 27.3%. Commencements in Bachelors Degrees were almost two-thirds of the total and continued to increase. Coursework Masters Degrees are the most popular post-graduate courses accounting for 13.7% despite reduced commencements this year. Commencements in Doctoral Degree are at a record high of 1,528 or 5.2% of commencements. Overall 16.3% of commencements in 2011 were women. 5.2 Enrolments in Engineering Courses Enrolments in engineering courses reflect the work loads of academics and demands on university infrastructure. Tables 5.5 to 5.8 consider the engineering student population corresponding to the commencement statistics discussed above. In 2012, the number of students enrolled in engineering courses was at an all-time high of 91,962. In 2012, domestic enrolments increased by 4.1% to 62,757, continuing the growth trend evident since Over three-quarters of students were studying for Bachelors Degrees, 5.3% were studying for Doctoral Degree, 6.5% were studying for Coursework Masters Degrees and 5.3% were studying for Associate Degrees and Advanced Diplomas. The number of overseas students enrolled in engineering courses was also at a record high, increasing by 2.4% to 29,205 in The number of overseas Doctoral Degree students is now higher than the number of domestic students, accounting for 12.5% of enrolments. Coursework Masters Degrees have been important to overseas students for some time and account for 17.2% of enrolments. The strong focus on post-graduate studies means that the proportion of overseas students studying Bachelor Degrees is lower than for domestic students, 62.1% in Women account for 18.4% of overseas enrolments. 5.3 Course Completions Tables 5.9 to 5.12 consider course completions corresponding to the commencements and enrolments discussed in the two previous Sections. Readers are advised that using the tables presented to estimate the proportion of commencements that complete as a measure of student pass rates is inadvisable because courses have different durations, may be full time or part time, students may transfer from full to part time studies and students may transfer into or out of engineering courses to and from other faculties. Student success rates are considered in the next section using statistics provided by the Australian Council of Engineering Deans (ACED). Completions of university engineering courses were at a record high in 2012, increasing marginally by 0.5% to 16,912. There were countervailing changes in the two main groups of students; domestic student completions increased by 5.0% to 9,896 but overseas student completions fell by 5.3% to 7,016. Features of domestic student completions include: Doctoral Degrees completions increased by 23.8% to 495. Coursework Masters Degrees completions increased by 9.6% to 1,145. Bachelor Degree completions increased by 2.0% to 6,795. Increased commencements in Associate Degrees and Advanced Diplomas are now reflected in a large 58.4% increase in completions to 518. As a result entry level completions increased by 4.7% to 7,313. Women accounted for 15.3% of all completions, 15.0% of Bachelor Degree completions and 14.5% of entry level completions. Engineers Australia 34

49 Table 5.5: Domestic Students Enrolled in Engineering & Related Technologies Courses Men Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Women Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Domestic students Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by Department of Education Table 5.6: Overseas Students Enrolled in Engineering & Related Technologies Courses Men Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Women Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Overseas students Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by Department of Education Engineers Australia 35

50 Table 5.7: Students Enrolled in Engineering & Related Technologies Courses, by Country of Domicile Domestic Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Overseas Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total All students Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by Department of Education Table 5.8: Students Enrolled in Engineering & Related Technologies Courses, by Gender Men Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Women Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total All students Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by Department of Education Engineers Australia 36

51 Features of overseas student completions include: Doctoral Degrees completions increased by 18.7% to 457. Coursework Masters Degrees completions fell by 18.9% to 2,259. Bachelor Degree completions increased by 4.4% to 3,466. Increased commencements in Associate Degrees and Advanced Diplomas are now reflected in a large 155.4% increase in completions to 143. As a result entry level completions increased by 6.9% to 3,609. Women accounted for 18.2% of all completions, 19.3% of Coursework Masters completions and 18.0% of Bachelor Degree completions. 5.4 Annual Retention Rates for Bachelor Degrees A number of readers have inquired about statistics on pass rates in engineering. The ideal measure of pass rates should be estimated from longitudinal statistics that track students who switch institutions, who switch between full time and part time study, who are not successful in all years and units and who switch from engineering to other disciplines or from them. This was done by Godfrey and King in a 2011 study that found institutional graduation rates for domestic commencing students in 2003 in the range 40 to 75% with an average of 65%. An alternative indicator of progress used by the Australian Council of Engineering Deans (ACED) is the annual retention rate which measures successful progress of students to the next year of study; that is, the retention rate for 2011 measures the proportion of 2010 students who were confirmed enrolments in These statistics have now been made available by ACED and are included in the Statistical Overview for the first time. Retention statistics can be viewed from different perspectives, but the approach of most interest to the engineering profession is retention of students in engineering and in the institution of enrolment. This measure is shown in Table 5.13 for the past decade differentiating between domestic and overseas students, gender and whether study was full time or part time. In most university courses, first year students are more likely to drop out of courses for various reasons. About 70% of commencing students were domestic students and 30% were overseas students. In both groups about 90% studied full time. Some of the differences evident in the Table include: Retention rates for domestic commencing full time students are lower than for overseas students; averaged over the decade shown in the Table, 83.2% compared to 89.4% for men and 82.7% compared to 90.5% for women. The highest retention rates are for overseas women studying full time; 90.5% averaged over the decade. Retention rates are significantly lower for commencing students studying part time; averaged over the decade and are lower for men than women; averaged over the decade, 63.5% of domestic men and 58.8% of domestic women proceeded beyond first year and 75.2% of overseas men and 73.7% of overseas women. The differential between retention of part time domestic students and part time overseas students was larger than for full time equivalents. Once students progress beyond first year, retention rates increase for full time students and for domestic part time students. However, they are lower for overseas part time students. The differences observed for commencing students are generally repeated. Engineers Australia 37

52 Table 5.9: Domestic Students Completing Courses in Engineering & Related Technologies Men Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Women Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas 5 < < Diplomas 0 < < Other undergraduate Total All domestic completions Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by Department of Education Table 5.10: Overseas Students Completing Courses in Engineering & Related Technologies Men Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Women Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total All overseas completions Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by Department of Education Engineers Australia 38

53 Table 5.11: Students Completing Courses in Engineering & Related Technologies, by Country of Domicile Domestic Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Overseas Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total All student completions Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by Department of Education Table 5.12: Students Completing Courses in Engineering & Related Technologies, by Gender Men Level Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Women Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total All overseas completions Doctoral Research masters Coursework masters Other postgraduate Bachelors Assoc degrees & advanced diplomas Diplomas Other undergraduate Total Source: Data provided by Department of Education Engineers Australia 39

54 Table 5.13: Annual Retention Rates for Bachelor Degree Students, in Engineering and in Institution Full Time Commencing Students All Full Time Students Domestic Students Overseas Students Domestic Students Overseas Students Year Men Women Men Women Men Women Men Women Part Time Commencing Students All Part Time Students Domestic Students Overseas Students Domestic Students Overseas Students Year Men Women Men Women Men Women Men Women Source: Australian Council Of Engineering Deans 5.5 The Engineering Share of Course Completions On average since 2001, engineering course completions have been 5.0% among domestic students and 6.7% among overseas students. These shares have fluctuated over time, as shown in Figure 5.1, but in 2012 remain on average for overseas students and slightly above average for domestic students. Figure 5.2 shows the trend in engineering shares of doctoral degree completions. The first point to note is that engineers have higher shares of these course completions than courses in general. The average share for domestic students is 10.3% of domestic doctoral completions, twice the average for all course completions. The trend for this group has fairly closely fluctuated about this average and was right on average in The share of doctoral completions by overseas students is particularly high and has increased over time. The average since 2001 was 15.9% but in 2012 it had increased to 19.2%. Numerically, more overseas students complete coursework master degrees in engineering than do domestic students. This difference is also reflected in the respective shares of these course completions as shown in Figure 5.3. On average since 2001, the share of completions of coursework master degrees by domestic engineering students is 3.4%, much lower than the engineering share of all domestic completions. The share has moved up and down over time and in 2012 was 3.8%. The average share of completions of coursework master degrees by overseas engineering students was twice as high, 6.9% with a lower than average 6.5% in Engineers Australia 40

55 8.0 Figure 5.1: The Share of Engineering Course Completions Domestic Students Overseas Students % of Completions Figure 5.2: The Share of Engineering Doctoral Degree Completions 20.0 Domestic Students Overseas Students % of Doctoral Completions Figure 5.3: The Engineering Share of Coursework Masters Degree Completions 9.0 Domestic Students Overseas Students 8.0 % of Coursework Master Completions Engineers Australia 41

56 Figure 5.4: The Engineering Share of Bachelors Degree Completions 8.0 Domestic Students Overseas Students 7.0 % of Bachelors Degree Completions Finally, the engineering shares of completions of bachelor degrees are fairly close to the engineering shares of all courses reflecting the predominance of this type of engineering course. The trends in the shares are shown in Figure 5.4. The decade average for domestic students was 5.6% with a slightly higher share of 5.7% in The decade average for overseas students was 6.6% with a slightly lower share of 6.5% in State and Territory Shares of Bachelor Degree Completions In 2012, 10,261 bachelor degrees in engineering were completed in Australia; 6,795 or 66.2% by domestic students and 3,466 or 33.8% by overseas students. This section examines how these completions were distributed across States and Territories; Figure 5.5 shows the trend in shares for domestic students and Figure 5.6 shows the trend in shares for overseas students. Since 2001, NSW has had on average 28.1% of completions of bachelor degree by domestic students and 26.6% by overseas students. Both shares have trended downwards over time and in 2012 were 26.1% and 21.2%, respectively, representing 1,773 domestic completions and 735 overseas completions. Numerically and proportionally Victoria has the highest completions of bachelor degrees in engineering. For domestic students Victoria s decade average share was 31.2% but this share has tended to fall over time and in 2012 was 29.1% representing 1,976 has completions. For overseas students the decade average share was 34.6% and this has increased over time and was 37.7% in 2012 representing 1,305 completions share. Queensland s share of domestic student completions has increased over time. The decade average was 18.1% but in 2012 there were 1,475 completions giving a share of 21.7%. The State s share of overseas student completions has been much lower than in the domestic sector. The decade average was 13.5% and the share has been falling over time and was 8.7% in 2012 representing 302 completions. Engineers Australia 42

57 40.0 Figure 5.5: Jurisdictional Shares of Completions of Bachelors Degrees in Engineering, Domestic Students NSW Victoria Queensland SA WA Tasmania ACT 35.0 Share of Completions (%) Figure 5.6: The Jurisdictional Distribution of Completions of Bachelors Degrees in Engineering, Overseas Students NSW Victoria Queensland SA WA Tasmania ACT Completions Western Australia has grown its share of both domestic and overseas student completions of bachelor degrees in engineering. For domestic students the decade average was 11.7% but in 2012 the share had increased to 12.8% with 872 completions. For domestic students the decade average was 11.4% and in 2012 the share was 15.8% with 547 completions South Australia has experienced a decreasing share of domestic student completions and an increasing share of overseas student completions. For domestic students the decade average share was 7.4%, falling to 6.8% in 2012 with 463 completions. For overseas students the decade average share was 11.4% increasing to 12.6% in 2012 with 438 completions. Tasmania and the ACT had similar decade average shares for domestic students, 1.5% for Tasmania and 1.8% for the ACT, and although annual shares have tended to vary, in 2012 both jurisdictions had average share with 103 completions in Tasmania and 118 completions in the ACT. In Tasmania the decade average share of overseas student Engineers Australia 43

58 completions was higher than for domestic completions, 2.1% compared to 1.5% and in 2012 was a little lower with a share of 1.8% representing 63 completions. The average share for overseas student completions in the ACT was particularly low at 0.7% but has increased strongly in recent years and was 2.1% in 2012 representing 73 completions. It should be noted that Tasmania is not active in offering coursework master degrees to overseas students but these courses are very strong in the ACT. Engineers Australia 44

59 Chapter 6 Supply and Education Main Points Since 2001, the annual flow into the engineering team from domestic education completions has increased by an average 3.1% at a time when the demand for engineers grew by almost twice this rate. It has only been in the last four years that growth in education completions has consistently exceeded the decade average and only in the last three years that it has matched the increase in demand. The latest official statistics are for 2012 and in that year education completions increased by 7.0% from 8,535 to 9,134. Projecting forward one year suggests growth of 6.6% increasing 2013 completions to 9,734. Just over one fifth of the engineering team are Associate Engineers. Most of the recent growth can be attributed to an increase in the completion of Associate Engineer qualifications which in 2012 accounted for 74.6% of domestic entry level engineering qualifications. The smallest group in the engineering team is Engineering Technologists. In line with the past decade there was little change in completion of Engineering Technologist qualifications in 2012 and this trend is expected to continue. Over 70% of the engineering team are Professional Engineers. In 2012, completion of Professional Engineer qualifications increased from 6,161 to 6,289 accounting for 21.4% in completion of domestic entry level engineering qualifications. This pattern is set to continue in 2013 reflecting commencements in university entry level courses, but with greater uncertainty concerning TAFE completions. Over the past decade there has been a shift in favour of completions of courses most heavily in demand in the resources and infrastructure sectors, notably to Civil and Process and Resource Engineering and away from historically larger groups like Electrical and Electronic Engineering. However, other groups such as Mechanical and Industrial Engineering and Aerospace Engineering have had more consistent annual completion levels. An unfortunate feature has been the emergence of Professional Engineer completions in Automotive Engineering just as vehicle manufacturing in Australia is to cease. 6.1 What the Statistics Include This chapter looks at annual completions of entry level engineering courses, Bachelor Degrees, Associate Degrees and Advanced Diplomas, in more detail. A small number of universities offer Coursework Masters programs as an entry qualification for Professional Engineer. Most graduates are overseas students seeking to upgrade qualifications from their home country and who subsequently need to negotiate migration formalities before joining the Australian labour market. These graduates are included in the migration statistics covered in the next Chapter. A very small number of domestic graduates also progress through this route, mainly as a means of articulating from Associate Engineer or Engineering Technologists qualifications to another grade. The numbers involved cannot be separately identified causing a small undercount of new graduates to Professional Engineers. But, most are already included in the count of new entrants to engineering by virtue of their existing qualifications. Before moving on two important caveats need some emphasis. The first has already been mentioned; only statistics relating to domestic completions are taken into account. Overseas student who complete entry level engineering qualifications must obtain either permanent or temporary visas under Australia s Engineers Australia 45

60 skilled migration programs in order to work in Australia. These statistics are discussed in the Chapter on Skilled Migration. The second caveat relates to the count of statistics in various engineering specialisations. This issue relates to the way statistics are reported by the universities to Commonwealth authorities. Rather than coding completions to particular specialisations, at times they are attributed to general overflow categories in the statistical framework, causing large discontinuities in annual time series. This problem is most acute for the levels of disaggregation most useful to reader, the four and six digit levels in the Australian and New Zealand Standard Classification of Occupations. The problem can largely be resolved through aggregation to the three digit level, though even here, there are unusually large numbers in catch all other categories like ANZSCO 0300 Engineering and Related Technologies (not further defined) and 0399 Other Engineering and Related Technologies which unfortunately also includes several important engineering specialisations. The following key shows how more familiar engineering specialisations at the four digit level combine into the three digit level statistics reported in this Chapter. Engineering and Related Technologies (not further defined) Process and Resource Engineering includes o Chemical Engineering o Mining Engineering o Materials Engineering o Food Processing Technology Mechanical and Industrial Engineering includes o Mechanical Engineers o Industrial engineers Civil Engineering includes o Civil Engineers o Construction Engineers o Building Services Engineers o Water and Sanitary Engineers o Transport Engineers o Geotechnical Engineers o Ocean Engineers Electrical and Electronic Engineering includes o Electrical Engineers o Electronic Engineers o Computer Engineers o Communication Technologies Aerospace Engineering includes o Aerospace Engineers o Aircraft Maintenance Engineers Maritime Engineering includes o Maritime Engineers o Maritime Construction Engineers Other Engineering includes o Environmental Engineers o Biomedical Engineers o Naval Architects o Other Engineers Engineers Australia 46

61 The statistics covered in this Chapter are compiled in a different data base to the statistics reported in the previous Chapter. There are minor differences between the two data bases, in most cases, low single digit differences and are too small to alter conclusions about trends Labour Market Choices of New Graduates Past editions of the Statistical Overview have that the destination of all domestic students who complete engineering qualifications is the engineering labour market. This is clearly not the case. Although a high proportion of graduates do go directly into the labour market, not all are available for full time work. In addition some graduates go onto post-graduate education on a full time basis and some graduates do not wish to study or enter the labour market. This section reviews statistics from Graduate Careers Australia to consider these options in more detail and to examine how engineering graduates compare to graduates in other fields. Figure 6.1: The Destinations of New Engineering Graduates Compared to New Graduates in General, 2009 to FT Work Engineering FT Work All Fields FT Study Engineering FT Study All Fields Only PT Work Engineering Only PT Work All Fields Not in LF or Study Engineering Not in LF or Study All Fields 80.0 Proportion of New Graduates (%) The destinations of new graduates in the five years from (and including) 2009 are illustrated in Figure 6.1. An average of 64.0% of all new graduates choose to make themselves available for full time work. Engineering graduates are more inclined towards full time work and with an average of 83.7% stand out from counterparts in other fields. Since 2009, the share of all new graduates available for full time work has trended downwards, from 66.0% to 61.6% in However, for engineers the proportion available for full time work has been remarkably stable and close to average each year. There are also wide differences in the choices made by graduates not available for full time work. Among new graduates generally, an average of 11.2% seek out part time and casual work and prefer not to work full time, a share that has increased over time from10.8% in 2009 to 12.4% in Part time or casual work is less important for new engineering graduates with an average share of just 3.4% pursuing this option. Once again this proportion has been fairly stable over time with no evidence of any increase in recent years. On average 19.6% of all new graduates choose full time education, over double the proportion for engineering graduates for whom the average was 8.6%. The proportion choosing full time education has tended to increase for all new graduates, but the evidence of a similar change for engineering graduates is weak. Engineers Australia 47

62 The final group considered in Figure 1 is new graduates who prefer neither full time or part time work nor study, in other words, they choose not to participate in the labour market or education. An average of 5.2% of all new graduates falls into this category. The average for new engineering graduates is lower at 4.3% with wider annual variations. These statistics are consistent with the census statistics discussed in Chapter 2. New engineering graduates are more inclined towards full time work and less inclined towards part time work. On average, about 12.9% do not immediately enter the labour market; 8.6% move into full time education and presumably most join the labour market when these studies have been completed. But about 4.3% choose to withdraw from education and work. These figures suggest that the flow of graduates to the engineering team has been over-stated by this proportion in past years. This year the statistics will be discounted to reflect this effect. 6.3 Engineering Technologists The entry level qualification required to become an Engineering Technologist is completion of an accredited three year full time (or part time equivalent) Bachelor Degree in engineering. Trends for completions of these Degrees since 2001 are shown in Table 6.1. Table 6.1: Domestic Students Completing Three Year Bachelors Degrees in Engineering Men ASCED Specialisation Engineering & Related Technologies Manufacturing Engineering & Technology < 5 < 5 < 5 < Process & Resource Engineering Automotive Engineering & Technology < 5 6 < Mechanical & Industrial Engineering & Technology < Civil Engineering < Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Martime Engineering & Technology < 5 < 5 < 5 < Other Engineering & Technology Total Women 0300 Engineering & Related Technologies < 5 5 < Manufacturing Engineering & Technology Process & Resource Engineering < Automotive Engineering & Technology < Mechanical & Industrial Engineering & Technology Civil Engineering < Geomatic Engineering < Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology Other Engineering & Technology Total All domestic graduations 0300 Engineering & Related Technologies Manufacturing Engineering & Technology Process & Resource Engineering Automotive Engineering & Technology < 5 6 < Mechanical & Industrial Engineering & Technology < Civil Engineering < Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology < 5 < 5 < 5 < Other Engineering & Technology Total Source: Data supplied by DE In recent years, Engineering Technologists have been the smallest component of the engineering team and the number of completions has fluctuated widely from year to year. Numbers have varied from a high of 847 in 2006 to a low of 463 in In 2012, there were 518 completions, up 4.9% from 494 in There were 220 completions for Aeronautical Engineering in 2012 up 28.7% from 171 in 2011; 14.1% were women. The next largest group was Other Engineering with 126 completions, up 24.6% on 2011; 9.6% were women. Engineers Australia 48

63 In 2012, completions in Manufacturing Engineering fell sharply. There were 47 completions in 2011 but one third fewer in 2012; 93.5% of completions were women. In 2001 there were 136 completions in Electrical and Electronic Engineering, and these increased to 244 in Since then completions have collapsed and in 2012 were an all-time low of 36. Process and Resource Engineering had 26 completions in 2012, down from 31 the previous year. Small numbers were scattered across other engineering groups with none in double figures. 6.4 Professional Engineers The entry level qualification necessary to become a Professional Engineer is completion of a four year full time (or equivalent part time) Bachelor Degree in engineering. The majority of students complete this qualification as a stand-alone Degree and statistics for completions of these Degrees are shown in Table Other students complete an equivalent four year Degrees in engineering together with a second Degree in another subject area. Statistics for double Degree completions are shown in Table 6.3. Table 6.2: Domestic Students Completing Four Year Bachelors Degrees in Engineering Men ASCED Specialisation Engineering & Related Technologies Manufacturing Engineering & Technology < 5 < 5 < Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Martime Engineering & Technology Other Engineering & Technology Total Women 0300 Engineering & Related Technologies Manufacturing Engineering & Technology < Process & Resource Engineering Automotive Engineering & Technology <10 0 < 5 < 5 < 5 < Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering < Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology < Other Engineering & Technology Total All domestic graduations 0300 Engineering & Related Technologies Manufacturing Engineering & Technology < 5 < 5 < Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology Other Engineering & Technology Total Source: Data supplied by DE Up until 2010, there has been no clear trend in the completion of four year full time Degrees in engineering. Annual variations ranged from 3,707 in 2006 to just over 4,100 in three years, 2001, 2008 and However, in the last two years an upwards trend has emerged; an increase of 8.9% to 4,540 in 2011, followed by an increase of 3.2% to 4,685 in Table 6.2 includes 248 completions (204 men and 44 women) in 2005 from courses of unknown duration. This situation resulted from coding abnormalities by some universities. Inspection of past completions and completions since 2005 for those universities suggest that the unknown durations were most likely four year courses and they have been treated as such. Engineers Australia 49

64 The largest number of completions was in Other Engineering and Technology with 1,011, up 8.7% on 2011; 14.8% were women. This group contains several important engineering specialisations as well as the residual other. The largest number of completions in a familiar group was 925 in Civil Engineering, down 5.5% on the previous year. This ended a rising trend that commenced in Women accounted for 13.2% of completions in this group. In line with the caveat explained above, 771 completions were in Engineering and Related Technology nfd with 771, up 24% on the previous year; 17.3% of completions were women. There were 643 completions in Mechanical and Industrial Engineering and Technology, marginally down on the 649 last year; 7.3% of completions were women. There were 534 completions in Electrical and Electronic Engineering, up 6.8% from the previous year and ending a continuous downtrend that started in 2003; 8.2% of completions were women. There were 459 completions in Process and Resource Engineering, down 12.4% on last year; 22.7% of completions were by women. Completions in this group have now fallen each year since Completions in Aerospace Engineering continue to increase, albeit slowly, with 208 completions in 2012; 10.1% were women. Finally, there were 22 four year degree completions in Automotive Engineering just as it has been announced that motor vehicle production in Australia is to cease in the next few years. Table 6.3: Domestic Students Completing Four Year Bachelors Double Degrees in Engineering Men ASCED Specialisation Engineering & Related Technologies Manufacturing Engineering & Technology Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering 22 <10 <10 12 <10 6 <10 5 < Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Martime Engineering & Technology < Other Engineering & Technology Total Women 0300 Engineering & Related Technologies Manufacturing Engineering & Technology < 5 < 5 < 5 < Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering < <10 < < 5 < Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology <10 <10 <10 <10 <10 9 < Maritime Engineering & Technology Other Engineering & Technology Total All domestic graduations 0300 Engineering & Related Technologies Manufacturing Engineering & Technology Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering < Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology < Other Engineering & Technology Total Source: Data supplied by DE The totals in Table 6.3 are the ones provided by the Department of Education and are not in all cases the sum of the components in the Table. Statistics on double Degrees are sometimes collected according to engineering discipline, sometimes according to field of second Degree and sometimes according to both. The Department assures us that totals are accurate but the sum of the rows may not always be so. The number of double Degrees in engineering has generally increased since 2001, but in 2012 there were 1,604 completions, marginally lower than the 2011 outcome. Engineers Australia 50

65 The usefulness of the statistics in Table 6.3 is compromised by the fact that 923 or 57.5% of completions were in the Engineering and Related Technology nfd and Other Engineering and Related Technology. Although, the latter contains several important engineering specialisations, the large number of other and not defined completions impedes identification of useful trends; 9.8% of completions were by women. There were 187 completions in Process and Resource Engineering, down 11.4% on 2011; 27.3% of completions were by women. There were 165 completions in Civil Engineering, down 22.5% from the previous year; 23.6% of completions were by women. There were 108 completions in Electrical and Electronic Engineering, down 17.6% on 2011 with 18.5% of completions by women. There were 116 completions in Mechanical and Industrial Engineering compared to 160 in 2011; 26.7% were by women. There were 72 completions in Aerospace Engineering with 13.9% by women. Finally there were 29 double degree completions in Manufacturing Engineering. The proportion of completions of stand alone four year degrees by women was 13.3% in 2012 compared to 19.2% for double degrees. As noted several groups in Table 6.3 had even higher proportion of completions by women, notably Process and Resource Engineering with 27.3%. 6.5 New Degree Qualified Engineers Table 6.4 consolidates the two types of engineering entry level completions. Degree completions of engineering courses by domestic students accounted for 68.7% of all course completions in The Table shows how these outcomes were distributed across different engineering fields. Table 6.4: Domestic Students Completing Bachelors Degrees in Engineering, All Durations Men ASCED Specialisation Engineering & Related Technologies Manufacturing Engineering & Technology <5 <5 < Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Martime Engineering & Technology Other Engineering & Technology Total Women 0300 Engineering & Related Technologies Manufacturing Engineering & Technology Process & Resource Engineering Automotive Engineering & Technology <5 0 <5 <5 <5 < Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology Other Engineering & Technology Total All domestic graduations 0300 Engineering & Related Technologies Manufacturing Engineering & Technology Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology Other Engineering & Technology Total Source: Data supplied by DE Engineers Australia 51

66 The main benefit of the consolidation is to demonstrate that the slump in completions of degree courses in engineering that occurred early last decade is well and truly over. Although there was a hic-cup in 2009, degree level completions in engineering have grown since the middle of the decade and the size of the increase has grown strongly in recent years. 6.6 Associate Engineers Entry to the engineering Team as an Associate engineer requires either a two year full time Associate Degree in engineering or a two year full time Advanced Diploma in engineering. Courses leading to these qualifications are available both as university courses and as TAFE courses. University outcomes were part of statistics covered in Chapter 5 and here are consolidated with statistics of completions of TAFE courses obtained from the National Centre for Vocational Education Research (NCVER) from information provided by State and Territory TAFE agencies. Each year NCVER revises its statistics back to In most years revisions are minor but revisions for the last year or two can be significant. Table 6.5 highlights the university completions and Table 6.6 the TAFE completions. Table 6.5: Domestic Students Completing Associate Degrees and Advanced Diplomas in Engineering at Universities Men ASCED Specialisation Engineering & Related Technologies < < Manufacturing Engineering & Technology <10 <10 < Process & Resource Engineering < 5 < 5 < 5 < Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology <10 <10 <10 <10 < < Civil Engineering <10 12 <10 <10 <10 < Geomatic Engineering 14 <10 15 <10 <10 <10 <10 <10 0 < Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology 24 <10 < Martime Engineering & Technology < Other Engineering & Technology <10 <10 < Total Women 0300 Engineering & Related Technologies < <10 <10 0 < 5 < Manufacturing Engineering & Technology 0 0 < Process & Resource Engineering < Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology 0 <10 0 < < < Civil Engineering <10 <10 <10 <10 <10 < < 5 0 < Geomatic Engineering <10 <10 <10 < < Electrical & Electronic Engineering & Technology 0 <10 <10 <10 < < 5 0 < Aerospace Engineering & Technology <10 < <10 0 < 5 < Maritime Engineering & Technology <10 <10 <10 0 <10 <10 <10 <10 < 5 < 5 < 5 < Other Engineering & Technology 0 <10 <10 0 <10 <10 < Total <10 <10 14 <10 <10 < All domestic graduations 0300 Engineering & Related Technologies Manufacturing Engineering & Technology Process & Resource Engineering < 5 < 5 < Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology < Civil Engineering < Geomatic Engineering < Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology Other Engineering & Technology Total Source: Data supplied by DE The main feature of the university statistics is the recent growth spurt. Completions in the first half of the decade contracted from 133 in 2001 to 83 in 2006, mirroring the change in degree outcomes at the time. Since then annual completions have increased to 515 in 2012 with 57.5% growth in Unfortunately 54.2% of the 2012 outcomes were in Engineering and Related Technology nfd and Other Engineering and Technology which accounted for 279 completions and 30.9% of the year s growth. Beyond that in 2012 there were 94 completions in Civil Engineering, 59 in Mechanical and Industrial Engineering and 49 in Maritime Engineering, three areas where there has been strong growth. Engineers Australia 52

67 Table 6.6: Completions of Associate Degrees and Advanced Diplomas in Engineering from Australian TAFE Colleges ASCED Specialisation Engineering & Related Technologies Manufacturing Engineering & Technology Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Martime Engineering & Technology Other Engineering & Technology Total Women 0300 Engineering & Related Technologies Manufacturing Engineering & Technology Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology Other Engineering & Technology Total All Completions 0300 Engineering & Related Technologies Manufacturing Engineering & Technology Process & Resource Engineering Automotive Engineering & Technology Mechanical & Industrial Engineering & Technology Civil Engineering Geomatic Engineering Electrical & Electronic Engineering & Technology Aerospace Engineering & Technology Maritime Engineering & Technology Other Engineering & Technology TOTAL Source: NCVER, VOCSTATS On-Line Databases TAFE completions are also up in 2012, increasing by 16.7%. However, it has only been in the last two years that an increasing trend has been evident. Most of the period covered by the Table is characterised by fairly large annual movements with no obvious trend. The fields of engineering covered appear fairly regular in the Table but in actual fact are rather State specific and reflect the historical pattern of industry rather than a broad dispersion of courses across fields. For example, Victoria favours courses in Manufacturing and Electrical and Electronic Engineering, NSW and Queensland favour Mechanical and Electrical and Electronic Engineering and Western Australia Civil and Process and Resource Engineering. The proportion of completion of TAFE courses by women was 7.6% in 2012 and not much higher for the universities with 7.8%. 6.7 Annual Additions to the Engineering Team This Section brings together the statistics discussed so far to estimate the annual flows of entry level completions to the engineering team. For this purpose, slight incompatibilities that might arise from different data sources are ignored. In the past, all domestic completions of entry level courses were assumed to available to the engineering labour market. However, the discussion in section 6.2 showed this was not the case; in particular, on average 4.3% of new engineering graduates are not available for work or for full time study and on average, 8.6% are not available for work because they are studying full time. New graduates who study full time can be expected to become available for work when they complete the course they are studying. However, courses can range in length from one year for a full time coursework masters degree to three years or more for doctoral degrees. Without further information about the time profile of completions it is difficult to be accurate about the movements of this group. Accordingly, the existing approach will be continued. Engineers Australia 53

68 However, it is reasonable to adjust statistics to take into account the group that neither participates in the labour market of full time education. To do so requires an assumption that statistics derived from university completions can be applied to TAFE completions. Some of the students who move into full time education are also likely to withdraw from the labour market. Taking this into account, it is not unreasonable to discount completion statistics by 4.5% when estimating the flow of new entrants to the engineering team. Table 6.7 show these estimates which are illustrated in Figure 6.2. Table 6.7: Annual Changes in the Engineering Team from Course Completions by Citizens & Permanent Residents Source Men Associate Engineers Universities TAFE Colleges Sub-total Engineering Technologists Professional Engineers Four year degree Four year double degree Sub-total Total completions Discounted for non-participation Women Associate Engineers Universities <10 14 <10 <10 < TAFE Colleges Sub-total Engineering Technologists Professional Engineers Four year degree Four year double degree Sub-total Engineering Team Discounted for non-participation Total Associate Engineers Universities TAFE Colleges Sub-total Engineering Technologists Professional Engineers Four year degree Four year double degree Sub-total Engineering Team Discounted for non-participation The latest official statistics are for 2012 when 8,723 new engineers were added to the engineering labour force from 9,134 completions. The figures for 2013 in Table 6.7 are projections 15 based on the actual growth achieved in the latest statistics. The projections show that in 2013 an additional 9,296 new engineers joined the engineering labour market from 9,734 completions; a growth rate of 6.6%. In the past decade, the annual increase in the engineering team from education completions grew from 6,942 to 9,296, an overall increase of 33.9%. The average growth rate over this period was 3.0% per year. In recent years annual growth has increased; in the last three years average growth has been 6.6% per year. Women engineers accounted for 15.2% of these changes over the last 10 years but this share has fallen to 13.2% over the last three years. 15 Annual changes in gender level outcomes are also used to estimate outcomes for 2013 (shown in green). A similar estimate for 2012 was made in the last edition of the Statistical Overview. Growth in engineering domestic entry level course completions was estimated to grow by 3.0% from 2011 to The actual outcome was over twice as large. Data revisions showed that actual outcomes for 2011 were understated by 258, some 0.6% higher than reported in the 2013 Edition. Engineers Australia 54

69 Figure 6.2: The Annual Flow into the Engineering Team from Course Completions by Citizens and Permanent Residents Associate Engineers Engineering Technologists Professional Engineers Numbers The number of new Associate Engineers each year has increased from 1,373 in 2003 to 2,312 in 2013, an increase of 68.4%. Average growth over these 10 years was 6.5% per year, increasing to 13.8% per year during the last three years. There are fewer women Associate Engineers than in any other category; their share over the last ten years has been 8.8%, falling to 7.2% in the last three years. The smallest component of education completions is Engineering Technologists whose annual inflow in 2003 was 584 but fell away to 488 in The ten year average growth rate was -0.6%. There were proportionally more women Technologists than in any other category; an average 21.4% over the ten years indicated and 20.4% in the last three years. The largest component of the engineering team is Professional Engineers whose annual inflow numbers increased from 4,984 in 2003 to 6,296 in The ten year average growth rate was 3.0% but this accelerated sharply to be 6.6% in the last three years. The proportion of new women Professional Engineers has fallen over time; the share averaged 15.2% over the ten years 2003 to 2013 but fell to 13.2% over the past three years. Engineers Australia 55

70 Chapter 7 Supply and Skilled Migration Main Points This Chapter reviews trends in skilled migration of engineers. Both permanent and temporary migration are considered. The period covered is from to the end of , a period that covers the resources boom, the labour market collapse caused by the global financial crisis and the period since then to the present day. Permanent migration of engineers has continued to grow, albeit more slowly in the past two years. The result has been that in permanent migration of engineers was at an all-time high, far higher than levels recorded during the resources and infrastructure boom. The May 2014 Budget announced that the skilled migration target for was unchanged from the previous year. Unlike permanent migration, temporary migration under 457 visas is not capped in Australia s annual migration plans. Temporary migration is expected to operate as an automatic stabilizer with numbers increasing when demand is high and there are shortages of engineers and falling when demand is low. Temporary migration statistics have indeed fallen in each of the past two years with a fairly substantial fall in demonstrating that the intent of the policy has worked. However, when permanent and temporary migration of engineers are combined, the total intake in , 14,925, is the third highest on record and much higher than the intakes during the years of the resources and infrastructure booms. Continuing increases in permanent skilled migration substantially offset the automatic stabilising effect of temporary migration. The conclusions of this Chapter are largely unaffected by including or excluding several occupations which have shown unusual increases in recent years. 7.1 Australia s Skilled Migration Policy Australia has a long history of skilled migration, particularly in engineering. Following major revision, present policies have been in place since There are two objectives of these policies; first, medium to longer term supplementation of Australia s skill base in areas where the output of the education system is not sufficient for future needs and second, to meet the short term requirements of employers experiencing skills shortages. The first objective is covered by an annual migration cap set out in the May budget. Short term visas, on the other hand, are not limited. Employers are expected to deal with skill shortages by taking advantage of fairly liberal arrangements to engage short term skilled migrants on 457 visas. These visas can be for periods as short as three to four months or up to four years. Short term skilled migration is expected to operate as an automatic stabiliser; increasing when labour markets are tight and there are skill shortages and falling when labour markets ease and skill shortages disappear. The presumption here is that the economy is growing fast enough to absorb new domestic graduates and annual permanent migration. Employers can elect to sponsor temporary migrants for permanent visas. When this occurs, the normal arrangements for permanent migration apply including the annual cap on visa numbers and formal skills assessment. It is important to realise that temporary skilled migrants work in Australia without any assessment of their skills other than by the employer who engages them. Since 2010, the Skilled Occupation List (SOL) has been compiled by the former Australian Workplace Productivity Agency (AWPA) and has been supplemented by occupations nominated in State and Territory Skilled Migration Plans. In practical terms, unless an engineering occupation is on the Engineers Australia 56

71 supplemented SOL, entry to Australia is unlikely. For this reason, Engineers Australia compiles skilled migration statistics according to the supplemented SOL. There have been no changes to the engineering occupations on this list since it came into force. AWPA used four criteria to establish the SOL and to conduct its annual reviews. These criteria are as follows: Long training lead time in specialized skills High Degree of relationship between area of training and subsequent employment High risk of labour market and economic disruption if the skill is in short supply Sufficient high quality information to assess future skills requirements. AWPA was abolished in the 2014 Budget and this decision came into effect on 1 July AWPA functions were to be absorbed into the Department of Industry, but at this stage, there has been no advice about the implications for skilled migration policies. 7.2 Assessing Overseas Engineering Qualifications Aspiring permanent skilled migrants must have their educational qualifications and labour market experience assessed by an assessment authority appointed by the Department of Immigration and Border Protection (DIBP) prior to submitting their application for a visa. For engineers, Engineers Australia is the authorised assessing authority for nearly all engineering occupations. Assessments are undertaken consistent with Engineers Australia s stage 1 competencies. These competencies are the basis for Engineers Australia s accreditation of university entry level engineering courses and for all new members. Engineering qualifications can be recognised through several pathways 16 : Qualifications may be treated as accredited qualifications if they are: Australian qualifications; Accredited under the Washington Accord which is an agreement between international engineering accreditation bodies 17 to recognise the equivalence of each other s undergraduate qualifications for Professional Engineers (the equivalent of an Australian four year full time Bachelors Degree in engineering); Accredited under the Sydney Accord which is an agreement between international engineering accreditation bodies 18 to recognise the equivalence of each other s undergraduate educational qualifications for Engineering Technologists (the equivalent of an Australian three year full time Bachelor Degree in engineering). Accredited under the Dublin Accord which is an agreement between international engineering accreditation bodies 19 to recognise each other s qualifications for Engineering Technicians (the equivalent of an Australian two year full time Associate Degree or Advanced Diploma). Qualifications that are not accredited can be recognised through a stage 1 competency assessment in which applicants are required to demonstrate that their engineering knowledge and skills meet the competency standards for the engineering occupation they intend to apply for. The competency standards applied are available on Engineers Australia s web-site 20. Engineers who come to Australia on temporary 457 visas do not have their qualifications assessed. Providing their visa application is accompanied by an employer s offer of employment and complies with The signatories to the Washington Accord are Canada, Hong Kong SAR, Ireland, New Zealand, South Africa, the United Kingdom, the United States of America and Australia. 18 The signatories to the Sydney Accord are Canada, Hong Kong SAR, Ireland, New Zealand, South Africa, the United Kingdom and Australia. 19 The signatories of the Dublin Accord are Canada, Ireland, Korea, New Zealand, UK, USA and Australia 20 See Engineers Australia 57

72 conditions relating to labour market testing and employment conditions, skills assessments are deemed as unnecessary. 7.3 Trends in the Aggregate Skilled Migration of Engineers This Section examines aggregate trends in the skilled migration of engineers. The framework of the engineering team is used in combination with engineering occupations on the extended SOL. The annual intakes of skilled engineers since are shown in Table 7.1. The aggregate trend is illustrated in Figure 7.1 and Figures 7.2 and 7.3 illustrate the permanent and temporary intakes divide into the components of the engineering team. Table 7.1: An Overview of Skilled Migration of Engineers to Australia Permanent visas Professional engineers Engineering technologists Engineering associates Total Temporary visas Professional engineers Engineering technologists Engineering associates Total All visas Professional engineers Engineering technologists Engineering associates Total Source: Statistics supplied by DIBP Figure 7.1: Skilled Migration Visas Granted to Engineering SOL Occupations Permanent visas Temporary visas Number of visas In , 5,206 engineers came to Australia under skilled migration programs. By , the number had increased to 14,925. Average growth over this ten year period was 12.5% per year compared to average growth of 3.0% in the annual flow of domestic education completions. Figure 7.1 shows that skilled migration peaked in In the two years since, the annual intake has contracted Engineers Australia 58

73 by 10.5% per year. However, this change still resulted in an annual intake last year 286% higher than in Permanent migration of engineers was 2,946 in , well below the corresponding level of domestic completions which were 6,942. By , the annual intake of permanent migrants had increased to 9,424 which was higher than corresponding domestic completions of 9,296. The average growth rate of permanent skilled migration was 13.4%. Although growth in the annual intake has slowed since the global financial crisis, average growth in the past two years remained fairly high at 5.5%. As a result, the permanent intake of engineers in the year ending 30 June 2014 was the highest on record. Temporary migration of engineers was 2,260 in and increased to a peak of 10,160 in Since then the automatic stabiliser effect of temporary skilled migration has kicked in reducing the numbers to 5,501. The ten year average growth rate was 14.8% per year, but during the contraction of the last two years, this fell to -26.0% per year. The key point is that the reduced level of temporary skilled migration was significantly offset by continued strong growth in permanent skilled migration of engineers. A later Chapter will compare the trends discussed here with prevailing conditions in the engineering labour market. This comparison shows that there is a disconnect between skilled migration policies and conditions in the labour market. 7.4 Permanent Visas This section looks in more detail at permanent visas granted to engineering occupations on the extended SOL. Figure 7.2 illustrated how the overall trend in permanent visas divides into the components of the engineering team and Table 7.2 sets out the statistics for individual occupations in each component. Figure 7.2: Permanent Visas Granted to Engineering Occupations Professional engineers Engineering technologists Engineering associates Number of visas In , 9,424 permanent visas were granted to migrant engineers eligible to be included in the engineering team, an increase of 9.8% over ; Professional engineers increased by 11.5% from 7,630 to 8,509 Engineering Technologists fell by 12.0% from 407 to 358 Associate Engineers increased by 1.6% from 548 to 557 Among Professional Engineers, important changes last year included: Civil Engineers increased by 14.5% from 1,025 to 1,174 Engineers Australia 59

74 Table 7.2: Engineering Specialisations Granted Permanent Migration Visas Specialisation Professionals Chemical Engineer Materials Engineer Civil Engineer Geotechnical Engineer Quantity Surveyor Structural Engineer Transport Engineer Electrical Engineer Electronics Engineer Industrial Engineer Mechanical Engineer Production Engineer Mining Engineer Petroleum Engineer Aeronautical Engineer Agricultural Engineer Biomedical Engineer Environmental Engineer Naval Architect Other Engineering Professionals Telecommunications Engineer Telecommunications Network Engineer Software Engineer Computer N/W & Systems Engineer TOTAL Engineering Technologists Associates Civil Electrical Electronics Mechanical Other Engineering Telecommunications TOTAL OVERALL TOTAL Source: Statistics supplied by DIAC Mechanical Engineers increased by 8.0% from 973 to 1,051 Electrical Engineers increased 19.3% from 435 to 519 Electronics Engineers fell 21.5% from 582 to 457 Chemical Engineers increased 29.0% from 231 to 298 Combined increase of 17.5% from 320 to 376 for Industrial and Production Engineers Mining Engineers increased from 122 to 146 Petroleum Engineers increased from 51 to 61 These movements continue the pattern of change during recent years. The increase in the numbers of permanent visas granted accelerated from 1.0% in to 9.8% in Two occupations; Software Engineers and Computer Network and Systems Engineers, both Professional Engineer occupations, had a pronounced influence on this result. In , permanent visas granted for these occupations increased by 1,094 compared to an aggregate change of 282 for Professional Engineers and in for 788 visas compared to 879 at the aggregate level. Yet five years ago the visas granted for these occupations were just 75 and zero, respectively. This observation prompted recalculation of growth rates for Professional Engineers to investigate the impact of this change. Some key observations are: Engineers Australia 60

75 Average annual growth in the number of permanent visas granted to the engineering team since 2000 was lower without the two occupations; 13.4% compared to 16.8%. The growth rate for for the engineering team was 4.3% instead of 9.8% The 1.0% growth rate for the engineering team in turned into a fall of 14.5% in Whether Software Engineers and Computer Network and Systems Network Engineers are included or not, the number of permanent visas granted to Professional Engineers and to the engineering team as a whole continues to grow with annual increases as high, or higher, than during the resources sector construction boom. The May 2014 Budget announced that the skilled migration target for is unchanged from the previous year. However, at the time of writing planning caps for individual engineering occupations had not yet been announced. 7.5 Temporary Visas This section looks in more detail at temporary visas granted to engineering occupations on the extended SOL. Figure 7.3 illustrated how the overall trend in temporary visas divides into the components of the engineering team and Table 7.3 sets out the statistics for individual occupations in each component. Figure 7.3 shows that the automatic stabilizer function of temporary skilled migration of engineers has indeed worked. The peak intake of temporary engineers was 10,160 in In , temporary migration fell by 18.5% to 8,276 and in last financial year by a further 33.5% to 5,501. However, as can be seen in Figure 7.3, the intake last year was higher than in and earlier years. Figure 7.3: Temporary 457 visas granted to engineering team occupations Professional engineers Engineering technologists Engineering associates Number of visas As was the case for permanent skilled migration, there were unexpected large numbers of temporary visas granted to Software Engineers and Computer Network and Systems Engineers. In addition, during the past three years the number of Mechanical Engineering Technicians has increased to about half the annual intake of temporary Engineering Associates. The reasons why numbers in these occupations have increased are unclear but it is worth examining whether their inclusion makes any material difference to how the automatic stabilizing effect has worked. Figure 2 reworks Figure 1 to compare the trends in temporary visas granted with and without these occupations. Engineers Australia 61

76 It is evident that whether the three occupations in question are included or not, the automatic stabilizer effect works much the same way with a fairly constant scale difference between the two measures for most of the period but with an increasing difference more recently reflecting the increase in Mechanical Engineering Technicians. The issue then becomes; is the level of temporary skilled migration of engineers too high given the present labour market circumstances? Table 7.3: Temporary Visas Granted to Engineers on the SOL in the Skilled Migration Program Professionals ANZSCO Occupation Chemical engineer Materials engineer Civil engineer Geotechnical engineer Quantity surveyor Structural engineer Transport engineer Electrical engineer Electronic engineer Industrial engineer Mechanical engineer Production or plant engineer Mining engineer (excl petroleum) Petroleum engineer Aeronautical engineer Agricultural engineer < 5 < 5 < 5 < 5 10 < 5 < 5 < 5 10 <5 < Biomedical engineer Environmental engineer Naval architect < Engineering professionals nec* Software engineer Telecommunications engineer Telecommunications network engineer Computer network & systems engineer* ICT Systems Test engineer* Total professionals Technologists Engineering technologist Associates Civil engineering draftsperson Civil engineering technician Electrical engineering draftsperson Electrical engineering technician Radiocommunications technician Telecommunications field engineer Telecommunications network planner < 5 <5 <5 < Telecommunications technical officer Electronic engineer draftsperson* Electronic engineers technician* Mechanical engineering draftsperson* Mechanical engineering technician* Metallurgical or materials technician* Mine deputy* < Building & engineering technicians nec* Total associates TOTAL SOL Source: Statistics supplied by DIBP The statistics examined are for new temporary migrant visas not the stock of outstanding temporary visas. The stock of visas could be slow to adjust because employers have temporary migrants under contracts not yet concluded but scheduled for conclusion in the near future. Another reason is that employers may be retaining highly competent temporary migrants while sponsoring them for permanent visas. However, these reasons are not particularly relevant to decisions to take on new temporary skilled migrants. Although it is possible that employers in some parts of the country are still experiencing difficulties in recruiting particular engineering specializations in some geographic locations, the reductions in demand for engineers has been widespread and general skill shortages are improbable. Further evidence is shown in Table 1 which shows the widespread nature of the occupational changes that have occurred: Temporary migration fell for all except one Professional Engineer occupation. The exception was Software Engineer where the number of temporary visas increased from 1,020 to 1,061. Engineers Australia 62

77 The number of temporary visas granted to Engineering Technologists and to Associate Engineers fell in all occupations. Some of the more important changes include: o Civil Engineers: down from 642 last year to 231 in with intakes over 1,000 in several years. o Electrical Engineers: down from 324 to 168 (450 in ). o Mechanical Engineers: down from 612 to 296 (peak of 840 pre GFC) o Petroleum Engineers: numbers remain consistently high at 212 in , slightly lower than 222 the previous year. o Professional Engineers (not elsewhere included): down from 507 to 233 (660 in o As already mentioned, the large numbers of Mechanical Engineering Technicians: down slightly from 1,273 to 1,120. Yet the overall outcome for was that employers took on 5,501 new temporary skilled migrant engineers on 457 visas. When this outcome is combined with the number of permanent migrant engineers, the overall implications for the supply of engineers become apparent. The unusually large numbers in the three occupations highlighted warrant further investigation, but in the final analysis they are integral components of the migration intakes. Engineers Australia 63

78 Chapter 8 Industry Distribution of Engineers Main Points The importance of engineering does not lie in its share of Australian employment. In 2006, engineering employment was just 2.1% of total employment and 8.1% of skilled employment and even following a period of rapid growth, these shares were just 2.5% and 8.5% in Instead the importance of engineering lies in the critical services provided by engineers, services that cannot be provided by other professions. Between 2006 and 2011, total employment in Australia grew by 2.0% per year. Skilled employment grew over twice as fast, 4.6% per year. Employment of people with recognised engineering qualifications grew faster still, by 5.5% per year and those of this group who were employed in engineering occupations even faster, by 6.0% per year. A characteristic of engineering employment is its widespread nature. Engineers are employed in every broad industry group and in nearly every one of 237 detailed industries examined. Common perceptions that engineers are only employed in a limited number of industries are misleading and working on this basis can lead to inappropriate conclusions and inappropriate public policies. A large number of engineers are employed in industries that have experienced very strong growth such as mining, construction and the utilities industries. However, just as many engineers are employed in industries that have experienced slow growth, notably in manufacturing industries and the three levels of public administration. There were 52 industries in a list of 237 examined, that employed at least 1,000 qualified engineers and a very long tail of 185 industries that employed fewer than 1,000. These industries should not be ignored because they accounted for 48,013 or 18.9% of engineering employment. Industries employing more than 1,000 engineers were ranked according to the number of engineers employed. The top of the list in 2011 was the Architectural, Engineering and Technical Services industry, commonly referred to as engineering consulting, which employed 38,984 qualified engineers. This industry has experienced strong growth (8.9% per year) and a particularly high proportion of engineers (over 90%) were employed in engineering occupations. The top ten ranked industries comprised of some industries that had experienced strong employment growth and others that had not. At the national level, the first ranked resources industry was metal ore mining ranked 12 th followed by oil and gas extraction at 19 th and coal mining at 24 th. These industries were far more important in other jurisdictions, for example in Western Australia metal ore mining ranked 2 nd and oil and gas extraction ranked 3 rd and in Queensland coal mining ranked 3 rd and oil and gas extraction 10 th. 8.1 Industries and Industry Statistics This Chapter reviews the industry structure of engineering employment and how it has changed. It draws on an earlier study which systematically examined the size, growth in and character of the demand for engineers in Australian industries at different levels of aggregation 21. Industries are defined according to the ABS Australian and New Zealand Standard Industry Classification (ANZSIC) 22. Statistics are drawn from the 2006 and 2011 Population Censuses and were compiled using the definitions set out earlier. 21 Engineers Australia, Engineers in Industry; The Size, Growth and Character of Employment in Australia, April 2013, Engineers Australia 64

79 ANZSIC is a hierarchical system with broad industry groups at the highest level of aggregation with each group then broken down into more detailed industries. There are 19 broad industry groups (one digit level) and Section 8.2 examines engineering employment at this level comparing it to skilled employment generally and to overall employment in the economy. The study referenced above examined 237 detailed industries below the group level; 16 manufacturing industries at the two-digit level and 221 industries in the other 18 groups at the three-digit level. Four comparative benchmarks are used. The first is national annual growth in employment. In this measure educational qualifications are not considered. The second applies the filter of skilled employment defined as employment of people who have at least an Associate Degree or Advanced Diploma in a recognized field of study. This definition goes beyond the common definition of skilled employment as trades-people or para-trades people to establish a comparison with engineering at the tertiary level. The benchmark applied is national annual growth in skilled employment. The thirds benchmark applies the filter of engineering qualifications to skilled employment. The measure used is annual national growth in employment of this segment of the skilled workforce. The fourth benchmark is based on the importance of people who have appropriate engineering qualifications and who are employed in engineering occupations. This is the group of primary interest when analysing engineering employment and the measure used is national annual growth in the group s employment. 8.2 Employment at Industry Group Level This Section looks at employment in 19 broad industry groups and how engineering employment compares. Table 8.1 shows statistics for general employment, skilled employment, the employment of people with engineering qualifications and the portion of this group who are employed in engineering occupations for each of the 19 industry groups. Table 8.1 is important to establish the scale of employment in each of these groups and to establish the relative sizes of the different industry groups. Discussion is assisted by Table 8.2 which shows the compound annual growth rates between 2006 and 2011 for the groups set out in Table 8.1. In 2006, 9,104,187 people were employed in Australia and 46.1% were women. By 2011, employment had increased to 10,058,325; an overall increase of 10.5%, equivalent to compound growth of 2.0% per year. Employment growth was higher for women (2.3% per year) than for men (1.8% per annum) with the result that by 2011 women accounted for 46.6% of employment. In 2006, the skilled segment already accounted for 26.3% of employment, a share that increased substantially in the following five years to 29.8% as skilled employment grew much faster than total employment. Overall numbers increased from 2,397,323 in 2006 to 3,000,549 in 2011, growing by 25.2%, equivalent to annual compound growth of 4.6% per year. Women formed the majority of skilled employment, 52.5% in 2006 and 53.0% in People with appropriate engineering qualifications are relatively small components of total and skilled employment. In 2006, there were 194,570 people with engineering qualifications employed; 2.1% of total employment and 8.1% of skilled employment. The participation of women contrasted sharply with the skilled segment with a share of just 10.3%. Employment growth among people with engineering qualifications was appreciably faster than for skilled or total employment; 5.5% per year compared to 4.6% per year and 2.0% per year, respectively. By 2011, employment had increased to 254,515 and the share of total employment had increased to 2.5% and the share of skilled employment to 8.5%. Less than two-thirds of people with appropriate engineering qualifications are employed in engineering occupations, but it was among this segment that employment growth was the highest. In 2006, there were 122,258 people with engineering qualifications employed in engineering occupations; 1.3% of total employment and 5.1% of skilled employment. Demand pressures increased employment by compound 6.0% per year to 163,912 in 2011, still just 1.6% of total employment and 5.5% of skilled employment. Engineers Australia 65

80 Table 8.1: Engineering Employment in the Context of General and Skilled Employment, 2006 and Industry General Employment Skilled Employment Qualified in Engineering Employed in Engineering Group Men Women Total Men Women Total Men Women Total Men Women Total Agriculture, Forestry & Fishing Mining Manufacturing Electricity, Gas, Water & Waste Services Construction Wholesale Trade Retail Trade Accommodation & Food Services Transport, Postal & Warehousing Information Media & Telecommunications Financial & Insurance Services Rental, Hiring & Real Estate Services Professional, Scientific & Technical Services Administrative & Support Services Public Administration & Safety Education & Training Health Care & Social Assistance Arts & Recreation Services Other Services Inadequately Described TOTAL Agriculture, Forestry & Fishing Mining Manufacturing Electricity, Gas, Water & Waste Services Construction Wholesale Trade Retail Trade Accommodation & Food Services Transport, Postal & Warehousing Information Media & Telecommunications Financial & Insurance Services Rental, Hiring & Real Estate Services Professional, Scientific & Technical Services Administrative & Support Services Public Administration & Safety Education & Training Health Care & Social Assistance Arts & Recreation Services Other Services Inadequately Described TOTAL Source: ABS, 2006 and 2011 Population Census, Compiled Using TableBuilder Pro Table 8.2: Annual Growth in General, Skilled and Engineering Employment, Industry Groups, 2006 to 2011 Industry General Skilled Qualified Engineering Group Employment Employment Engineers Occupations Agriculture, Forestry & Fishing Mining Manufacturing Electricity, Gas, Water & Waste Services Construction Wholesale Trade Retail Trade Accommodation & Food Services Transport, Postal & Warehousing Information Media & Telecommunications Financial & Insurance Services Rental, Hiring & Real Estate Services Professional, Scientific & Technical Services Administrative & Support Services Public Administration & Safety Education & Training Health Care & Social Assistance Arts & Recreation Services Other Services TOTAL Source: Estimated from Statistics Compiled from ABS, 2006 and 2011 Population Censuses Engineers Australia 66

81 Turning to the industry groups, people with appropriate engineering qualifications are employed in every group, including some not usually associated with engineering. In every industry group some of this employment is in engineering occupations. All too often this wide spread of employment is neglected by focusing on industries where demand is highest or the employment of engineers is highest. Some additional points include: Skilled employment growth grew faster than total employment in eighteen of the nineteen industry groups. Growth in the employment of people with engineering qualifications was part of more widespread growth in skilled employment across all but one industry group and not confined to traditional engineering industries. Economy wide demand for people with engineering qualifications to be employed in engineering occupations was widespread among industry groups and not confined to headline groups such as mining. Particularly strong engineering employment growth was recorded in industries, including o Mining; growth in qualified engineers 13.0% per year; growth in engineering occupations 13.1% per year o Electricity, Gas, Water and Waste; growth in qualified engineers 8.0% per year; growth in engineering occupations 8.1% per year o Construction; growth in qualified engineers 8.9% per year; growth in engineering occupations 9.8% per year o Transport, Postal and Warehousing; growth in qualified engineers 6.9% per year; growth in engineering occupations 7.0% per year o Financial and Insurance Services; growth in qualified engineers 5.1%; growth in engineering occupations 7.7% per year o Professional, Scientific and Technical Services; growth in qualified engineers 7.4% per year; growth in engineering occupations 7.7% per year o Administrative and Support Services; growth in qualified engineers 5.4% per year; growth in engineering occupations 6.0% per year o Arts and Recreation Services; growth in qualified engineers 6.7% per year; growth in engineering occupations 7.1% per year o Other Services; growth in qualified engineers 5.4% per year; growth in engineering occupations 6.8% per year. These industries highlight the exceptionally diverse nature of engineering employment; by focusing on some industries and neglecting the diversity, inappropriate conclusions can be drawn leading to inappropriate policy decisions. Similarly, it is important to not just focus on industries where engineering employment is growing rapidly. The industries in the above dot points in 2011 accounted for 138,861 or 54.6% of employed qualified engineers and 101,505, or 40% of engineers employed in engineering occupations. Some industries where employment growth has not been as spectacular but where large numbers of engineers are employed include: Manufacturing; growth in qualified engineers 2.2% per year; growth in engineering occupations 2.3% per year Wholesale Trade; growth in qualified engineers 4.1% per year; growth in engineering occupations 4.1% per year Information Media and Telecommunications; growth in qualified engineers 4.0% per year; growth in engineering occupations 5.1% per year Public Administration and Safety; growth in qualified engineers 2.4% per year; growth in engineering occupations 1.8% per year Education and Training; growth in qualified engineers 4.3% per year; growth in engineering occupations 4.0% per year In 2011, these industries accounted for 89,596 or 35.2% of qualified engineers with 56,479 of them employed in engineering occupations accounting for 34.5% of those employed in these occupations. Engineers Australia 67

82 8.3 Industries with Large Engineering Employment Included in the 237 detailed industries studied were 52 that in 2011 employed at least 1,000 people with appropriate engineering qualifications. Figure 8.1, shows that the first 10 industries, ranked according to engineering employment, employed 105,717 qualified engineers of whom 84,738 were in engineering occupations; these figures were 41.5% and 51.7% of the total employment of these segments and the high proportion employed in engineering occupations, 80.2%, has no doubt contributed to some perceptions that engineers are employed in a narrow range of industries. Figure 8.1: Employment of Qualified Engineers and Employment in Engineering Occupations in Industries Employing at Least 1,000 Engineers Qualified engineers Engineering Occupations Numbers to to to to to 52 Industry Rank Order The number of engineers employed in successive groups of 10 industries fall rapidly but the numbers involved are important. Industries ranked from 11 to 20 employed 38,644 or 15.2% of qualified engineers and 29,861 of them were employed in engineering occupations, a proportion of 77.3%. Industries ranked from 21 to 30 employed 16,479 or 6.5% of qualified engineers and 7,670 were employed in engineering occupations, a proportion of 46.5%. Industries ranked from 31 to 52 employed 15,257 or 6.0% of qualified engineers and 7,041 were employed in engineering occupations, a proportion of 46.1%. Many of the industries that employ most engineers do not necessarily accord with common perceptions. To clarify this point it becomes useful to investigate the rank order of industries employing engineers in more detail. The first 10 industries in the rank order are: 1. Architectural, Engineering and Technical Services o Employment of qualified engineers; 38,984 o Growth; 8.9% per year o Share employed in engineering occupations; 90.5% 2. Computer System Design and Related Services o Employment of qualified engineers; 12,073 o Growth; 6.0% per year o Share employed in engineering occupations; 77.0% 3. Machinery and Equipment Manufacturing o Employment of qualified engineers; 11,353 o Growth; 2.0% per year o Share of employment in engineering occupations; 72.4% Engineers Australia 68

83 4. Heavy and Civil Engineering Construction o Employment of qualified engineers; 6,972 o Growth; 12.9% per annum o Share of employment in engineering occupations; 86.2% 5 Tertiary Education o Employment of qualified engineers; 6,937 o Growth; 4.5% per year o Share of employment in engineering occupations; 70.8% 6 Transport Equipment Manufacturing o Employment of qualified engineers; 6,911 o Growth; 5.1% per year o Share employed in engineering occupations; 70.1% 7 Telecommunications Services o Employment of qualified engineers; 6,264 o Growth; 4.5% per year o Share in engineering occupations; 75.7% 8 Other Machinery and Equipment Wholesaling o Employment of qualified engineers; 6,091 o Growth; 4.9% per year o Share in engineering occupations; 63.1% 9. Defence o Employment of qualified engineers; 5,397 o Growth; 2.1% per year o Share in engineering occupations; 76.2% 10. Management and Related Consulting Services o Employment of qualified engineers; 4,735 o Growth; 7.0% per year o Share in engineering occupations; 74.5% The largest employer of qualified engineers is the Architectural, Engineering and Technical Services industry, commonly referred to as engineering consulting. This industry employed over three times as many qualified engineers as the next largest, the Computer Design and Related Services industry. Both industries are part of the Professional, Scientific and Technical Services group which also includes the tenth largest employer, Management and Related Consulting Services. This group experienced above average growth in engineering employment. Two industries, Machinery and Equipment Manufacturing and Transport Equipment are in the Manufacturing group which experienced below average engineering growth which was also less than average growth in skilled employment. These industries reinforce the importance of Manufacturing to engineering employment. Heavy and Civil Engineering Construction, part of the Construction group, experienced above average growth of 12.9% per year and was one of the industries beset by skill shortages a few years ago. However, employment in this industry was less than half employment in the two Manufacturing industries. Tertiary Education, part of the Education and Training group, also experienced below average growth in engineering employment. This situation was repeated in Telecommunications Services, part of the Information Media and Telecommunications group. Of the top 10 ranked industries, the slowest growth in employment of qualified engineers was experienced in the Defence industry, part of the Public Administration and Safety group. Other Machinery and Equipment Wholesaling was the 8th largest employer of qualified engineers and its rank clarifies the role of the Wholesale Trade group as an engineering employer. Industries ranked 11 to 20 include: 11. Air and Space Transport o Employment of qualified engineers; 4,585 o Growth; 5.2% per year o Share in engineering occupations; 79.4% Engineers Australia 69

84 12. Metal Ore Mining o Employment of qualified engineers; 4,467 o Growth; 12.4% per year o Share in engineering occupations; 85.3% 13. State Government Administration o Employment of qualified engineers; 4,391 o Growth; -0.3% per year o Share in engineering occupations; 76.4% 14. Local Government Administration o Employment of qualified engineers; 4,224 o Growth; 3.3% per year o Share in engineering occupations; 79.9% 15. Primary Metal and Metal Products Manufacturing o Employment of qualified engineers; 4,202 o Growth; 3.2% per year o Share in engineering occupations; 70.7% 16. Non-Residential Building Construction o Employment of qualified engineers; 3,513 o Growth; 9.2% per year o Share in engineering occupations; 87.7% 17. Water Supply, Sewerage and Drainage Services o Employment of qualified engineers;; 3,477 o Growth; 5.7% per year o Share in engineering occupations; 81.3% 18. Electricity Distribution o Employment of qualified engineers; 3,284 o Growth; 11.3% per year o Share in engineering occupations; 79.5% 19. Oil and Gas Extraction o Employment of qualified engineers; 3,264 o Growth; 18.7% per year o Share in engineering occupations; 82.4% 20. Building Installation Services o Employment of qualified engineers; 3,237 o Growth; 8.5% per year o Share in engineering occupations; 46.3% The first mining industry in the list, metal ore mining is ranked 12 th in the national rank order. However, in Western Australia this is the 2 nd highest employer of engineers. Similarly, the oil and gas extraction industry is ranked 19 th in the national list but is 3 rd in the Western Australian list and 10 th in the Queensland list. Coal mining is shown below as ranked 24 th in the national list but comes in 3 rd in Queensland. The rest of the national rank order is: 21. Food Product Manufacturing o Employment of qualified engineers; 3,192 o Growth; 5.0%per year o Share in engineering occupations; 45.7% 22. Cafes, Restaurants and Takeaway Food Services o Employment of qualified engineers; 3,025 o Growth; 8.3% per year o Share in engineering occupations; 2.5% 23. Manufacturing, not further defined o Employment of qualified engineers; 2,933 o Growth; 3.3% per year o Share in engineering occupations; 57.9% Engineers Australia 70

85 24. Coal Mining o Employment of qualified engineers; 2,562 o Growth; 12.7% per year o Share in engineering occupations; 82.4% 25. Residential Building Construction o Employment of qualified engineers; 2,560 o Growth; 3.9% per year o Share in engineering occupations; 69.6% 26. Basic Chemicals and Chemical Product Manufacturing o Employment of qualified engineers; 2,554 o Growth; -1.5% per year o Share in engineering occupations; 66.6% 27. Machinery and Equipment Repair and Maintenance o Employment of qualified engineers; 2,308 o Growth; 7.1% per year o Share in engineering occupations; 39.1% 28. Public Order and Safety Services o Employment of qualified engineers; 2,173 o Growth; 3.6% per year o Share in engineering occupations; 28.7% 29. Scientific Research Services o Employment of qualified engineers; 2,168 o Growth; 2.1% per year o Share in engineering occupations; 75.0% 30. Depository Financial Intermediation o Employment of qualified engineers; 2,130 o Growth;11.0% per year o Share in engineering occupations; 53.9% 31. Fabricated Metal Product Manufacturing o Employment of qualified engineers; 2,059 o Growth; 5.2% per year o Share in engineering occupations; 58.7% 32. Central Government Administration o Employment of qualified engineers; 1,921 o Growth; 8.2% per year o Share in engineering occupations; 53.7% 33. Auxiliary Finance and Investment Services o Employment of qualified engineers; 1,685 o Growth; 2.5% per year o Share in engineering occupations; 41.2% 34. Other Transport Support Services o Employment of qualified engineers; 1,671 o Growth; 20.8% per year o Share in engineering occupations; 67.1% 35. Rail Passenger Transport o Employment of qualified engineers; 1,662 o Growth; 8.8% per year o Share in engineering occupations; 66.8% 36. Building Cleaning and Related Services o Employment of qualified engineers; 1,550 o Growth; 7.9% per year o Share in engineering occupations; 5.1% Engineers Australia 71

86 37. Supermarkets and Grocery Stores o Employment of qualified engineers; 1,508 o Growth; 7.4% per year o Share in engineering occupations; 9.6% 38. Other Mining Support Services o Employment of qualified engineers; 1,476 o Growth; 15.6% per year o Share in engineering occupations; 79.9% 39. School Education o Employment of qualified engineers; 1,474 o Growth; 3.8% per year o Share in engineering occupations; 3.8% 40. Non-Metallic Mineral Product Manufacturing o Employment of qualified engineers; 1,473 o Growth; 3.5% per year o Share in engineering occupations; 63.2% 41. Polymer Product & Rubber Product Manufacturing o Employment of qualified engineers; 1,468 o Growth; -2.3% per year o Share in engineering occupations; 50.7% 42. Road Passenger Transport o Employment of qualified engineers; 1,457 o Growth; 9.9% per year o Share in engineering occupations; 6.7% 43. Electricity Generation o Employment of qualified engineers; 1,454 o Growth; 6.5% per year o Share in engineering occupations; 74.1% 44. Hospitals o Employment of qualified engineers; 1,397 o Growth; 6.2% per year o Share in engineering occupations; 35.0% 45. Electrical and Electronic Goods Retailing o Employment of qualified engineers; 1,346 o Growth; 1.8% per year o Share in engineering occupations; 34.3% 46. Road Freight Transport o Employment of qualified engineers; 1,265 o Growth; 4.0% per year o Share in engineering occupations; 29.4% 47. Other Administrative Services o Employment of qualified engineers; 1,236 o Growth; 5.7% per year o Share in engineering occupations; 56.1% 48. Employment Services o Employment of qualified engineers; 1,225 o Growth; 3.1% per year o Share in engineering occupations; 42.6% 49. Airport Operations and Other Air Transport Support o Employment of qualified engineers; 1,166 o Growth; 4.5% per year o Share in engineering occupations; 77.0% 50. Legal and Accounting Services o Employment of qualified engineers; 1,123 o Growth; 4.3% per year Engineers Australia 72

87 o Share in engineering occupations; 31.9% 51. Adult, Community and Other Education o Employment of qualified engineers; 1,068 o Growth; 3.8% per year o Share in engineering occupations; 43.4% 52. Construction not further defined o Employment of qualified engineers; 1,052 o Growth; 3.4% per year o Share in engineering occupations; 82.0% Including engineers who did not state the industry in which they were employed or who inadequately described it, 48,013, or 18.9% of qualified engineers, were employed in 185 industries that employed fewer than 1,000 qualified engineers in It is fairly clear that some industries, for example, industry 37 supermarkets and grocery stores cannot be seen as important sources of engineering employment given that just 9.6% of employment is in engineering occupations. But employment growth in this industry was 9.6% per year. Why so many engineers prefer employment in such industries is unknown but this employment is a vital leakage from the profession and an indicator of frustration on the part of some engineers. Engineers Australia 73

88 Chapter 9 Geographic Location Main Points This Chapter looks at the geographic distribution of the engineering labour force within States and Territories. The engineering labour force is concentrated within major urban areas in each jurisdiction. The statistics relate to sub-state regions and show a wide range in size of engineering populations. There are also substantial differences in unemployment rates within each jurisdiction. 9.1 The ABS Approach to Geographic Statistics This Chapter presents statistics on the engineering labour force for geographic locations within States and Territories. The statistics follow the ABS Australian Geography Standard (ASGS) which was first introduced in July This classification system was a fundamental change from earlier geographic classifications used by the ABS. For this reason only statistics from the 2011 census are provided to avoid the complexities associated with mapping earlier statistics into the ASGS formats. The ASGS is a hierarchical system whose smallest geographic region is the mesh block. Mesh blocks reflect land use boundaries and wherever possible contain or aggregate to whole suburbs or rural locations. There are 347,000 mesh blocks covering Australia with no gaps or overlaps. Mesh blocks aggregate to Statistical Areas level 1(SLA1). In turn SLA1s aggregate to Statistical Areas level 2 (SLA2) and these aggregate to Statistical Areas level 3 (SLA3). The statistics in this Chapter are classified according to the next level of aggregation, Statistical Areas level 4 are aggregations of SLA3s and are the largest formal sub-state region in the classification. SLA4s reflect labour markets and are the best sub-state socio-economic breakdown in the ASGS. SLA4s have a minimum population of 100,000 but have much larger populations in metropolitan areas. There are 106 SLA4s covering Australia, including several that cover people in transit at the time of the census. The ABS has outlined the structure of the ASGS in considerable detail and this is available from its web site 23. This publication also contains maps of the SLA structure for each State and Territory should readers require this information. 9.2 New South Wales Table 9.1 sets out statistics on the engineering labour market in 30 SLA4s in New South Wales; 14 SLA4s cover the Sydney metropolitan areas, 14 the balance of the State and there are 2 transitory categories. The statistics provided cover employment, unemployment, the labour force, unemployment rates and the proportion of employment in engineering occupations. Each of these is provided for men, women and the two genders combined. Finally, the share of women in the engineering labour force is given for each region. Table 9.1 covers an engineering labour force of 86,490; 83,119 were employed and 3,319 were unemployed giving an unemployment rate of 3.9% for the State. The proportion of the State s engineering labour force employed in engineering occupations was 58.3% and women accounted for 12.4% of the State s engineers. Features of the regional distribution include: 23 See ABS, Australian Statistical Geography Standard, Cat No , 23 December 2010, Engineers Australia 74

89 The largest regional engineering labour force was in Sydney-Inner west which had 7,726 engineers. The unemployment rate was above the State average at 5.4% and the proportion employed in engineering occupations was comparatively low at 48.1%. Women accounted for 13.7% of the labour force. The smallest regional labour force was in Far West and Orana which had 353 engineers. The unemployment rate was well below the State average, just 2.8% and the proportion employed in engineering occupations was slightly higher than the State average at 59.2%. Women accounted for 12.5% of the region s engineering labour force. The highest unemployment rate occurred in Sydney-Eastern Suburbs region with 5.5% and the lowest was in the Hunter Valley excluding Newcastle region with just 1.5%. The highest proportion of the engineering labour force employed in engineering occupations was 71.1%, considerably higher than the State average in the Hunter Valley excluding Newcastle region and the lowest proportion was in Sydney South West with just 45.1% employed in engineering occupations. 9.3 Victoria Victorian regional statistics are set out in Table 9.2. This Table covers 8 metropolitan regions, 9 nonmetropolitan regions and two transitory categories. In 2011, the Victorian engineering labour force comprised 72,768; 69,872 were employed and 2,896 were unemployed giving an unemployment rate of 4.0%. The proportion of the labour force employed in engineering occupations was 58.3% and women accounted for 12.9% of the labour force. Other features include: The largest regional engineering labour force was in Melbourne-Inner with 11,079 engineers. The unemployment rate was above the State average with 4.3%. The proportion of the labour force employed in engineering occupations was also above the State average at 65.4% as was the women s share of the labour force with 16.8%. The smallest engineering labour force was in the North West region with 382 engineers. The unemployment rate, 2.6%, was below the State average but so too was the proportion employed in engineering occupations which was 52.4% and the share of women in the engineering labour force, 10.2%. The highest unemployment rate, 5.0%, was in Melbourne West region and the lowest, 1.8%, was in Shepparton. The highest proportion of the labour force employed in engineering occupations was in Bendigo region with 67.5% and the lowest was 50.6% in Melbourne West region. 9.4 Queensland Table 9.3 provides statistics for 21 regions in Queensland; 5 cover metropolitan Brisbane, 14 are other Queensland cities and country areas and 2 are transitory categories. The statistics cover a State engineering labour force of 44,810; 43,447 were employed and 1,363 were unemployed. The State unemployment rate was 3.0% and 68.3% of the engineering labour force was employed in engineering occupations. Women accounted for 10.5% of the labour force. Features include: The largest engineering labour force was 6,397 in Brisbane Inner City region. Here the unemployment rate was 2.7%, 76.8% of the engineering labour force was employed in engineering occupations and 14.2% of the labour force were women. The smallest engineering labour force was 518 in the Darling Downs-Maranoa region. The unemployment rate was 1.4%, 58.1% of the labour force was employed in engineering occupations and women accounted for 7.7% of the labour force. The highest unemployment rate was 4.6% in the Gold Coast region and the lowest was 0.5% in Queensland Outback region. The highest proportion of the labour force employed in engineering occupations was 76.8% in Brisbane Inner City region and the lowest was 56.4% in Logan-Beaudesert region. Engineers Australia 75

90 9.5 South Australia Table 9.4 gives statistics for 9 regions in South Australia; 4 cover Adelaide, 3 areas of the State outside of Adelaide and there are 2 transitional categories. The Table covers an engineering labour force of 15,000; 12,997 employed and 1,423 unemployed. The State s unemployment rate was 3.9% and 63.8% of the engineering labour force was employed in engineering occupations. Women accounted for 10.3% of the labour force. Other features include: The largest regional labour market was Adelaide Central and Hills with 4,557 engineers. The unemployment rate was 4.1% and 68.2% of the labour force was employed in engineering occupations. Women accounted for 11.0% of the labour force. The smallest region was Barossa-Yorke-Mid North which had 307 engineers. The unemployment rate was 1.6% but just 54.4% of the labour force was employed in engineering occupations. Women accounted for 11.1% of the labour force. The highest unemployment rate occurred in Adelaide West region with 4.6% and the lowest was 1.2% in South Australia Outback. The highest proportion of the labour force employed in engineering occupations was 76.9% in South Australia Outback and the lowest was 54.4% in Barossa-Yorke-Mid North region. 9.6 Western Australia Table 9.5 covers the 11 regions in Western Australia; 5 cover metropolitan Perth, 4 cover other areas of the State and there were 2 transitory categories. The Table covers a labour force of 35,003 engineers; 34,125 employed and 878 unemployed. The State s unemployment rate was very low at 2.5% and 69.6% of the labour force was employed in engineering occupations, the highest of any jurisdiction. Women accounted for 10.3% of the labour force. Other features include: The largest region was Perth-South East with 8,030 engineers. The unemployment rate was 3.4% and 67.3% were employed in engineering occupations. Women accounted for 11.2% of the labour force. The smallest region was Western Australia-Wheat Belt with 496 engineers. Unemployment was low at 2.4% but just 47.4% were employed in engineering occupations. There were 9.7% women in the labour force. The highest unemployment rate occurred in Mandurah region with 4.1% and the lowest was in Western Australia-Outback region with 1.0%. The highest proportion of the labour force employed in engineering occupations was in Perth Inner region with 76.9% and the lowest was 47.4% in Western Australia-Wheat Belt. 9.7 Tasmania Table 9.6 covers 6 regions in Tasmania, 2 of which were transitory categories. Overall the engineering labour force was small with 2,946 engineers; 2,833 employed and 113 unemployed. The unemployment rate was 3.8% and 65.7% of the labour force was employed in engineering occupations. Women accounted for 8.4% of the labour force. Other Features include: The largest region was Hobart with 1,620 engineers. The unemployment rate was 4.0% and 67.6% of the labour force was employed in engineering occupations. Women accounted for 9.8% of the labour force. The smallest region was South East with 118 engineers. The region had an unemployment rate of 5.1% and 61.9% of the labour force was employed in the engineering occupations. Women accounted for 9.3% of the labour force. The highest unemployment rate was 5.1% in South East region and the lowest was 3.1% in Launceston and North East region. The highest proportion of the labour force employed in engineering occupations was 67.6% in Hobart and the lowest was 61.9% in South East region; this range was the lowest in any jurisdiction. Engineers Australia 76

91 9.8 The Territories Separate Table were not compiled for the Territories because the numbers involved were too small. Some particulars include: There were 4 regions in the Northern Territory, 2 of which were transitory. o Overall the Territory s engineering labour force numbered 1,876. The unemployment rate was 1.6% and 62.8% were employed in engineering occupations. Women accounted for 10.6% of the labour force. o Almost three-quarters of the labour force, 1,355, lived in Darwin and labour market o characteristics were almost identical to the Territory as a whole. There were 504 engineers in the second region, Northern Territory-Outback. Here unemployment was almost non-existent (0.8%) and other characteristics followed the Territory pattern. The Australian Capital Territory is effectively one region with an engineering labour force of 4,958. The unemployment rate was 2.9% and 65.1% of the labour force was employed in engineering occupation. Women accounted for 12.9% of the labour force. There were 35 engineers in total in other Australian Territories. Engineers Australia 77

92 Table 9.1: The Distribution of the Engineering Labour Force Throughout NSW, 2011 Employed Unemployed Labour Force Unemployment Rate Women's In Engineering Occ's (%) Region Men Women Total Men Women Total Men Women Total Men Women Total Share (%) Men Women Total Central Coast Sydney - Baulkham Hills and Hawkesbury Sydney - Blacktown Sydney - City and Inner South Sydney - Eastern Suburbs Sydney - Inner South West Sydney - Inner West Sydney - North Sydney and Hornsby Sydney - Northern Beaches Sydney - Outer South West Sydney - Outer West and Blue Mountains Sydney - Parramatta Sydney - Ryde Sydney - South West Sydney - Sutherland Capital Region Central West Coffs Harbour - Grafton Far West and Orana Hunter Valley exc Newcastle Illawarra Mid North Coast Murray New England and North West Newcastle and Lake Macquarie Richmond - Tweed Riverina Southern Highlands and Shoalhaven No Usual Address (NSW) Migratory - Offshore - Shipping (NSW) NSW TOTAL Source: ABS, 2011 Population Census, Estimated using TableBuilder Pro Engineers Australia 78

93 Table 9.2: The Distribution of the Engineering Labour Force Throughout Victoria, 2011 Employed Unemployed Labour Force Unemployment Rate Women's In Engineering Occ's (%) Region Men Women Total Men Women Total Men Women Total Men Women Total Share (%) Men Women Total Melbourne - Inner Melbourne - Inner East Melbourne - Inner South Melbourne - North East Melbourne - North West Melbourne - Outer East Melbourne - South East Melbourne - West Mornington Peninsula Ballarat Bendigo Geelong Hume Latrobe - Gippsland North West Shepparton Warrnambool and South West No Usual Address (Vic.) Migratory - Offshore - Shipping (Vic.) TOTAL VICTORIA Source: ABS, 2011 Population Census, Estimated using TableBuilder Pro Engineers Australia 79

94 Table 9.3: The Distribution of the Engineering Labour Force Throughout Queensland, 2011 Employed Unemployed Labour Force Unemployment Rate Women's In Engineering Occ's (%) Region Men Women Total Men Women Total Men Women Total Men Women Total Share (%) Men Women Total Brisbane - East Brisbane - North Brisbane - South Brisbane - West Brisbane Inner City Ipswich Logan - Beaudesert Moreton Bay - North Moreton Bay - South Cairns Darling Downs - Maranoa Fitzroy Gold Coast Mackay Queensland - Outback Sunshine Coast Toowoomba Townsville Wide Bay No Usual Address (Qld) Migratory - Offshore - Shipping (Qld) TOTAL QUEENSLAND Source: ABS, 2011 Population Census, Estimated using TableBuilder Pro Engineers Australia 80

95 Table 9.4: The Distribution of the Engineering Labour Force Throughout South Australia, 2011 Employed Unemployed Labour Force Unemployment Rate Women's In Engineering Occ's (%) Region Men Women Total Men Women Total Men Women Total Men Women Total Share (%) Men Women Total Adelaide - Central and Hills Adelaide - North Adelaide - South Adelaide - West Barossa - Yorke - Mid North South Australia - Outback South Australia - South East No Usual Address (SA) Migratory - Offshore - Shipping (SA) TOTAL SA Source: ABS, 2011 Population Census, Estimated using TableBuilder Pro Table 9.5: The Distribution of the Engineering Labour Force Throughout Western Australia, 2011 Employed Unemployed Labour Force Unemployment Rate Women's In Engineering Occ's (%) Region Men Women Total Men Women Total Men Women Total Men Women Total Share (%) Men Women Total Mandurah Perth - Inner Perth - North East Perth - North West Perth - South East Perth - South West Bunbury Western Australia - Outback Western Australia - Wheat Belt No Usual Address (WA) Migratory - Offshore - Shipping (WA) TOTAL WA Source: ABS, 2011 Population Census, Estimated using TableBuilder Pro Engineers Australia 81

96 Table 9.6: The Distribution of the Engineering Labour Force Throughout Tasmania, 2011 Employed Unemployed Labour Force Unemployment Rate Women's In Engineering Occ's (%) Region Men Women Total Men Women Total Men Women Total Men Women Total Share (%) Men Women Total Hobart Launceston and North East South East West and North West No Usual Address (Tas.) Migratory - Offshore - Shipping (Tas.) TOTAL TASMANIA Source: ABS, 2011 Population Census, Estimated using TableBuilder Pro Engineers Australia 82

97 Chapter 10 Engineering Specialisations Main Points Specialisation in engineering begins with the stream of engineering studied in the requisite entry level qualification. Most specialisation occurs on-the-job in the three to four years after graduation. Statistics on the numbers of engineers in different specialist areas are not available. This Chapter provides statistics on numbers in streams of engineering education as a stop-gap measure. Statistics are provided for 10 broad streams of engineering and 56 detailed streams for the engineering labour force, unemployment and the proportion of the labour force employed in engineering occupations. In all cases the statistics are provided by gender. The degree of fragmentation of the engineering labour force into unique specialist streams is very high; 22 of the 56 detailed streams listed have 1,000 or more engineers and 26 have more than 500. The number of engineers in streams with less than 500 is 4,274 and in many instances includes substantial numbers employed in engineering occupations. Aggregation dilutes the comparatively high proportion employed in engineering occupations in several broad streams of engineering In many instances the proportion of the labour force employed in engineering occupations was consistently high across detailed streams, for example in civil engineering. In other instances, including well known ones, the proportion employed in engineering occupations was below the national average in all detailed streams, for example in mechanical and industrial engineering. With few exceptions, the proportion of women employed in engineering occupations in both broad and detailed streams is substantially less than men. The role this plays in retarding the development of more women engineers warrants further investigation. Although aggregate unemployment among engineers has been low, there are numerous pockets of high unemployment in specific detailed streams of engineering Engineering Courses and Engineering Specialisation The purpose of this Chapter is to provide an overview of engineering specialisation and some of the important issues involved. In engineering specialisation in a specific area of engineering practice is common and this is widely understood in the community. However, how engineers become specialists in their chosen field is not well understood. Specialisation begins with the choice of university or TAFE education pathway or stream. Degree or advanced diploma programs are differentiated according to the main field of engineering addressed by courses. Thus, for example, there are programs in mechanical, civil or electrical engineering, sometimes even finer delineation such as distinguishing between civil and construction engineering are offered. The characteristic of formal programs are they are systematic, planned, organised and have formal evaluation mechanisms for achievement in the setting of educational institutions. All education statistics included in the Statistical Overview are classified according to the ABS Australian Standard Classification of Education (ASCED). ASCED was developed as a framework for collecting statistics relating to formal educational activities like the ones discussed above. The system is structured according to the field of education pursued and the level of educational activity undertaken. To the extent that universities and TAFE colleges stream engineering courses into different pathways, ASCED provides a consistent basis for measuring attendance and completion of courses in these different streams. ASCED is a hierarchical structure which provides greater or less detail depending on the level Engineers Australia 83

98 of aggregation. Broad level statistics (four digit level of aggregation) are reported in section 10.2 and more detailed statistics (six digit level) are reported in section Specialisation, as it is understood in engineering, utilises the completion of formal engineering courses as the foundation for an on-the-job process of competency acquisition. Completion of accredited engineering courses enables graduates to demonstrate Stage 1 competencies. Specialisation in a specific area of engineering practice occurs through demonstrating achievement of stage 2 competencies. Demonstrating professional competence is common to the professions, but engineering differs in the methodology used. Other professions typically undertake a formal period of training after the completion of under-graduate qualifications. Engineering is unique in that the process of professional formation is achieved through an on-the-job process. Structured training is not formally part of this process unless it is offered by individual employers as part of corporate staff developmen strategies. A key reason for this approach is the sheer diversity of the engineering profession; besides eight main disciplines, represented by Engineers Australia s Colleges, there are numerous specialisations in each discipline, represented by over 35 Technical Societies affiliated with Engineers Australia. This diversity means an on-the-job process is more practical. The period of professional formation conclude when individual engineers demonstrate achievement of sixteen Stage 2 competencies. These competencies are consistent with international benchmarks for engineers and recognise that engineers have achieved the capacity to practice engineering independently in their preferred field and their capacity to make independent engineering decisions. Thus completion of professional formation signals completion of the development of engineering specialisation.engineering specialisation is a life-time process of learning and practical experience. Following completion of Stage 2 competencies, engineers are expected to maintain the currency of knowledge in their field through continuous professional development. Table 10.1: The Engineering Labour Force, Broad Streams of Engineering Education, 2006 and Labour Market Measure Labour Force Unemployment Rate (%) Employed in Engineering Employed in Engineering (%) Engineering Stream Men Women Total Men Women Total Men Women Total Men Women Total Engineering & Related Technologies nfd Manufacturing Engineering Process & Resource Engineering Automotive Engineering Mechanical & Industrial Engineering Civil Engineering Electrical & Electronic Engineering Aerospace Engineering Maritime Engineering Other Engineering & Related Technologies All Engineering Engineering & Related Technologies nfd Manufacturing Engineering Process & Resource Engineering Automotive Engineering Mechanical & Industrial Engineering Civil Engineering Electrical & Electronic Engineering Aerospace Engineering Maritime Engineering Other Engineering & Related Technologies All Engineering Source: ABS, Population Census, 2006 and 2011, Estimated Using TableBuilder Pro The statistics reported in following sections relate to specialisation in the formal education stage and do not reflect specialisation achieved through the process of professional formation. At best, they provide an indication of the directions that engineering specialisations are headed. It is likely that a graduate Civil Engineer will specialise in one of the associated areas of practice like construction, structures, geotechnical or ocean engineering. It is unlikely that a graduate Civil Engineer will specialise in an area of practice associated with the completion of a degree in Mechanical Engineering. Engineers Australia 84

99 Official statistics on the number of engineers in specialisations as understood by Engineers Australia are not available. Although Engineers Australia as an organisation is aware of the specialisations of its members, membership is voluntary and there is little point in publishing incomplete statistics. This gap in information is a serious deficiency because shortages of engineers are often shortages of specific specialist engineering skills. When these situations occur, the shotages in question cannot be met through substitution with other engineers or other technical fields and can mean the difference between competent project delivery or not and between technical innovation and productive advance and recreating the past Broad Specialist Areas of Engineering Characteristics of the engineering labour force for broad engineering specialisations are set out in Table The Table includes statistics on the size of the labour force, unemployment rates and the number and proportions employed in engineering occupations. In 2011, 117,921 or 44.6% of the engineering labour force identified themselves as having qualifications in Engineering and Related Technology not further defined. This group had grown by 28.4% since 2006, less than national growth of 31.5% for all engineers. The 2011 unemployment rate for the group was 3.1% and was below the national rate of 3.6%. The proportion employed in engineering occupations in 2011, 66.1%, was the second highest of all education streams. The largest of the more familiar engineering streams was Electrical and Electronic Engineering which had a labour force of 50,868 in 2011, having grown by 32.7% since 2006, slightly more than the national benchmark for all engineers. Unemployment was above the national rate with 4.2% and the proportion employed in engineering occupations, 55.2%, was less than the national benchmark. The highest growth between 2006 and 2011 occurred among Mechanical and Industrial engineers whose labour force expanded by 44.9% compared to 31.5% for all engineers. In 2011, this group numbered 22,169 which was 8.4% of the engineering labour force. The 2011 unemployment rate was higher than the national figure and the proportion employed in engineering occupations, 56.0%, was below the national benchmark. The proportion of women Mechanical and Industrial Engineers was 7.5%. The highest proportion employed in engineering occupations was among Civil Engineers with 74.8% in This group experienced well above average growth between 2006 and 2011 both in labour force numbers and numbers employed in engineering occupations. Unemployment in 2011 was equal to the national benchmark and the proportion of women was a little above the national figure with 11.7%. In 2011, women accounted for 11.8% of the engineering labour force. Three streams had much higher proportions and the other eight groups had proportions below the national figure. The highest proportion of women occurred in Manufacturing Engineering where it was 32.5% in This group numbered 5,255 in 2011 but just 33.7% were employed in engineering occupations. Despite this low proportions, the latter experienced strong growth between census years. Unemployment was well above the national figure for 2011 with 5.0%. The second highest proportion of women occurred in Other Engineering and Technology, a group which includes Biomedical and Environmental Engineering. In 2011, the proportion of women was 25.2%. This group had above average growth between census years and the 2011 unemployment rate of 4.6% was well above the national benchmark. Unlike Manufacturing Engineering, the proportion employed in engineering occupations was relatively high but at 53.9% was below the national benchmark. The third group in which the proportion of women was above average was Process and Resource Engineering with 21.9% in Growth in this group was below the national average but the proportion employed in engineering occupations, 58.6% in 2011 was fairly close to the national benchmark while unemployment was about average. Engineers Australia 85

100 10.3 Detailed Engineering Streams Tables 10.2 and 10.3 disaggregate the broad statistics in Table 10.1 into 56 detailed streams of engineering as set out in the ASCED structure. The information in these Tables helps to understand why engineering is relatively slow to respond to rapid and large increases in demand. Typically, change relates to specific streams of engineering and the Tables show that in many cases the number of engineers in some streams is quite small and that change between censuses has not been large. Some features of the Tables include: The degree of fragmentation of the engineering labour force into unique specialist streams is very high; 22 of the 56 detailed streams listed have 1,000 or more engineers and 26 have more than 500. The number of engineers in streams with less than 500 is 4,274 and in many instances includes substantial numbers employed in engineering occupations. Aggregation dilutes the comparatively high proportion employed in engineering occupations in several broad streams of engineering; in 2011, o The proportion in broad manufacturing was 33.7% but the detailed manufacturing engineering stream had 56.9% in engineering occupations. o The proportion in broad process and resource engineering was 58.6% but the detailed o stream mining engineering had 72.6%. The proportion in the broad other engineering and technology was 53.9% but within it the detailed stream environmental engineering had 66.7% employed in engineering occupations. In many instances the proportion of the labour force employed in engineering occupations was consistently high across detailed streams, for example in civil engineering. In other instances, including well known ones, the proportion employed in engineering occupations was below the national average in all detailed streams, for example in mechanical and industrial engineering. With few exceptions, the proportion of women employed in engineering occupations in both broad and detailed streams is substantially less than men. The role this plays in retarding the development of more women engineers warrants further investigation. In 2006 and in 2011, aggregate unemployment of engineers was low; 3.0% and 3.6%, respectively. This period included one of the most acute shortages of engineers experienced in Australia. Against this background the Tables show that numerous pockets of much higher unemployment occurred, for example in 2011 the unemployment rate for industrial engineers was 6.5%, 6.0% for water and sanitary engineers, 5.4% for communications technologists and 6.2% for biomedical engineers. This Chapter demonstrates that as well as geographic location and industry of employment, engineering specialist streams are an important source of diversity in the engineering profession. When these three elements are accompanied by employer requirements for certain types and extent of experience it becomes easier to understand why periodic shortages of engineers can occur, particularly in smaller specialist streams. Engineers Australia 86

101 Table 10.2: The Engineering Labour Force, Detailed Streams of Engineering Education, 2006 Labour Market Measure Labour Force Unemployment Rate (%) Employed in Engineering Employed in Engineering (%) Engineering Stream Men Women Total Men Women Total Men Women Total Men Women Total Total Engineering & Related Technologies nfd Manufacturing Engineering, nfd Manufacturing Engineering Printing Textile Making Garment Making Cabinet Making Manufacturing Engineering, nec Total Manufacturing Engineering Process and Resources Engineering, nfd Chemical Engineering Mining Engineering Materials Engineering Food Processing Technology Process and Resources Engineering, nec Total Processing & Resource Engineering Automotive Engineering, nfd Automotive Engineering Total Automotive Engineering Mechanical and Industrial Engineering, nfd Mechanical Engineering Industrial Engineering Metal Fitting, Turning and Machining Metal Casting and Patternmaking Precision Metalworking Plant and Machine Operations Mechanical and Industrial Engineering, nec Total Mechanical & Industrial Engineering Civil Engineering, nfd Construction Engineering Structural Engineering Building Services Engineering Water and Sanitary Engineering Transport Engineering Geotechnical Engineering Ocean Engineering Civil Engineering, nec Total Civil Engineering Electrical and Electronic Engineering, nfd Electrical Engineering Electronic Engineering Computer Engineering Communications Technologies Communications Equipment Installation and Maintenance Electrical Fitting, Electrical Mechanics Refrigeration and Air Conditioning Mechanics Electrical and Electronic Engineering, nec Total Electrical & Electronic Engineering Aerospace Engineering, nfd Aerospace Engineering Aircraft Maintenance Engineering Aircraft Operation Air Traffic Control Total Aerospace Engineering Maritime Engineering, nfd Maritime Engineering Marine Construction Marine Craft Operation Maritime Engineering, nec Total Maritime Engineering Environmental Engineering Biomedical Engineering Fire Technology Engineering and Related Technologies, nec Total Other Engineering & Related Technologies Total All Engineering and Technology Source: ABS, 2006 and 2011 Population Census, Compiled using TableBuilder Pro Engineers Australia 87

102 Table 10.3: The Engineering Labour Force, Detailed Streams of Engineering Education, 2011 Labour Market Measure Labour Force Unemployment Rate (%) Employed in Engineering Employed in Engineering (%) Engineering Stream Men Women Total Men Women Total Men Women Total Men Women Total Total Engineering & Related Technologies nfd Manufacturing Engineering, nfd Manufacturing Engineering Printing Textile Making Garment Making Cabinet Making Manufacturing Engineering, nec Total Manufacturing Engineering Process and Resources Engineering, nfd Chemical Engineering Mining Engineering Materials Engineering Food Processing Technology Process and Resources Engineering, nec Total Processing & Resource Engineering Automotive Engineering, nfd Automotive Engineering Total Automotive Engineering Mechanical and Industrial Engineering, nfd Mechanical Engineering Industrial Engineering Metal Fitting, Turning and Machining Metal Casting and Patternmaking Precision Metalworking Plant and Machine Operations Mechanical and Industrial Engineering, nec Total Mechanical & Industrial Engineering Civil Engineering, nfd Construction Engineering Structural Engineering Building Services Engineering Water and Sanitary Engineering Transport Engineering Geotechnical Engineering Ocean Engineering Civil Engineering, nec Total Civil Engineering Electrical and Electronic Engineering, nfd Electrical Engineering Electronic Engineering Computer Engineering Communications Technologies Communications Equipment Installation and Maintenance Electrical Fitting, Electrical Mechanics Refrigeration and Air Conditioning Mechanics Electrical and Electronic Engineering, nec Total Electrical & Electronic Engineering Aerospace Engineering, nfd Aerospace Engineering Aircraft Maintenance Engineering Aircraft Operation Air Traffic Control Total Aerospace Engineering Maritime Engineering, nfd Maritime Engineering Marine Construction Marine Craft Operation Maritime Engineering, nec Total Maritime Engineering Environmental Engineering Biomedical Engineering Fire Technology Rail Operations Total Other Engineering & Related Technologies Total All Engineering and Technology Source: ABS, 2006 and 2011 Population Census, Compiled using TableBuilder Pro Engineers Australia 88

103 Chapter 11 Average Ages and Age Structure Main Points The average age of qualified engineers in the Australian engineering labour force barely increased between 2006, changing from 41.7 years to 41.9 years. This conclusion also applies to engineers employed in engineering occupations for whom the change was from 41.0 years to 41.1 years. In 2006, women qualified engineers were on average 5.8 years younger than men and the difference was slightly less, 5.3 years, in The gender differentials were 7.7 years and 6.6 years, respectively for engineers employed in engineering occupations. Engineers were on average about two years older than the Australian skilled labour force. The comparative stability in the average age of engineers was the result of opposing changes at the extremities of the age range, mainly among men. Growth in several of the youngest age groups was faster than for the labour force as a whole and this also occurred for several of the oldest age groups while age groups in the middle of the range grew slower than the labour force. This pattern was observed for both Australian and overseas born engineers. There is a risk associated with the concentration of engineers in older age groups because retirement from the labour force is much nearer. About 17.5% of engineers were aged 55 years or more in These age groups exhibit the fastest rate of contraction as engineers retire. This process is likely already underway three years later and could accelerate in the soft economic conditions now prevailing in the engineering labour market. There is virtually no difference in labour force participation of men in the engineering labour force and in other fields with similar qualifications. However, there is a pronounced difference between women engineers and women in other fields. At all age groups the participation of women was well below the participation in other fields and this is a factor likely to impact on the participation of women in engineering Average Age of Engineers Average ages were estimated using census statistics as the weighted average of single age years from 15 to 100 years weighted by the proportion of qualified engineers in the labour force at each age. Table 11.1 shows estimates of the average ages for the engineering labour force, for the segment of the engineering labour force employed in engineering occupations and for the skilled labour force. Here the skilled labour force is defined as in Chapter 8 as the labour force of people who have at least an Advanced Diploma or an Associate Degree in any recognised field. In 2006, the average age of the skilled labour force was 40.7 years; men were older than women, 41.8 years compared to 39.8 years. The average age of the engineering labour force was older, mainly because male engineers were older. The average age of the engineering labour force was 41.7 years with the average age of men 42.3 years and women on average 5.8 years younger at 36.5 years. The Table shows, however, that retention in engineering occupation leads to a reduction in the average age of engineers much closer to that for the skilled labour force. The average age of men in engineering occupations falls to 41.8 years and the average age of women in these occupations falls to 34.0 years. By 2011, small changes towards higher ages had occurred for all groups. The skilled labour force increased average age from 40.7 years to 41.1 years, and both genders had similar experiences. The increase in average age for the engineering labour force was much less, increasing from 41.7 years to 41.9 years and there was barely any increase in the segment employed in engineering occupations. As Engineers Australia 89

104 was the case in the skilled labour force, the average age increased for both genders in the two engineering groups. Table 11.1: The Average Age of the Engineering Labour Force (years) Census Labour Force Employed in Engineering Skilled Year Men Women Total Men Women Total Men Women Total Source: Estimated from ABS, 2006 and 2011 Population Census using TableBuilder Pro How these changes came about in the engineering groups is explored in the following section Age Structure and how it has changed Chapter 3 demonstrated the importance of overseas born engineers in the structural composition of the engineering labour force and Chapter 7 highlighted the rapid increase in skilled migration that has occurred, including the period covered by the two census years discussed throughout the Statistical Overview. For these reasons, the distinction between overseas and Australian born qualified engineers is the basis for discussion in this section. Table 11.2 shows the age structure of the engineering labour force in 2006 and in 2011 by gender and by country of origin. In essence, this Table expands the labour force row in Table 3.1 by age groups 24. Table 11.2: The Age Structure of the Engineering Labour Force, 2006 and Age Overseas Born Australian Born Total Group Men Women Total Men Women Total Men Women Total Under 20 years years years years years years years years years years years Years & over Total Under 20 years years years years years years years years years years years Years & over Total Source: Estimated from ABS, 2006 and 2011 Population Census using TableBuilder Pro 24 The slight difference between the two Tables is the product of the ABS arrangements to preserve confidentiality. Engineers Australia 90

105 Consideration of Table 11.2 is assisted by Figure In Figure 11.1, the age structure of the engineering labour force in 2011 is segmented into the base structure that existed in 2006 and the components of change that have occurred since then. The 2011 labour force is the 2006 labour force plus the changes that occurred between 2006 and For the labour force as a whole, the base components and the changes that occurred are as follows: Base labour force in 2006 o Australian born men; 35.97% o Australian born women; 3.22% o Overseas born men; 32.03% o Overseas born women; 4.80% Changes from 2006 to 2011 o Australian born men added 6.04% o Australian born women added 0.82% o Overseas born men added 14.18% o Overseas born women added 2.94% This structure is replicated for each age group in Figure Thus, the dark blue bars are the Australian born men in 2006 and the light blue bars are the increases in Australian born men between 2006 and 2011 for each age group. A similar approach is used for overseas born men (green bars), Australian born women (red shades) and overseas born women (purple shades). Figure 11.1: The Age Structure of the Engineering Labour Force in 2011 and How it has changed since 2006 AUS Men 2006 AUS Men Change to 2011 OS Men 2006 OS Men Change to 2011 AUS Women 2006 AUS Women Change to 2011 OS Women 2006 OS Women Change to Years & over years years years Age Groups years years years years years years years Under 20 years % in Age Groups Consider for example the largest age group, the 35 to 39 years group. In 2011, this age group accounted for 14.34% of the engineering labour force; 10.04%, or 70.0%, was in place in 2006 and change between 2006 and 2011 added 4.30%, that is, the remaining 30.0%. Similar breakdowns are shown for each age group. There were several other age groups that showed large component changes. In contrast, some age groups there was little, or no, change in some components between 2006 and For example; In the 30 to 34 years age group, the change for Australian born men was -0.01% and for Australian born women it was 0.08%. There was no change in Australian born women in the 25 to 29 years age group. Australian born men in the 50 to 54 years age group contracted by 0.03%. By comparing the changes in age group components to the overall change for the group examined, the changes in average ages set out in Table 11.1 can be better understood. The average age of men Engineers Australia 91

106 engineers increased marginally from 41.7 to 41.9 years. This was the result of countervailing changes at different end of the age range. The number of Australian born men increased by 16.80%; three young age groups, 25 to 29 years, 35 to 39 years and 40 to 45 years grew faster than this. Similarly, three older age groups, 55 to 59 years, 60 to 64 years and 65 to 69 years age groups also had above average growth. However, the middle age groups, 45 to 49 years and 50 to 54 years, had below average growth. There was a similar pattern for overseas born men. Immigration rules favour young skilled migrants and it was no surprise that there was above average growth in the 25 to 29 years, 30 to 34 years and 35 to 39 years age group. There was also above average growth in the 60 to 64 years, 65 to 69 years and 70 years and over groups. But there was below average growth in the middle age groups; 40 to 44 years, 45 to 49 years, 50 to 54 years and 55 to 59 years. The average age of women engineers increased from 36.5 to 37.2 years. In the case of Australian born women, all age groups from 35 to 39 years to 60 to 64 years experienced above average growth while age groups younger than 30 years experienced below average growth. Overseas born women showed a pattern similar to men with above average growth in older age groups offsetting above average growth in younger age groups while middle ones experienced below average growth. This combination suggests that the average age of women did not experience as large an increase because of the influence of these changes for overseas born women. 70 years & over Figure 11.2: The Age Structure of Engineers in Engineering Occupations in 2011 and how it has changed since 2006 AUS Men 2006 AUS Men Change to 2011 OS Men 2006 OS Men Change to 2011 AUS Women 2006 AUS Women Change to 2011 OS Women 2006 OS Women Change to years years years Age Groups years years years years years years years Under 20 years % in Age Groups Figure 11.2 reproduces Figure 11.1 to examine the changes that have occurred for engineers employed in engineering occupations. The same approach is used in this illustration. The average age of engineers employed in engineering occupations barely changed between 2006 and In the case of men the offsetting changes observed in Figure 9.1 were repeated for both Australian born and overseas born men. In the case of women, Australian born women experienced above average growth in age groups from 35 to 39 years to 60 to 64 years and below average growth in age groups younger than 35 years. In the case of overseas born women, the offsetting pattern observed for men was again evident. Table 11.1 appears to suggest some stability in the average age of engineers, whether employed in engineering occupations or more generally. However, when the components of change in individual age groups are examined, this stability is shown to be the combined effect of opposing changes at younger and older age groups. However, the passage of time could quickly erode this stability. In 2011, the first Engineers Australia 92

107 group, older men accounted for 19.1% of the engineering labour force. These men are moving closer to retirement decisions; decisions that could be influenced by adverse labour market conditions such as exist at present. By now in 2014 many may have already taken that decision. The proportion of women in these older age groups is much less, just 6.1% of women, and the impact of their retirement will not be as great. In aggregate 17.6% of the engineering labour force was in age groups 55 years and over and when they retire will have a profound influence on average age. The impact of retirement on engineers in engineering occupations could be almost as great; 17.4% of men and 3.5% of women in engineering occupations in 2011 were aged 55 years or more. This was 16.0% of the overall group employed in engineering occupations Age and Labour Force Participation During the 1980s and 1990s, there was a trend towards early retirement in Australia, but more recently, the global financial crisis and other financial considerations have been associated with working longer. Most of the available information on engineers has been anecdotal with little factual confirmation. This Section makes a start on remedying this gap in information by looking at the relationship between labour force participation for engineers and age and how it has changed between 2006 and Figure 11.3: Labour Force Participation of Engineers and Age Structure Men 2006 Men 2011 Women 2006 Women Participation Rate (%) Under 20 years years years years years years years Age Groups years years years years 70 Years & over Labour force participation rates were estimated for men and women engineers for each of the age groups shown in Table The standard definition of labour force participation was used; individuals participate in the labour force by being employed or by actively looking for work if they are unemployed. The participation rate is then the ratio of active labour force participants to the population. In early career years, labour force participation is often lower because of participation in education and a transition to full engagement with the labour market. As careers progress and individuals age, participation increases and may plateau and then approaching retirement years it begins to fall. This pattern is illustrated in Figure 11.3 which shows the relationship between participation rates and age groups for men and women in 2006 and For men, in 2011, labour force participation in the youngest age group was 65.6% and quickly built up to a plateau in the range 95 to 96% extending from about 30 years to 54 years. In the 50 to 54 years age group, participation falls to 88.2% with the first evidence of moves to retirement. Participation in later age groups falls quickly and in the oldest age group, 70 years and over, it is just 13.0%. Engineers Australia 93

108 The pattern is similar for women but the plateau in participation is lower, between 80 and 83%. There is also a dip in the plateau for women in their mid to late 30s and early 40s coinciding with the main period of family formation. The fall in participation in the 55 to 59 age group to 69.4% is larger than for men and the falls in participation rates in later age groups are also larger than for men. Just 4.9% of women aged 70 years and over remained in the engineering labour force, about one third the rate for men. The main change between 2006 and 2011 was higher participation among men and women from about age 50 years onwards. This was a period in part characterised by high demand for engineers but also including the trauma of the GFC when many retirement nest eggs may have been adversely affected by share market falls. The main change in 2011 was that participation in the older age groups increased as qualified engineers worked longer. The initial fall in participation in the 55 to 59 years age group still occurred, but was more moderate, falling to 88.2%. In all subsequent age groups participation was higher than in 2006 with the participation rate in the oldest group increasing to 13.0%. Women qualified engineers experienced a similar build up in participation in younger age groups as men, but the subsequent plateau was different to men in two respects. First, it was at a much lower level of participation, in the low 80s% and second there is a pronounced dip in participation for the 30 to 34 years, 35 to 39 years and 40 to 44 years age groups. Another difference to men is that the move to retirement starts earlier for women, in the 50 to 54 years age group, and the shift to retirement is faster than men with more rapid reduction in participation in subsequent age groups. Figure 11.4: The Age Profile of Labour Force Participation, Engineering Compared to All Skilled Areas, 2011 Engineering Men Comparison Men Engineering Women Engineering Comparison Participation Rate (%) Under 20 years years years years years years years years years years years 70 Years & over Figure 11.4 compares the labour force participation of engineers in 2011 to the participation of similarly qualified individuals in other skilled areas. This illustration shows that there is barely any distinction between the two groups of men. However, the difference between the two groups of women is pronounced. The structures of women s participation are similar, but the labour force participation of women engineers is lower in all age groups than for similarly qualified women in other skilled areas. This difference is likely to be a factor contributing to the low proportion of women in the engineering labour force. Engineers Australia 94

109 Chapter 12 Experience, Remuneration and Age Main Points This Chapter examines statistics sourced a well-known engineering salary survey to examine the average age of engineers, the level of experience of engineers and salary packages earned by them in a framework of responsibility levels. Changes in each of these factors are also explored. Public sector Professional Engineers are on older than their private sector counterparts at all responsibility levels. In both sectors, average ages have trended upwards in an uneven fashion until The opposite occurred for 2014 but this may be a statistical aberration. At every responsibility level, public sector Professional Engineers had longer periods of experience than private sector colleagues. Over time, work experience for engineer level 1 and 2 have fallen in both sectors, but from Grade 3 onwards, average work experience has increased. Growth in salary packages in both sectors has been consistent with prevailing engineering labour market conditions. In the period 2006 to 2009 when the demand for engineers was at its highest and acute skill shortages prevailed, salary movements for engineers at all levels in the private sector were about twice movements in full time adult earnings. There were some similarities in the public sector but on the whole salary movements here were lower. In the financial year ending 30 June 2014, salaries for engineers at all responsibility levels in the private sector fell, confirming the collapse in demand observed in vacancy statistics. There were similar changes in the public sector although some salary increases were recorded The Framework Employed Like most professions, engineering is differentiated by the economic sector that they work in and by the degree of experience they have. The main way in which economic sectors are differentiated is between the private and public sectors and this approach is used here. Often discussions of experience focus on job titles. There are serious limits to this because the same title can mean different things to different people. For this reason it is helpful to instead use an established framework based on engineering career related criteria. The framework of engineering responsibility levels has these characteristics. Engineering responsibility levels are defined by the degree of supervisory input, the degree of independent engineering decision making capacity expected of individuals and their capacity to undertake different roles in the engineering work force. Responsibility levels are embedded in salary arrangements and are often used to characterise engineering positions. There are six engineering responsibility levels defined as follows 25. Level 1 Professional Engineer; this is the graduate engineer entry level. The engineer undertakes engineering tasks of limited scope and complexity in offices, plants, in the field or in laboratories under the supervision of more senior engineers. 25 The definitions used by the Association of Professional Engineers, Scientists and Managers, Australia (APESMA) are used. APESMA has conducted surveys of engineering salaries since 1974 in June and December. Each edition, as well as the targeted salary information, contains statistics about the characteristics of survey respondents which provide important insights on the profession. The main limitation of the statistics is that they only cover Professional Engineers. Similar statistics for Engineering Technologists and Associate Engineers are not available. See APESMA, Professional Engineer Remuneration Survey Report, December 2012, pp8-9 for the source of the definitions. Engineers Australia 95

110 Level 2 Professional Engineer; this level recognizes the experience and competence gained as a Level 1 Engineer. At this level engineers have greater independence and less supervision, but guidance on unusual features is provided by engineers with more substantial experience. Level 3 Professional Engineer; this level requires the application of mature engineering knowledge with scope for individual accomplishment and problem solving that require modification of established guides. Original contributions to engineering approaches and techniques are common. This level outlines and assigns work, reviews it for technical accuracy and adequacy and may plan, direct, coordinate and supervise other professional and technical staff. Level 4 Professional Engineers; this level requires considerable independence in approach with a high degree of originality, ingenuity and judgment. Positions responsibilities often include independent decisions on engineering policies and procedures for overall programs, provision of technical advice to management, detailed technical responsibility for product development and the provision of specialized engineering systems and facilities and the coordination of work programs. Level 5 Professional Engineer; this level is usually responsible for an engineering administrative function, directing several professional and other groups engaged in inter-related engineering responsibilities or as an engineering consultant. This level independently conceives programs and problems to be investigated and participates in their resolution within existing organizational operating and management arrangements. Typical reporting line is to senior management. Above Level 5 Professional Engineer; this level is not separately defined by APESMA but is used for engineering senior management positions including, Managing Director, Chief Executive Officer and Group General Manager. The following sections utilise the responsibility framework to examine average length of experience at each level, average age and average salary packages for both the private and public sectors over the period from 2000 to the present. There are several distinct sub-periods over this interval including the resources boom, the pre-gfc boom in infrastructure, particularly in Australian cities, the shock of the GFC and the muted economic environment since. These factors have resulted in pronounced impacts on the demand for engineers which at times has been exceptionally high, leading to skill shortages, and more, the collapse in demand as boom conditions have come to an end. Both length of experience and salaries are subject to the influence of demand. High demand can lead to more rapid career progression and higher salaries are a means to attract scarce personnel. Low demand can slow career progression but can also mean lay-off so that the impact on length of experience is ambiguous, however, the impact of low demand on salaries is typically negative. These possibilities will be considered below. Age and aging of the Australian workforce has been topical in recent years. Census statistics discussed earlier provided some information about the age of engineers, but more information is needed for a thorough understanding. With this in mind, the engineering responsibility framework is used to examine age and its association with engineering careers and demand pressures. In past Editions of the Statistical Overview, statistics from the December APESMA survey were used for these comparisons. A change has been made for this and future Editions. Statistics from the June survey more appropriately compare to financial year statistics which are the more common form used in many Chapters. While there will be some minor changes to past statistics, broad conclusions are unlikely to change Length of Experience The average experience of Professional Engineers for the period 2000 to 2014 is shown in Table 12.1 for the private sector and in Table 12.2 for the public sector. Figure 12.1 looks at differences between the two sectors by comparing average length of experience over the full fifteen years. Engineers Australia 96

111 Table 12.1: Average Experience of Private Sector Professional Engineers Year Level 1 Level 2 Level 3 Level 4 Level 5 Above L Average 2000 to Average 2000 to Average 2005 to Average from Source: APESMA, Professional Engineer Remuneration Survey Reports, June Table 12.2: Average Experience of Public Sector Professional Engineers Year Level 1 Level 2 Level 3 Level 4 Level 5 Above L Average 2000 to Average 2000 to Average 2005 to Average from Source: APESMA, Professional Engineer Remuneration Survey Reports, June Public sector Professional Engineers have longer periods of professional practice at all stages of their careers than public sector engineers. The information provided shows that: Level 1 Professional Engineers in the public sector had an average 3.2 years of experience compared to 1.9 years in the private sector. Level 2 Professional Engineers in the public sector had an average 10.2 years of experience compared to 5.8 years in the private sector. Level 3 Professional Engineers in the public sector had an average 18.3 years of experience compared to 13.4 years in the private sector. Engineers Australia 97

112 Figure 12.1: Comparing Work Experience of Professional Engineers in the Private and Public Sectors 35.0 Private Sector Public Sector Average Work Experience During Last 5 Years Level 1 Level 2 Level 3 Level 4 Level 5 Above L5 Responsibility Level 35.0 Figure 12.2: Change in Average Experience Levels for Private Sector Professional Engineers 2000 to to Experience (Years) Level 1 Level 2 Level 3 Level 4 Level 5 Above L5 Responsibility Level 35.0 Figure 12.3: Change in Average Experience Levels for Public Sector Professional Engineers 2000 to to Experience (Years) Level 1 Level 2 Level 3 Level 4 Level 5 Above L5 Engineers Australia 98

113 Level 4 Professional Engineers in the public sector had an average 23.9 years of experience compared to 20.2 years in the private sector. Level 5 Professional Engineers in the public sector had an average 26.2 years of experience compared to 23.5 years in the private sector. Professional Engineers above level 5 in the public sector had an average 29.6 years of experience compared to 26.4 years in the private sector. The sectoral difference in average experience was least at level 1 where it was 1.3 years. It increased to a maximum of 4.9 years at level 3 and thereafter reduced to 2.7 years at level 5, widening again to 3.0 years for the most senior level. In both the private and public sectors there have been changes over time in the average experience levels of Professional Engineers at all levels. Figure 12.2 compares average length of experience between 2000 to 2004 to the later period 2010 to 2014 for the private sector. Figure 12.3 draws the same comparison for the public sector. The average length of experience has fallen for Professional Engineers level 1 and 2 in both the private and the public sectors, with the reduction much smaller for the former. The average length of experience has increased for levels 3, 4, 5 and above level 5. The increases were typically greater in the private sector Average Ages Census statistics showed that the average ages of the engineering labour force and engineers employed in engineering occupations were remarkably stable between 2006 and Chapter 9 explored how changes in five year age groups contributed to these results. Here we explore how changes in the average ages at different responsibility levels play a role. Table 12.3 presents the statistics for the average ages of private sector Professional Engineers from 2000 to 2014 in each responsibility level and Table 12.4 presents the same information for public sector engineers. Three diagrams assist interpretation of these statistics; Figure 12.4 compares the fifteen year average age of private and public sector engineers in each responsibility level. Figures 12.5 and 12.6 compare the longer term average age to two five year periods; 2000 to 2004 and 2010 to Table 12.3: Average Age of Professional Engineers in the Private Sector Year Level 1 Level 2 Level 3 Level 4 Level 5 Above L Average 2000 to Average 2000 to Average 2010 to Source: APESMA, Professional Engineer Remuneration Survey Reports, June Engineers Australia 99

114 Table 12.4: Average Age of Professional Engineers in the Public Sector Year Level 1 Level 2 Level 3 Level 4 Level 5 Above L Average 2000 to Average 2000 to Average 2010 to Source: APESMA, Professional Engineer Remuneration Survey Reports, June 60.0 Figure 12.4: Average Ages of Professional Engineers in the Private and Public Sectors Private Sector Public Sector 50.0 Average Age (Years) Level 1 Level 2 Level 3 Level 4 Level 5 Above L5 Responsibility Level At each responsibility level the average age of private sector engineers is younger than public sector engineers: The average age of private sector level 1 engineers over the past fifteen years was 25.2 years and in the public sector it was 26.9 years, 1.7 years older. At level 2, the private sector average age was 29.6 years and in the public sector it was 34.9 years, 5.3 years older. At level 3, the private sector average age was 37.6 years and in the public sector it was 43.1 years, 5.5 years older. At level 4, the private sector average age was 44.2 years and in the public sector it was 48.3 years, 4.1 years older. At level 5, the private sector average age was 47.0 years and in the public sector it was 49.9 years, 2.9 years older. Engineers Australia 100

115 The average age for private sector engineers above level 5 was 49.9 years and it was 53.4 years in the public sector, 3.5 years older Figure 12.5: The Average Age of Professional Engineers in the Private Sector 2000 to to Age (Years) Level 1 Level 2 Level 3 Level 4 Level 5 Above L Figure 12.6: Average Age of Professional Engineers in the Public Sector 2000 to to Age (Years) Level 1 Level 2 Level 3 Level 4 Level 5 Above L5 The average ages of Professional Engineers level 1 in the private sector fell by 0.6 years between 2000 to 2004 and 2010 to Average ages fell for both levels 1 and 2 in the public sector; by 1.8 years and 3.9 years respectively. However, as Figures 12.5 and 12.6 show, the average ages at all other responsibility levels have increased: The average age of private sector level 3 engineers increased by 3.2 years compared to 2.0 years in the public sector. The average age of private sector level 4 engineers increased by 3.6 years compared to 2.7 years in the public sector. The average age of private sector level 5 engineers increased by 6.3 years compared to 3.9 years in the public sector. The average age of private sector engineers above level 5 increased by 5.9 years compared to 4.8 years in the public sector. Engineers Australia 101

116 Table 12.5: The Average Age of Professional Engineers Year Private Sector Public Sector Two Combined The weighted average ages in the six responsibility levels were estimated for each sector and are shown in Table There was an uneven upwards trend in average age in both sectors until 2013 but there was a sudden drop in This result is difficult to explain but may reflect the consequences of the collapse in demand for engineers in the past two years Salary Movements This section looks at changes in the salary packages earned by Professional Engineers using the responsibility level framework. Salary packages are the total cost of employment and comprise all cash payments; employer and salary sacrifice superannuation, car allowances, other allowances for overtime, entertainment and parking, bonus payments and payments relating to fringe benefit taxes. Private sector salary packages are shown in Table 12.6 and Table 12.7 provides the corresponding statistics for the public sector. Salary packages show that engineers are comparatively well remunerated but how packages respond to demand conditions are more readily analysed by looking at annual changes in engineering packages compared to annual changes in a community benchmark. For this purpose, the benchmark used was full time adult earnings in the private and public sectors. Table 12.6: Average Salary Packages for Professional Engineers in the Private Sector Year Level 1 Level 2 Level 3 Level 4 Level 5 Above L Source: APESMA, Professional Engineer Remuneration Survey Reports Engineers Australia 102

117 Table 12.7: Average Salary Packages for Professional Engineers in the Public Sector Year Level 1 Level 2 Level 3 Level 4 Level 5 Above L Source: APESMA, Professional Engineer Remuneration Survey Reports In 2000, private sector packages ranged from $46,727 for level 1 to $151,172 for above level 5; the latter was 3.24 times level 1 packages. Public sector level 1 packages were higher, an average $50,230, but packages for above level 5 engineers were less, an average $148,651, a multiple of 2.96 of level 1. In 2014, the range of private sector salary packages had increased to $73,842 for level 1 to $268,726 for above level 5. The multiple between these levels increased to The range of public sector salaries increased from $80,080 for level 1 to $216,491 for above level 5. However, in the public sector, the multiple between these levels fell to With the exception of some junior salaries, packages in the private sector were typically higher than in the public sector: At level 1, public sector packages exceeded those in the private sector with the exception of At level 2, public sector packages exceeded those in the private sector until The relationship fluctuated somewhat before and after the GFC but in recent years private sector packages have been higher. At level 3, private sector packages have been consistently higher than those of the public sector. This was also the case at level 4 with the gap between the two sectors increasing over time until 2014 when the gap narrowed sharply. The level 4 pattern was repeated at level 5 with a larger gap between the two sectors. Private sector salaries fell sharply in 2014 but remain well above the public sector. Above level 5, the pattern was similar to level 5 with a larger gap between the sectors and a much larger correction in Trends in engineering salaries were analysed in two ways; first by comparing public and private sector trends to movements in full time adult earnings and secondly by examining salary growth over time. Trends in salaries over time are illustrated in Figure Average annual growth rates in salary packages were calculated for each responsibility level in each sector. In turn these were average for the following five year periods: 2001 to 2005; the early stages of the resources boom 2006 to 2009; the period of highest demand for engineers resulting from the coincidence of the resources boom and a boom in infrastructure development 2010 to 2014; the period since the GFC encompassing the end of the resources sector construction boom. Engineers Australia 103

118 These changes are summarised in Table 12.8 which compares them to the corresponding movements in full time adult weekly earnings 26 in each sector used as a benchmark for changes in community remuneration. Changes in graduate starting salaries were also estimated and included in the Table. Table 12.8: Average Growth in Professional Engineer Salary Packages Period Level 1 Level 2 Level 3 Level 4 Level 5 Above L5 Graduate Average Adult Private Sector Full Time Earnings 2001 to to to Public Sector 2001 to to to Figure 12.7: Trends in Engineering Salaries Compared to Full Time Adult Earnings Private Engineers Public Engineers New Graduates FT Adult Earnings Index (2000=100) Salary Movements 2001 to 2005 In the private sector, average salary increases during this period increased with responsibility level but were generally lower than average movements in private sector adult full time earnings. Salary movements for new graduate engineers were higher than all but the most senior responsibility level but were also lower than changes in adult full time earnings. In the public sector, salary movements for levels 2, 3, 5 and 5 were well above movements in public sector full time adult earnings and changes in the most senior responsibility level equalled them. However, salary movements for level 1 and new graduate engineers were well below movements in public sector adult full time earnings. Salary Movements 2006 to 2009 In the private sector, salary movements for engineers at all levels, including new graduates, were near or over double movements in private sector full time adult earnings. This was the period when the demand for engineers was at its highest and excess demand, or skill shortages, were relieved through large salary movements. 26 These statistics were obtained from ABS, Cat No Engineers Australia 104

119 In the public sector, full time adult earnings increased by an average 3.9% per year during this period. Salary movements for engineers level 2, 3 and 5 were well below this, but salary movements for engineers above level 5, level 1 and new graduates were larger but well below the changes in the private sector. In general, public sector salaries lagged reducing their competitiveness with the private sector. Salary Movements 2010 to 2014 Changes in private sector full time earnings in this period equalled those in the preceding one. However, only salary movements for engineers level 5 exceeded the community standard. Salary movements for all other levels, including for new graduates were about half the changes in adult full time earnings and salaries for engineers level 1 and above level 5 actually fell. In 2014, private sector change in adult full time earnings was the lowest in the fifteen year period examined. Only new graduate salaries grew faster than this standard. All other levels of engineers experienced salary reductions. This result confirms the evidence of vacancies surveys that the demand for engineers has collapsed. There was a more inconsistent picture in the public sector. The changes in full time adult earnings were slightly higher than in the private sector, 4.3% per year compared to 4.2%, but all levels of engineers except level 5 experienced small increases well below this level. There was a comparatively large increase for level 5 engineers. In 2014, growth in public sector full time adult earnings slowed to 3.1%. Engineer levels 3 and 4 recorded salary increases at about one third this level and engineer levels 1, 2 and above 5 recorded salary reductions. There was a large increase for engineer level 5. Graduate salaries increased slightly less than full time adult earnings. In summary, the salary movements for engineers outlined in Table 12.8 are consistent with expectations given prevailing labour market conditions the periods analysed. Although there were some unusual changes in the public sector during the year ending 30 June 2014, the evidence confirms the collapse in demand for engineers observed in other statistics. Engineers Australia 105

120 Chapter 13 Change Indicators for the Engineering Labour Market Key Points This Chapter considers three indicators of how the demand for engineers has changed since the 2011 population census. Other Chapters in the Statistical Overview have considered how supply has changed. In the past two years engineering construction trends suggest that the demand for engineers has eased and this has occurred across a wide range of the economy. There have been reductions in activity undertaken on economic infrastructure as well as in the resources sector. Activity levels remain reasonably high mainly because work on projects commenced in the past is being completed. The overhang of this work has fallen dramatically in the past two years suggesting that high current activity levels may be short lived. Trends in new commencements have also turned down although there are some areas of increase. Vacancies for engineers have collapsed. Putting aside the interruption caused by the GFC, the demand for engineers, as indicated by the strength of vacancies for engineers, was far stronger than demand for professionals and workers generally. This is no longer the case. Although other vacancies have fallen in recent times, the fall in vacancies for engineers has been more rapid and greater. This collapse is widespread across all States and Territories and persists as recently as August The Engineers Australia recruitment difficulties survey confirms the trends in engineering construction and vacancies for engineers. The proportion of employers who anticipated recruiting difficulties for the year ahead in 2012 was actually much lower than the proportion that did experience difficulties. Expectations for 2014 are even lower The Need for Change Indicators Throughout the Statistical Overview there have been numerous references to the difficulties of obtaining contemporary statistics about changes in the engineering labour market, a problem that is common to any labour market in which the participants are required to have formal educational qualifications. The census statistics discussed in Chapter 2 provide valuable benchmarks for the structure of the engineering labour market and how it changed between 2006 and But the last census is now three years ago and its usefulness as an indicator of changes in engineering employment and unemployment has diminished over time. What is needed is a set of indicators that provides an objective basis for judging the current status of the engineering labour market. Several Chapters contribute to this requirement; Chapter 5 deals with the number of students completing engineering qualifications and Chapter 6 looks in greater detail at how entry-level completions contribute to increasing the supply to the engineering team. Chapter 7 complements this material by examining how skilled migration adds to the supply of engineers. The focus of these statistics is on how supply has changed. So far as the demand side is concerned, the analysis of salary movements in Chapter 12 is the only indicator that has been considered. Additional indicators of demand can flesh out how much demand changed and perhaps provide an indication of where the changes have occurred. This Chapter examines three such indicators; trends in engineering construction, trends in vacancies for engineers and the results of Engineers Australia s recruitment difficulties survey. Engineers Australia 106

121 13.2 Trends in Engineering Construction ABS engineering construction statistics are released on a quarterly basis and the regular reviews undertaken by Engineers Australia aggregate these data into financial year form to improve comparability with other statistics covered in the Statistical Overview. This has been completed for the financial year ending 30 June 2013 but the statistics to extend this analysis to the financial year ending 30 June 2014 will not be released until later in the year. To compensate for this time lag, discussion will be conducted in two parts; first trends up to 30 June 2013, and second, changes in the first threequarters of (September, December and March quarters) are compared to events during the first three-quarters of Figure 13.1: Trends in National Economic Infrastructure and Total Engineering Construction Work Done Economic Infrastructure Total Engineering Construction Construction Work Done ($M in Prices) Work Done The long term trends in engineering construction on economic infrastructure and in total are illustrated in Figure The growing gap between the two trend lines is the value of engineering construction undertaken in the resources, heavy industry and other sectors. This illustration conveys a strong positive message about these activities with a corresponding up-beat message about the demand for engineers up until 30 June Figure 13.2 shows the annual changes in the components of economic infrastructure over the past ten years, the past five years and in Figure 13.3 shows the annual changes for these periods in the components of the resources and other sectors. Figure 13.2 shows that annual growth in economic infrastructure has been steadily falling, but this has not affected all components evenly. In ; Activity increased in engineering construction on o Harbours o Electricity generation and transmission o Pipelines o Telecommunications Activity decreased in engineering construction on o Roads o Bridges o Railways o Water o Sewerage Engineers Australia 107

122 Figure 13.2: Annual Growth Economic Infrastructure Components, Past Decade, Past Five Years and Last Year 80.0 Last Decade Last Five Years Last Year Growth Rate (%) Figure 13.3: Annual Growth Components of Resources and Other Engineering Construction, Past Ten Years, Past Five Years and Past Year Past Ten Years Past Five Years Past Year Annual Change (%) Recreation Resources Heavy Industry Other Resources & Other Figure 13.3 shows that engineering construction in the resources and other sector has continued to grow but growth slowed markedly in The key factor here was a slowdown in growth in the resources and mining sector which accounted for over 89% of activity in this group. In the first three quarters of , engineering construction on economic infrastructure fell by 6.5% compared to the first three quarters of Two components that increased activity in recorded falls in the first three quarters of ; these were harbours and electricity generation and transmission. The other two components that increased in continued to increase in Of the five components that recoded falls in activity in , roads, railways and water continued to fall but activity on bridges and sewerage stabilised, recording slight increases. In , engineering construction in the resources and other sectors recorded increases mainly as a result of an increase of work done in resources and mining. Engineering Construction Pipeline Engineering construction projects typically span a number of years and while the work done in a particular year is an important indicator of demand in the immediate past, it is also important to examine how much work remains on projects that are already underway and how much new work has Engineers Australia 108

123 commenced. These trends are examined in Figure 13.4 for engineering construction on economic infrastructure and Figure 13.5 for engineering construction in the resources and other sector. Figure 13.4: The Pipeline of Engineering Construction on Economic Infrastructure, Australia Engineering Construction ($M in Prices) Work Commenced Work Done Work Yet to Finish Figure 13.5: The Pipeline of Engineering Construction in the Resources and Other Sectors Work Commenced Work Done Work Yet to Finish Engineering Construction ($M in prices) The activity examined in Figures 13.1 to 13.3 is shown by the blue trend lines in Figures 13.4 and In both cases an important reason underpinning continued increases in engineering construction work done is the large over-hang of work to be completed on projects already underway (red trend lines). This overhang has been substantial for both economic infrastructure and engineering construction in the resources and other sectors. However, as the diagrams illustrate, there were sharp falls in and the indications are this will continue. In the first three-quarters of , activity yet to finish on economic infrastructure fell by 22.6% compared to the first three quarters of and by 26.5% in the resources and other sectors. The third trend shown in Figures 13.4 and 13.5 are the trends in new project commencements. Both trends showed falls in In the first three quarters of , new economic infrastructure commencements fell by 2.4% compared to this period in and new commencements in the resources and other sectors were unchanged. In the latter case a 6.1% fall in new mining commencements was offset by a corresponding increase in recreation and other sectors. Engineers Australia 109

124 The trends analysed in this section suggest that demand for engineers in engineering construction has been falling and is likely to continue to do so. The circumstances that led to skill shortages in the resources sector have worked their way through the system and are unlikely to be repeated. Although the background level of engineering construction on economic infrastructure remains reasonably high, it is much lower than it has been and the indications are that further falls are likely Vacancies for Engineers This section examines trends in vacancies for engineers using the Department of Employment internet vacancies series 27. Figure 13.6 provides the background by comparing trends in vacancies for engineers, vacancies for professionals and all vacancies since the commencement of the vacancies series in January The statistics graphed are the Departments trended indexes and facilitate comparison of the changes that have occurred Figure 13.6: Trends in Vacancies for Professionals, Engineers and Vacancies in General, Australia, January 2006 to August 2014 General Vacancies Professional Vacancies Vacancies for Engineers Index (January 2006=100) Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul Figure 13.7: Monthly Changes in Vacancies for Engineers, Past Two Years, Past Year and Past Three Months Past Two Years Past Year Past Three Months Monthly Change (%) AUSTRALIA NSW VIC QLD SA WA TAS NT ACT 27 See lmip.gov.au/default.aspx?lmip/vacancyreport Engineers Australia 110

125 Figure 13.6 shows that professional vacancy levels have been proportionally higher than vacancies in general throughout the period illustrated and this remains the case. The large increase in demand in the lead up to the global financial crisis (GFC) is clearly evident as it the large reduction in demand caused by the crisis. Although there was a rapid recovery from this event, this was not sustained and was followed by a period of falling vacancies so that in recent months the trends have been well below their January 2006 starting values. Against this background, the trend in vacancies for engineers shows extremes of highs and lows. The pre-gfc build up in the demand for engineers was extraordinary compared to the other two trends. So too was the collapse brought about by the GFC but it is important to note that at the depths of this collapse the level of vacancies for engineers was close to the January 2006 level and conditions then were fairly strong. Post-GFC recovery was almost as strong as the earlier period and lasted about two years. Since then vacancies for engineers have fallen for 29 successive months until mid-2014 and have flattened out at about half the level of January Figure 13.6 clearly shows that the collapse in vacancies for engineers was far more severe than the soft conditions in the labour market generally. Figure 13.7 takes a closer look at recent monthly changes in vacancies for engineers and looks at the situation in States and Territories as well as for Australia as a whole. The diagram illustrates average monthly changes in vacancies for engineers over the past two years, the past year and the past three months. There is little good news in this diagram. Vacancies continue to fall for Australia overall and in most jurisdictions. The exception is in NSW where increases in vacancies for engineers are increasingly evident. The apparent large changes in Tasmania and the ACT are distortions resulting from almost insignificant changes on small reduced base figures. Trends in vacancies for engineers confirm that the demand for engineers in Australia has collapsed and that this has been widespread and not confined to resources States Recruitment Difficulties Survey Since 2007, Engineers Australia has included several questions in its annual salaries survey to explore the recruiting difficulties experienced by employers seeking to hire engineers. The most recent survey was in December 2013 and this section examines the results as a final indicator of the demand for engineers. Survey results are helpful indicators of the direction of change and more limited in indicating the actual level of these difficulties in the market place 80 Figure 13.8: Respondents Who Experienced Difficulties Recruiting Engineers During the Past 12 Months % Of respondents Engineers Australia 111

126 Figure 13.9: Recruiting Difficulties Experienced By Grade Sought in 2013 Compared to the Medium Term Average 30.0 Average to % of Affected Vacancies Engineer level1 Engineer level 2 Engineer level 3 Engineer level 4 Engineer level 5 Figure 13.10: Recruiting Difficulties Experienced by Location Compared to the Medium Term Average 25.0 Average since % of Affected Vacancies NSW Victoria Queensland WA SA Tasmania NT ACT Figure 13.11: Difficulties Experienced Recruiting Engineers in 2013 Compared to the Medium Term Average 2013 Average since 2006 Other Recruited different skill set & retrained Paid higher than expected salary Could not recruit at all Longer recruitment period Could not recruit required skill set % of Respondents Engineers Australia 112

127 Figure 13.12: The Consequences of Recruiting Difficulties Experienced in 2013 Compared to the Medium Term Average 2013 Average since 2006 Did not proceed with available project Major problems, including project delays & costs Moderate problems with some monetary problems Minor irritation but no monetary issues % of Respondents The trend in the proportion of employers who experienced difficulties recruiting engineers reflects the trends in vacancies for engineers as shown by comparing Figure 13.8 with Figure During the first three years of the survey, three quarters of employers experienced recruiting difficulties. The GFC took some of the heat out of the situation but still over half of employers experienced difficulties in As recovery from the GFC proceeded, this proportion increased to over 60%, but the proportion stalled in 2012 and collapsed in 2013 to just 34% reporting difficulties recruiting engineers. As well as fewer employers experiencing difficulties recruiting engineers, there has been an easing of difficulties experienced in recruiting engineers levels 1 to 3 and an increase in the difficulties experienced recruiting more senior engineers. Figure shows that recruiting difficulties eased in Queensland Western Australia and South Australia but increased in the other jurisdictions. Most specific recruiting difficulties experienced in the past eased as illustrated in Figure Finally, the consequences of recruiting difficulties shifted away from major problems towards more moderate and minor problems. 70 Figure 13.13: Expectations of Future Recruiting Difficulties % of Respondents The proportion of employers who experienced recruiting difficulties in 2013 exceeded the expectations of employers the previous year. In the 2012 survey 44% of employers said they expected recruiting Engineers Australia 113

128 difficulties in 2013 compared to 34% actually experiencing difficulties in As Figure shows, 29% of employers expect to encounter difficulties in Engineers Australia 114

129 Chapter 14 The Engineering Labour Market in 2014 Main Points Engineering is a complex profession requiring intensive and extensive education and training over a long period, life-time professional development, numerous areas of specialisation and specialisation is often dependent on engineering practice. These characteristics mean that engineering is not governed by a single labour market for homogeneous engineering skills but numerous labour markets conditioned by specific engineering skills and experience levels. In recent years, the supply of engineers in Australia has grown rapidly. The major source of growth has been skilled migration and recent intakes are at near record levels. Supply from domestic sources has also increased as more students complete engineering qualifications. These circumstances indicate that the supply of engineers continues to increase strongly. In contrast, in the past few years the demand for engineers has collapsed. There are several factors involved including slow macroeconomic growth, decreased levels of investment in economic infrastructure and the transition of the resources boom from its construction phase to production. The combination of these circumstances indicates that the engineering labour market has changed abruptly to one of over-supply Assessing the Engineering Labour Market This Chapter draws on the material covered by the Statistical Overview to assess the status of the engineering labour market. The ideal, and simplest, statistics for this task would be ABS Labour Force Survey time series for employment, unemployment and the labour force constrained by the educational qualifications required to be an engineer. As has been explained at several points, this ideal cannot be achieved at present and a more complex process involving surrogate indicators for changes in supply and demand is necessary. The assessment that follows looks at the macroeconomic situation, a common enough approach. However, a number of caveats need to be borne in mind when formulating judgments based on the available evidence. These include: Engineering is not homogeneous but is distinguished by extensive educational training, post education on-the-job specialisation into numerous fields and the capacity and experience to practice engineering independently. The demand for engineers has no substitutes and attempts to employ other skills are high risk and high cost. Similarly, substitutability between engineering specialisations is limited. The supply of engineers, however, can be employed in engineering and in a wide range of other analytical and problem solving areas. Throughout the Statistical Overview we have distinguished between people who hold recognised engineering qualifications and those who employ these qualifications in engineering occupations. At this stage the majority of available statistics relate to the former, but at a practical level when the demand for engineers is less than supply, many qualified engineers find employment in the broader economy. Whether they return to engineering depends on how long they are away from engineering and their personal assessment of life beyond engineering. This process is not yet well understood but it appears to be at the core of periodic skill shortages. Engineers Australia 115

130 14.2 Changes in the Supply of Engineers Between 2006 and 2011 the supply of qualified engineers grew by 5.6% per year adding an additional 63,275 to the engineering labour force; 18,109 were already resident in Australia 45,166 were new skilled migrants. The growth rate for Australian born supply was 3.3% per year and for overseas born supply it was 7.9% per year. Since 2011, the supply of engineers has increased as domestic students complete entry level engineering qualifications and join the labour market and as additional skilled migrant engineers are granted the necessary visas. The supply of engineers is reduced by age retirement of engineers and by retirement from the labour market for family formation and further studies. Statistics are available to estimate the increases in supply but a major gap is statistics on departures. In 2011, the supply of Australian born engineers was 121,528. Table 6.7 brought together statistics on the completion of entry level engineering qualifications for Professional Engineers, Engineering Technologists and Associate Engineers. The average annual growth in numbers from this source was shown to be 6.6% for 2011 to 2013 inclusive. Acceptances of places in university engineering courses have continued to increase and so too have entry level course commencements. It is reasonable to assume therefore that this growth will continue through into The cumulative increase since the census has been about 27,300. Between 2006 and 2011, educational completions added 38,200 to domestic supply and the net increase in supply was 18,104. Assuming retirement behaviour in the past three years is unchanged from the inter-census period, this ratio was used to discount the number of education completions to a net increase in supply of 12,900. In other words, domestic supply in 2014 is estimated at 134,400 suggesting that the increase in annual education completions has increased domestic supply growth to 3.4% per annum. In 2011, the supply of overseas born engineers was142,362. Estimating an approximate increase in supply since then is more difficult because as well as the complications associated with retirements, large numbers of migrant engineers work in Australia on temporary visa ranging from a few months to four years duration. Since 2011, 26,506 permanent visas have been granted to migrant engineers and another 23,937 temporary visas. Some temporary visas holders have probably completed their contracts and returned to home countries, others have been sponsored by employers for permanent visas and are included in those statistics and an unknown remainder are still on temporary visas. Suffice it to say that the analysis in Chapter 7 showed that in the past three years annual permanent migration has increased by 15.2% per year compared to 16.1% for the period since In other words, the increase in the supply of engineers from skilled migration has continued to increase at a rate similar to the inter-census period. The conclusion that can be drawn from these considerations is that the supply of engineers has continued to increase by about 6 to 6.5% per year Changes in the Demand for Engineers Between 2006 and 2011, the demand for engineers increased by 5.5% per year, slightly lower than the increase in supply. Since then the changes that have occurred include: A collapse in vacancies for Engineers. A downturn in engineering construction on economic infrastructure with rapid completion of projects underway and falling new commencements. The end of the resources sector construction boom with high current activity levels largely supported by a large over-hang of work to be completed on projects underway and with new commencements falling. Falls in average salary packages for engineers at all levels across both private and public sectors. Engineers Australia 116

131 Comparatively low economic growth below its trend level. These indicators suggest that the demand for engineers has fallen well below the levels recorded between census years. As projects underway are completed, it is likely that demand will fall further. Engineers Australia 117

132