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Baccalaureate and Master's Engineering Degree Supply And National Center for Higher Education Management Systems Baccalaureate and Master’s Engineering Degree Supply and Demand in Wisconsin Submitted to University of Wisconsin System Revised October 20, 2014 Introduction The University of Wisconsin System contracted with the National Center for Higher Education Management Systems (NCHEMS) to determine “the extent and nature of shortages of engineers needed in the Wisconsin workforce, if any.” Based on that information, NCHEMS was asked to “provide recommendations as to cost-effective approaches to responding to any identified shortages.” This report has been prepared in response to that charge. In this report we provide information about the supply and demand for engineers in various specialty areas, both statewide and in different regions within the state. In addition we analyzed data that provide a deeper understanding of the market, both current and potentially the future, for engineering talent in Wisconsin. These analyses include: • A comparison of engineering employment in Wisconsin vis-à-vis employment nationally and in the states that border Wisconsin • An assessment of migration of engineers into and out of Wisconsin • A comparison of salaries paid to engineers in Wisconsin with salaries paid in Border States • A determination of the age distribution of engineers in Wisconsin. Is there any evidence of a likely wave of retirements that would affect demand for engineers? Major findings are noted in the report. At the end of the report we make recommendations concerning cost-effective ways of addressing identified needs. Current Production of Employed Engineers Degrees in Wisconsin (Supply) Almost 2.9 million people were engaged in non-farm employment in the state of Wisconsin in August 2013 and most of this employment occurred in the manufacturing, government, health care, and retail industries (Current Employment Statistics, Worknet, Wisconsin Department of Workforce Development). Estimates from the federal Bureau of Labor Statistics indicate that in May 2013 there were just over 30,500 engineers employed in Wisconsin. In 2013 a total of 2,447 bachelor’s and master’s degrees in engineering were granted by public and private Wisconsin colleges and universities. (For-profit institutions have little effect on engineering education in Wisconsin and are not included in analyses.) Private Non-Profit institutions in Wisconsin provide a larger portion of baccalaureate engineering degrees (30.3%) compared to the percentage provided by this same type of institution in the rest of the country (22.1%). Public institutions grant a higher proportion of master’s degrees in Wisconsin than is true in the rest of the country. Baccalaureate and master’s data are treated separately except in those cases where data are only available for aggregated bachelors and graduate/professional degree levels. Page 1 National Center for Higher Education Management Systems Table 1. Total Degree Production by Institutional Control, Wisconsin and Nation, 2013 Baccalaureate Degrees Master’s Degrees Institutional Wisconsin Nation Wisconsin Nation Type % of % of % of % of N N N N Total Total Total Total Public 1306 69.7% 66724 77.6% 481 84.1% 85980 76.2% Private Non- 569 30.3% 18963 22.1% 91 15.9% 26569 23.6% Profit Private For- 0 0.0% 293 0.3% 0 0.0% 247 0.2% Profit Total 1875 100.0% 85980 100.0% 572 100.0% 112796 100.0% This level of engineering degree production in the state was compared to the current engineering employment in the state (see data in Table 2). These analyses were extended to the Border States. From these analyses it is clear that Border States contain institutions that have faculty expertise in different engineering areas. For instance, Wisconsin produces a large number of agricultural and biomedical engineers relative to the nation and to employment in the state of Wisconsin. States that border Wisconsin (Illinois, Iowa, Michigan, and Minnesota) produced substantially more agricultural engineers (Illinois), biomedical (Illinois, Iowa, Michigan), chemical (Iowa), computer hardware (Iowa), and materials engineers (Illinois, Iowa, Minnesota) than Wisconsin in 2013. Later we explore whether those are the types of engineers that might be needed within Wisconsin. Table 2. Bachelor’s and Master’s Employed Engineers Degrees Awarded per 100 Employed Engineers, by Engineering Discipline by State, 2013 Type of Border States Employed Wisconsin Nation Engineers Illinois Iowa Michigan Minnesota Total 8.0 8.5 15.2 6.2 6.0 8.2 Aerospace -- 31.0 -- -- 30.4 6.7 Agricultural 71.4 140.8 10.0 -- -- 48.8 Biomedical 76.2 128.9 190.0 122.5 7.8 34.0 Chemical 30.8 24.3 90.6 44.2 26.9 27.0 Civil 8.4 8.2 13.7 8.1 7.0 7.1 Computer 15.5 11.7 67.1 34.8 5.6 8.3 Hardware Electrical and 5.7 12.4 15.0 9.8 8.2 7.4 Electronic Page 2 National Center for Higher Education Management Systems Environmental 2.6 4.7 0 5.5 0 3.8 Industrial 2.2 2.7 4.6 1.5 0.3 2.2 Marine 0 -- -- -- -- 6.9 Materials 9.4 24.1 44.4 11.4 26.3 8.2 Mechanical 8.5 6.6 13.9 4.4 7.0 10.8 Mining -- 6.5 -- 31.4 4.3 7.6 Nuclear 30.0 6.5 -- 15.8 0 5.8 Petroleum -- -- -- 0 -- 4.4 Other 15.3 5.5 14.7 7.5 6.3 13.5 Finding 1. Relative to employment, production of engineering degrees in Wisconsin is greatest in the areas of agricultural and biomedical engineering. Border States have production capacity in areas in which Wisconsin produces few degrees in relation to employment. Page 3 National Center for Higher Education Management Systems Current Demand for Degreed Engineers in Wisconsin In this section of the report, we investigate various factors that could affect decisions about taking steps to increase production of engineers in the state – migration of engineers, the age distribution of engineers, and wages paid to the engineers. Migration of Engineers Into and Out of Wisconsin The question of need for engineers is determined not just by supply and demand within Wisconsin, but by migration of engineers into and out of the state. Using the American Community Survey (ACS), an annual survey conducted by the U.S. Census Bureau to gauge activity between census dates, the migration of degreed engineers from one state to another was estimated. Because ACS data are estimates, only those which are within a reasonable margin of error were used. In terms of the average annual net migration of engineers by state between 2008 and 2012, we find that Wisconsin is an overall exporter of baccalaureate degrees; no conclusion can be drawn with regard to master’s degrees. Compared to Border States, Minnesota was an importer of engineers with baccalaureate degrees in the same time frame and Michigan was an importer of engineers with master’s degrees. Table 3 below presents similar data by type of engineering for the same time frame. (Note that the type of engineering categories is slightly different in order to maximize statistical power of available data.) Wisconsin is an overall exporter of industrial and mechanical engineers and an importer of civil and electrical and electronic engineers. From the table we also see that Illinois exports civil engineers and both Michigan and Minnesota export electrical and electronic engineers. These data do not indicate destination so it is unknown exactly where exported engineers went. Finding 2. Overall Wisconsin is a net exporter of engineers – more engineers leave the state than come in. Wisconsin is a net importer in two areas, civil engineers and electrical and electronic engineers. Border States are net exporters of these types of engineers meaning that shortages in Wisconsin can potentially be addressed by attracting engineers from neighboring states that have surpluses of such engineers. Table 3. Estimates of Average Annual Net Migration of Engineers by Employed Engineers Type, 2008-2012 Type of Employed Border States Wisconsin Engineers Illinois Iowa Michigan Minnesota Total Exporter Importer -- -- -- (~390) (~480) Aerospace Exporter -- -- -- -- (~60) Biomedical Importer -- -- -- -- (~90) Chemical Importer -- -- -- -- (~80) Page 4 National Center for Higher Education Management Systems Civil Importer Exporter Importer -- -- (~100) (~190) (~230) Computer -- -- -- -- -- Hardware Electrical and Importer Exporter Exporter -- -- Electronic (~190) (~120) (~440) Environmental Exporter -- -- -- -- (~40) Industrial Exporter Importer Importer -- -- (~380) (~240) (~110) Marine -- -- -- -- -- Materials -- -- -- -- -- Mechanical Exporter Exporter Importer Importer (~130) (~180) (~710) (~220) Mining and Importer -- -- -- -- Petroleum (~140) Nuclear and Misc Importer -- -- -- -- (~250) Age Distribution of Engineers Another area which can signal a coming demand for engineers is those who are close to retirement age. The ACS survey also provides data which are useful for this analysis. See Table 4 below for the estimated percent of engineering jobs filled by individuals who are 50 years of age or older. Cells in green indicate a younger workforce (<25% are 50 and older) while cells in red indicate an aging population (>45% are 50 and older). Iowa has a younger engineering workforce overall. Wisconsin has younger workers in chemical and computer hardware engineering and older workers in environmental engineering. Finding 3. Overall, mass retirement of engineers does not appear to be a looming problem in Wisconsin. Table 4. Estimates of the Percent of the Annual Employed Engineers Employment of Individuals who are age 50 or Older, 2008-2012 Type of Employed Border States Wisconsin Nation Engineers Illinois Iowa Michigan Minnesota Total 30.8 32.6 24.6
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