2015 U.S.

Compensation Outlook:
Salaries Edging Upward
As the recession slowly recedes and Americans continue
to gain confidence about a slow but steady economic
recovery, U.S. workers will see their salaries track a
slight upward trajectory in 2015. The newest Mercer
2014/2015 U.S. Compensation Planning Survey says
American employees can expect a median base salary
increase of 3.0 percent in 2015, up just slightly from
Mercers reported 2014 median increase of 2.9 percent.
Mercers 2015 projection is expected to hold fairly
steady across most industries and suggests that regional
fluctuations will be negligible, ranging a maximum of
0.2 percent.
For example:
North Central and South Central budgets are in line
with the national average of 3.0 percent.
Northeast, Southeast and West Coast regions are
slightly lower, hovering between 2.8 percent and
2.9 percent.
This years anticipated boost exemplifies the trend
of paychecks inching upward year over year in the
post-recession economy. For example, an Aon Hewitt
survey reports that the average pay raise for salaried
employees climbed to 3.7 percent in 2008 and then
fell to an all-time low of 1.8 percent in 2009 when
the economic tumble was in full force. Since then,
employees have seen slight pay improvements, and this
years anticipated 3.0 percent figure will be the highest
percentage gain since the 2009 low point.

U.S. employers on track to increase median

base salaries by 3 percent

Rationale for Raises

In the Mercer survey, 99 percent of the more than 1,500 participating companies expect to raise salaries
in 2015. A solid majority (68%) of those organizations report their primary reason for doing so relates to
greater competition for their workforce or anticipated labor shortages and concern over retention and losing
good employees.
To illustrate the effect of salaries on talent retention strategies, the Mercer data shows that employers
continue to tie pay hikes to performance and reward top employees with raises averaging 4.8 percent, while
the weakest performers averaged a pay increase of just 0.1 percent. Additionally, variable pay plans are now
the norm and encourage ongoing high performance by offering monetary rewards that employees must earn
on an annual basis.

RA

of companies expect to

are rewarded

ISE

99%

with raises

averaging

4.8%

salaries in 2015
Source: Mercer 2014/2015 US Compensation Planning Survey

Theres No Escaping the Fundamental Appeal of Money

In its 2014 Global Workforce Study, the professional
services firm Towers Watson studied how a workers
age impacts the importance of compensation. The
result? Regardless of age, employees most frequently
cited base pay as the motivation for joining or leaving
an organization.
Randstad recorded a similar result in its 2014 Workplace
Trends and Salary Survey of hiring managers across the
United States. When asked why employees resign, over
half (59%) of respondents said the number-one reason
employees depart is to accept a better offer of pay/
benefits elsewhere.

Randstad Engineering: 2015 Salary Guide

The Bottom Line

Although salaries continue to move upward, this
years limited increase indicates that employers do
not feel extreme pressure to focus on employee pay
as a recruiting and retention strategy, which likely
reflects the measured tempo of the post-recession
economic recovery. However, as more employment
choices become available and companies intensify
their recruiting efforts, workers expectations for salary
augmentation will likely rise as well. Now is the time
for employers to adjust their compensation plans in
preparation for the next wave of economic growth.

Gen Y vs. Gen Z:

Whos Most Motivated by Money?
When it comes to the importance of earning more money,
do Gen Ys think differently than Gen Zs, the youngest
demographic group currently entering the workforce?
In the first study of its kind, Randstad US and Millennial
Branding compared the workplace expectations of Gen Y
(ages 21 to 32) and Gen Z (ages 16 to 20). Money ranked
as a top-three work motivator for both groups; however,
Gen Ys report that money is their primary motivator to
work harder and stay with their employer longer, whereas
younger Gen Zs are most interested in advancement
opportunities.

(ages 21 to 32)

(ages 16 to 20)
Source: Randstad US/Millennial Branding, 2014 Gen Y vs. Gen Z
Workplace Expectations Study (global results)

Variable Pay Plans:

Growing in Popularity
While the majority of employees can expect
their wallets to be a bit fatter this year, highperforming workers will fare even better
and see the biggest payoff for their efforts.
Companies nationwide continue to focus on
retaining and engaging top performers and
are willing to pay more for the best, which
explains why growing numbers of companies
are adopting variable pay incentives.

How popular are alternative pay plans?

Aon Hewitt says 90 percent of companies offer
broad-based variable pay plans, and in 2015
employers expect to spend 12.7 percent of payroll
on variable pay for salaried exempt employees.

Five-year trend of average base pay increases

Variable compensation is a pay-forperformance model that is budgeted for

separately from fixed-cost base salaries.
Employees generally earn variable pay
incentives on an annual basis for meeting
business and individual goals, which allows
companies to hold the line on base pay and
incentivize workers at all levels with rewards
tied to performance.
Source: Mercer 2014/2015 US Compensation Planning Survey

What Were Seeing:

Salary Insights from Randstad
With more than 5,000 workforce specialists in the United States, our field offices are well-suited to spot salary
trends and observe current dynamics within recruiting and hiring. Weve therefore asked our recruiting teams
across the country to share their salary-related observations and have compiled their thoughts in the Q&A
below. The information cited here does not apply to every industry or geographic area but instead reflects the
most significant trends reported by our teams.

What salary trends has the

engineering profession experienced
in the last 12 months?
The industry is in flux. Engineering professionals know they are in high demand
and as such are demanding higher pay, but many employers are not yet meeting
the talent pools increased salary requirements. Candidates frequently receive
several competing offers, and weve therefore seen new-hire pay inching up, but
not nearly to the level expected by candidates and especially by those who are
currently employed.
As a result, most candidates are content to stay with their current employer vs.
move to another company for the same pay, especially if they are in line for a
promotion and dont want to become the low person on the totem pole at a
new organization.

What particular effects does the constricted labor

market have on the engineering profession?
Many companies need engineers with five to 10 years experience. However five
years ago we were still in a recession, and many candidates were unable to find
jobs, especially entry-level positions. The result was that fewer engineers entered
the workplace, and we now see extreme competition for mid-level professionals.
On the one hand, employers need to increase salaries to attract talent with the
desired experience, and on the other hand they must extend counteroffers to
current employees to keep these tenured individuals on board. This is a very
different market than a few years ago when higher unemployment tempered
engineering salaries.

Randstad Engineering: 2015 Salary Guide

What strategies are employers taking to

attract and retain employees in addition to
offering higher salaries?
Weve seen companies sweeten new-hire deals by offering flex time or adjustable
work hours, increased 401(k) matches and more generous vacation or PTO
packages. Weve also seen companies give promotions to current employees so
as to retain them, and in some instances organizations have offered employees
reduced work schedules in tandem with a pay increase. Companies are also more
open to bringing in nonlocal talent, which has caused greater negotiation on
relocation packages or signing bonuses in lieu of increased salaries.

What regions of the United States have

recently experienced the most salary change
for the engineering profession?
Hiring activity in Detroit and much of the central United States has picked up in
response to the automotive industry recovery, with salaries moving upward as
well. Houston is also a hotbed for engineering activity, and the war for talent is
particularly high in that metropolitan area. Los Angeles (and California in general)
is another area where engineering hiring is expanding rapidly.
It used to be taboo for engineering candidates to have jumpy job histories, but
now we see an increased number of candidates move from company to company
for more money because they are in such high demand.

Randstad Engineering: 2015 Salary Guide

Are there situations in which employers

dont need to compete on salary?
Money and commute are of paramount importance to employees, so one
scenario producing reduced salary negotiations is when candidates compare job
offers with significantly different travel or relocation requirements. In these cases,
candidates will frequently accept a lower salary so they can stay closer to home.
Another instance when salaries do not dominate occurs when a new or exciting
employment sector opens up and many people want to work in it. For example,
weve seen environmental/civil engineers take a pay cut so they can get into
energy/sustainability companies because they knew the future is strong for that
particular industry.

Using the Randstad Salary Guide

for Engineering Positions
The data presented within this section represents a geographic listing of starting salary ranges typical for
new hires with approximately three to seven years experience. Each job title listed includes three salary
data points: low (25th percentile), mid (50th percentile) and high (75th percentile).
Please note that salaries in your area may vary based upon local market conditions and position-specific
requirements such as experience levels, professional certifications or certain software knowledge. In
addition, the salary data has been drawn from multiple industries and may not accurately portray a
companys specific situation.
Salary data was provided by Economic Research Institute (ERI). ERI is a widely known provider of robust job
competency, cost-of-living, executive compensation and salary surveys (containing 565,000 organizations
data). www.erieri.com
Because every organization structures its internal departments differently, the job titles presented here
may not match those within your organization. For more detailed information and market-specific analysis,
please contact one of our staffing and recruitment specialists at your local Randstad office.

Salary Key
Salary data is reported for six geographic areas:
Midwest
Illinois
Indiana
Iowa
Kansas
Michigan
Minnesota
Missouri
Nebraska
North Dakota
Ohio
South Dakota
Wisconsin

Mountain
Arizona
Colorado
Idaho
Montana
Nevada
New Mexico
Utah
Wyoming

Northeast
Connecticut
Maine
Massachusetts
New Hampshire
New Jersey
New York
Pennsylvania
Rhode Island
Vermont

Pacific
Alaska
California
Hawaii
Oregon
Washington

Southeast
Alabama
Delaware
Florida
Georgia
Kentucky
Maryland
Mississippi
North Carolina
South Carolina
Tennessee
Virginia
Washington, DC
West Virginia

West South Central

Arkansas
Louisiana
Oklahoma
Texas

Midwest
Job Title

Low

Mid

High

Aerospace Engineer

$73,323

$80,902

$90,697

Biomedical Engineer

$67,250

$72,445

$79,157

Civil Engineer

$62,516

$68,550

$76,374

Electrical Engineer

$71,730

$78,670

$87,639

Electronics Engineer

$66,961

$73,434

$81,817

Engineering Manager

$99,575

$109,702

$122,706

Instrumentation/Controls Engineer

$51,445

$56,371

$62,779

Manufacturing Engineer

$60,902

$66,776

$74,396

Mechanical Engineer

$67,486

$74,011

$82,458

Quality Engineer

$58,120

$63,716

$70,982

Mountain
Job Title

10

Low

Mid

High

Aerospace Engineer

$72,243

$79,871

$89,729

Biomedical Engineer

$66,180

$71,376

$78,097

Civil Engineer

$61,478

$67,483

$75,302

Construction Manager

$83,225

$91,997

$103,233

Electrical Engineer

$70,649

$77,624

$86,644

Engineering Manager

$95,666

$105,544

$118,265

General and Operations Manager

$75,036

$83,378

$94,178

Instrumentation/Controls Engineer

$50,467

$55,312

$61,641

Manufacturing Engineer

$59,880

$65,715

$73,318

Mechanical Engineer

$66,415

$72,945

$81,420

Randstad Engineering: 2015 Salary Guide

Northeast
Job Title

Low

Mid

High

Biomedical Engineer

$72,643

$78,276

$85,519

Civil Engineer

$67,533

$74,066

$82,507

Construction Manager

$91,033

$100,443

$112,485

Electrical Engineer

$77,483

$85,013

$94,703

$111,696

$122,806

$137,004

General and Operations Manager

$88,802

$98,477

$110,829

Instrumentation/Controls Engineer

$55,454

$60,775

$67,655

Manufacturing Engineer

$65,792

$72,150

$80,366

Mechanical Engineer

$72,898

$79,971

$89,093

Quality Engineer

$62,792

$68,847

$76,675

Engineering Manager

Pacific
Job Title

Low

Mid

High

Aerospace Engineer

$81,970

$90,326

$101,048

Biomedical Engineer

$75,255

$81,015

$88,397

Civil Engineer

$70,006

$76,712

$85,334

Construction Manager

$93,990

$103,481

$115,635

Electrical Engineer

$80,212

$87,872

$97,704

$110,557

$121,532

$135,571

Instrumentation/Controls Engineer

$57,665

$63,163

$70,261

Manufacturing Engineer

$68,215

$74,749

$83,154

Mechanical Engineer

$75,517

$82,743

$92,024

Quality Engineer

$65,124

$71,359

$79,385

Engineering Manager

Randstad Engineering: 2015 Salary Guide

11

Southeast
Job Title

Low

Mid

High

Biomedical Engineer

$66,631

$71,945

$78,767

Civil Engineer

$61,820

$67,977

$75,928

Construction Manager

$83,966

$92,847

$104,208

Electrical Engineer

$71,193

$78,295

$87,428

Engineering Manager

$99,352

$109,639

$122,809

General and Operations Manager

$77,802

$86,595

$97,889

Instrumentation/Controls Engineer

$50,460

$55,445

$61,908

Manufacturing Engineer

$60,182

$66,171

$73,910

Mechanical Engineer

$66,872

$73,542

$82,137

Quality Engineer

$57,360

$63,060

$70,431

West South Central

Job Title

Mid

High

Chemical Engineer

$72,635

$80,645

$90,885

Civil Engineer

$61,153

$67,463

$75,578

Construction Manager

$83,825

$92,968

$104,571

Electrical Engineer

$70,727

$78,035

$87,378

Engineering Manager

$96,839

$107,089

$120,201

Instrumentation/Controls Engineer

$49,444

$54,501

$61,036

Manufacturing Engineer

$59,484

$65,618

$73,510

Mechanical Engineer

$66,308

$73,161

$81,948

Petroleum Engineer

$102,262

$111,648

$123,571

$56,613

$62,441

$69,947

Quality Engineer

12

Low

Randstad Engineering: 2015 Salary Guide

Sources
Aon Hewitt Survey
http://aon.mediaroom.com/2013-08-29-Aon-Hewitt-Survey-Shows-2014-Salary-Increases-to-Reach-Highest-LevelsSince-2008
Mercer 2014/2015 US Compensation Planning Survey
http://www.mercer.com/newsroom/pay-raises-for-us-employees-continue-to-grow-steadily-new-mercer-survey-finds.html
Randstad US and Millennial Branding, 2014 Gen Y vs. Gen Z
Workplace Expectations Study
http://www.randstadusa.com/about/news/millennial-brandingand-randstad-us-release-first-worldwide-study-comparing-geny-and-gen-z-workplace-expectations/
SHRM (Society for Human Resource Management)
http://www.shrm.org/hrdisciplines/compensation/articles/pages/variable-pay-high.aspx
Towers Watson 2014 Global Workforce Study
http://www.towerswatson.com/en-US/Insights/IC-Types/Survey-Research-Results/2014/07/balancing-employer-and-employee-priorities

About Randstad US
Randstad US is a wholly owned subsidiary of Randstad
Holding nv, a $22.0 billion global provider of HR services. As
the third largest staffing organization in the United States,
Randstad holds top positions in permanent placement, office
and administrative, IT and accounting and finance. From
professional services, commercial staffing and recruitment
process outsourcing to managed services and more, Randstad
delivers a comprehensive range of temporary, temporaryto-hire, permanent placement and outsourced placement
services. With its 5,324 employment experts, Randstad puts
approximately 100,000 people to work in the United States
each week through its network of nearly 1,000 branches and
client-dedicated locations.

www.randstadengineering.com