Engineering and Technology Careers are Not Valued - Singapore is "High Cost Low Tech"

You said it right - the number of PEs and CTOs are a lot lesser than bankers, and naturally as a result millionaire employees among them would be lesser. This is a simple case of maths.

The focus now is on, why is banking so highly glamorized? Answer - because with banking you can achieve instant high gains due to commission (and for that matter, any sales job) Not true for engineering jobs, where you have to work your way up steadily. Youngsters nowadays look at fast gains and results (just look to the slimming centres nowadays - who needs exercise? But it is well known that exercise is the best way of losing weight)

And I also know a fren who's an electrical engineer - he works for a US company and takes home a 5 figure salary too (in USD) but he's singaporean. And he is not even 30.

I am an ex-engineer working in a bank as some calls it front office treasury role.

As for the question on why engineers are lowly paid compared to bankers, it all boils down how much money can you bring to the firm.

E.g. I used to work as R&D engineer, and I work together wih 10+ R&D engineers to innovate 1 product, and a assembly line with another set of product engineers, technicans and factory workers to produce the finished product. Besides of the huge human resources requirements, there are large capital expenditures e.g. machines, factories. The margin is low with high overheads (engineer pay is one major overhead).

In a bank on financial markets, there is product developement team called the quants, abt 3-4 people with phd in maths, who comes up with new structured products and risk management solutions, a desk of 3 traders who manage the risks, a few sales to push the product. There is a middle/back office settling the trades, etc. For a relative small operations, the pnl can be enormous at roughly 5% of volume, thus can be around USD25mio/yr. Divide the bounty between 5-10 FO staff, and you can see how much bonus they get.

begtodiffer

That's the best answer! I think generally there are 2 sectors in any industry. (1)The people who help to create a product, and (2)the people who help to sell a product. Engineers fall into category (1). The more you pay them, the less profit the company make. Sales is in category (2). The more you pay them, means they are bringing more profit. Assume the sales earn 20% of total sales, so if they make $200k a year, means the company make $800k a year! A top sales always win a top engineer/lawyer/doctor/pilot handsdown. Sim Wong Hoo is the best example, he can easily become a engineer in a big MNC, but he chose to sell soundcards!

Also, are you aware that PE hold tremendous high responsibility and the reward is peanuts. Look at those PEs involved in the Nicholl Highway incident. Being charged and sued. May end up in jail .

A Professional Engineer (PE) is allow to submit plans and provide consultancy for a project. However, the market is competitive and thus the fees are miserable. cannot compare with a surgeon . Moreover, for a Civil PE , he is impossible to oversee the whole project without delegation. Unlike surgeon , he is in the ops room all the time and fully aware of the situation. But if something happened badly to the project, the PE has to face the music though may be fault due to his subordinates. So, worth it with peanut pay ?

In response to your comments about PE being paid peanuts and made to shoulder heavy responsibilities, I beg to differ. Your example is skewed towards a one off Nicol Highway incident. But you cannot generalize this incident and deduce that all PEs will be made scapegoats if something happens. Engineering is more than one or two person's efforts and decision. In an established multinational company, nobody makes a decision based on his whims and fancy. There are many systems, policies and various subject matter experts to comply and consult before a decision is arrived. And if some mishaps were to happen, investigation will be carried out. If the mishaps occurred as a result of flaws in systems and not due to negligence or wanton attitude of the employees, the employees will not be taken to task. In other words, it is easier to be an engineer than what most people will think. Coz we do not operate alone. Neither do we sit behind the desk all day long to do lengthy pages of calculations. And regarding the comment that PE are paid peanuts, I am surprised that 10K - 20K/mth is peanuts and butter to you. Based on the singapore labour force wage statistic for all age group, if you earn 10k - 20k/mth, you are already the top 5% earner. While it is little when compared to people like Mr Sim Wong Foo who earns millions of dollars a year, I still think that it is a respectable pay compared to majority of the Singaporean. Maybe you will like to share with us how much you are earning or expect to earn in order to qualify the peanuts comments.

After reading all your comments, I really do feel compelled to chip in my 2 cents worth.

My stand is that Singapore doesn't really pay that well for its engineers and scientists (techies). While I agree that while techies cannot expect hefty bonuses like the bankers (as they are usually not directly involved with sales), too low pay will cause your tech people to worry and be distracted and not focus on the job. Thus the quality of work is likely to deteriorate.

I have a close friend who just completed a PhD in the defence engineering industry. He's starting salary in Singapore is only 5k after slogging so hard, and that is one of the highest around. I have heard horror stories of other companies paying even lower than that. With this kind of mindset from employers, how can Singapore ever encourage its people (who are super practical and kiasu) to ever go into science and engineering?
Compare this to overseas engineering companies in Israel, where the starting pay for an undergrad (yes u-grad) is $6k SGD. Not absolutely fantastic, but good enough. I have also seen adverts for engineering teachers in Dubai with a 200k+ salary tax FREE.

So my advise would be the same as with many others:

Do engineering and get out of Sg. Stay in Sg, get out of engineering.

hi nicholas

agree with your supply & demand theory. oil industry is relatively comfortable now, but when it cannot find the bodies it wants, "foreign talents" will come in. this is like what is seen in other industries eg IT, engineering, banking. not so sure where u will be then.

I have been in Software Engineering for 10+ years and I can tell you that it is a lot of hard work , late nights and below average pay when compared to the people in the financial section. But we had our good days (remember the dotcom bubble), when everybody wants to be in Software (even actresses) and salary was rocketing.

Last few years, globalization has made Software Engineering not so attractive because you have to compete with Engineers from cheaper Asian countries and thus limit your salary. If Singapore engineer pay go up, it has to be justified with higher productivity (which may mean longer working hours) and better innovation (which is easier said than done).

The statements about demand supply is correct, as it more or less sums up the situation I described above. The only silver lining I see is that Singapore has highly motivated and skilled engineers compared to the cheaper Asian countries and many MNCs are aware of that, so they still depend a lot on us to provide their IT solutions.

One question, will the finance and banking industry one day face globalization like IT ? I remember reading that it was already happening with Accounting jobs going to India , but anybody can comment on this?

hi i am gonna be an intern at an oilngas mnc. i think the main reason y banks can pay so much is there r little costs to cover.... as compared to (for oil gas) huge refineries, chemical plants...

their construction, maintenance n operating costs amount to a lot...most engineers r employed in capital-intensive industries... so even sky-high oil prices translate to high profits... they will invest billions into new plants or better technology rather than give out as big fat bonuses or salaries compared to banks.

wat to invest in for banks? higher salaries to attract top talent !

hi Al C

did u advise your fren to go into teaching at uni or polys ? refer to http://www.salary.sg/2007/top-100-jobs-in-singapore-2007/#comment-1821

looks like the ivory towers of cushy academic world is better than the sg engineering industry.