The challenges facing the engineering sector in 2023

After asking Engineers about their careers in our Engineering Survey, we found that these are some of the most pressing challenges engineering businesses will face in 2023.

The gender problem

Despite increased awareness and support for change from companies and organisations throughout the sector, only 8% of our participants were women, proving there is still a lack of gender diversity within engineering.

Research by Engineering UK found that only 25.4% of girls aged 16-18 would consider a career in engineering, compared to 51.9% of boys. But, by the time students reach higher education, women represent just 16% of first-degree students in engineering and technology.

With the shortfall of graduates costing the UK economy an estimated £1.5bn a year, and with the demand for skilled workers predicted to continue to rise, it’s becoming more and more important for companies to increase investment in initiatives that will encourage the next generation of women to pursue a career in engineering.

Recruiting through women’s societies at universities will give firms access to an untapped source of engineering talent, creating the opportunity to increase the number of women in graduate or entry-level positions.

Focus on increasing the number of female engineers

Ensuring inclusivity during the recruitment and selection process will help to attract female candidates while offering development programs for women already working within the company helps to ensure there is a constant supply of qualified candidates for senior positions.

Almost two-thirds of engineers are planning to change roles

This trend is one that seems set to continue as millennials, who stay within a role for an average maximum of 3 years, are expected to make up 50% of the global workforce by 2025.

This increase in younger employees who are more likely to job-hop means that companies will need to work harder to keep hold of talented engineers; offering more competitive packages and employee incentives that will help them stand out from the crowd.

Opportunity, management and company direction

Of the Engineers we surveyed, 25% said that the direction of the company was one of the reasons for them considering leaving their current position, 37% said it was because they were unhappy with management, and 50% said that they had found a better opportunity.

In contrast, only a third of the Engineers surveyed said that compensation was one of their reasons for considering a change of positions, suggesting that salary is not as much of a priority as may be expected.

IR35 changes are having a significant impact

Despite the potential benefits contracting may offer, almost 90% of the Engineers we surveyed were Permanent employees.

With the changes to IR35 back in 2020/2021, many Engineers have found it more difficult to make the transition from contractor to permanent employee and vice versa. This has made it more difficult to find highly skilled workers for important projects and this challenging issue is leading to an increase in contractor rates, permanent salaries and a potentially significant impact on project costs and timelines.

We are also losing Engineers to overseas where pay and tax environments have been more contractor friendly.

Engineers don’t feel valued

Nearly three-quarters of the Engineers we surveyed said that they only felt somewhat, not so, or not at all valued by their employer; and almost two-thirds said that they felt somewhat, not so, or not at all satisfied with their job.

Increasing the level of satisfaction and value employees get from their jobs is going to be paramount for companies wishing to retain top talent as the industry continues to struggle with a shortage of qualified engineers.

Initiatives to increase recognition, feedback and communication will all have a positive impact on employee retention, with studies showing that companies who implement regular employee feedback have turnover rates that are 14.9% lower than for employees who receive no feedback.

Perks don’t have to be material

Families no longer rely on a single source of income, and both parents are often now active in family life, so it’s important for businesses to recognise this within their benefits packages.

While it’s going to be difficult to implement for staff in the more manual roles, offering employees the chance to work flexible hours, or even remotely, could not only encourage more female engineers to the business but could also have a positive impact on employee retention across the board.

With the cost of living crisis, increased interest rates, childcare costs soaring, offering employees greater flexibility about how and where they work can often have the same impact as receiving an increase in salary – at no added cost to employers.

Remove geographical limitations where possible

Finding engineers with a specific skill-set can be tough, so firms should seek to remove geographical limitations where possible, to maximise their chances of finding qualified engineers.

Many roles can now be performed remotely, offering businesses the chance to hire engineers from a wider area, and improving their chances of finding highly skilled workers quickly and effectively.

Open up communication

Even if employees are still office-bound, modern technology can help to create a virtual watercooler that allows for staff to engage more meaningfully than they might currently.

Tools like this can increase the speed and efficiency with which different departments communicate, regardless of their physical location, having the potential to reduce production issues or miscommunications whilst also creating a space to foster the company’s culture.

Emphasise feedback

Improving staff retention and engagement can give HR and Management staff more time to focus on developing existing employees, rather than searching for new ones.

This emphasis on feedback and transparency can help to create a culture which attracts more qualified engineers to open positions, creating a stable pipeline of candidates for the business and reducing the pressure often placed on staff to find candidates quickly.