I think I can speak for all of us when I say a big, sarcastic, "thanks a lot!" to Enron, Arthur Andersen and WorldCom. (Are we forgetting anyone? Surely by press time the list will be longer.) Just when the ailing U.S. economy had carefully crept out of its sick bed, still fragile and skittish, these companies came on the scene with overcooked books and sent the stock market and consumer confidence into a nosedive. By mid July it looked like the recession was back on.
What happens during a recession? Companies lose money and people lose jobs. Planned purchases for luxury items get put on hold. And while most Americans families view a car as a necessity, not a luxury, that second car they were thinking about buying is something to wait on during a shaky economic period. And for others, particularly those living in urban areas with easy public transportation, having even one car might be an idea that will have to wait.
So that means the automotive industry overall takes a hit. The question is, does it still have room for you?
In the first half of 2002, the automotive industry reported 78,346 job cuts. But don't despair; that number is almost 10,000 less than last June's total, even after the tragic events of September 11 and the stock market crisis.
Huei Peng, Ph.D., director of the automotive engineering program at the University of Michigan, isn't too worried. "This industry is particularly cyclic. Year to year, total employment can change by 10 to 20%, but automotive will always be a significant part of the U.S. manufacturing industry."
"The market has been so strong for so long - 10 years or so-that we almost forgot that it is cyclical," says Michelle Guswiler, director of cycle planning and product strategy at Ford Motor Company. "In fact, much of the current work force has never been through a downturn like this."
That's the key: The industry slump is unfamiliar to a lot of the work force, but it's not unfamiliar to the industry itself. In fact, the current slump is not even all that desperate. Guswiler's assessment is that it's not really any worse than past downturns. And the big companies may be getting better at managing these slumps.
"Through the last couple of downturns, original equipment manufacturers (OEMs) have taken a different approach with respect to working through difficult economic cycles," says Ron Rygiel, former project engineer at (then) Chrysler Corporation and now an automotive market manager at Lombard, Ill.-based Cinch Connectors, a supplier of electrical connectors to manufacturers. "OEMs used to move with the economy. In lean years they would place less emphasis on product development, but more recently, companies are continuing to develop new products in order to differentiate their brands."
"The lifeblood of a company is their product," Guswiler agrees, "so engineers are more protected. I think marketing, human resource and finance professionals are bearing more of the burden in terms of staff cutbacks."
And even more notably in light of the stumbling economy, automotive companies are not cutting salaries as much as some other employers. While the National Association of Colleges and Employers (NACE) is reporting that 2002 salary offers in many field are significantly lower than they were just one year ago, Peng notes that, "Ford and GM are our top two recruiters [at Michigan] and, in our experience, most salary offers are the same or only slightly less than last year's."
Increased Technology = More Work for You
Historically, the auto industry has relied most heavily on mechanical, electrical/electronic and manufacturing engineers, in varying order depending on current trends. "A combined background is very desirable," notes Bob Feldmaier, director of body engineering at DaimlerChrysler.
"Electrical engineering is probably poised for the most growth in the auto industry," says Rygiel. "It's one of the highest growth areas in the industry because it plays a big part in differentiating vehicles from various companies."
And electronic safety is the focus of a lot of current development projects. According to Guswiler, the question is, "What technological features can we add to make the time people spend in their vehicle more productive, efficient and safe?"
The answers are varied, but a lot of them have to do with communications and entertainment. Making mobile phones safer to use in traffic is a top priority. Voice navigation and global positioning systems are also hot. And companies are even working on collision avoidance systems that actually alert drivers to potential obstacles near their vehicle.
And this increasing technology knows no bounds. What if you could speak your email messages into a receiver on your car dashboard that transcribes and sends the message? Backseat TV/DVD units are big now, but what if parents could instead download movies from a satellite? Other trends include fuel-cell efficiency, diesel fuel, alt fuels, hybrid engines, continuously variable transmission, variable compression and variable valve-timing. Developments in these areas are going to need a lot of mechanical and electrical engineers but "regulatory demands for fuel-cell and emissions standards might significantly increase opportunities for chemical engineers as well," says Peng.
What to Bring Beside Your Toolbox
Currently, we're near the bottom of an economic cycle in this industry," says Feldmaier, "but there are still opportunities available." However, there might not be quite as many job openings as there are eager graduates looking for work. If you want to beat out the competition, you have to start making yourself irresistible to potential employers before you even leave school.
"Communication skills are absolutely key," advises Peng. Getting as much communication experience as possible during college can help set you apart from other applicants. To that end, Michigan engineering students are required to take two courses in technical communications, which are co-taught by literature professors.
It's also important to be able to work as part of a team. "Very few organizations have dictatorial work environments," says Guswiler, "so being effective in a team environment is an absolute must. You might be personally responsible for getting people with conflicting goals to work together in the same direction."
And, of course, tried-and-true work experience never hurts either. "Try
to get involved in real-world projects while you're still in school,"
advises Rygiel. "The Society of Automotive Engineers, for example,
sponsors several competitions like Mini-Baja and Formula SAE. It's a way
to apply classroom learning to real-world problems like cost, time, manufacturing
capabilities and even some unexpected issues."
Feldmaier adds, "Get involved in student organizations to show your leadership skills." Try SAE, both Guwiler and Rygiel recommend, which has more than 380 student chapters and 15,000 student members at colleges worldwide.
Keep in mind, once you actually land a position at an automotive company, it's imperative that you continue to distinguish yourself. To that end, many new employees participate in programs for recent hires. The big three-Ford, DaimlerChrysler and General Motors-all have such programs, which are designed to groom the best and the brightest new employees for upper management positions.
Where the Jobs Are
"Graduates seeking a job in the U.S. auto industry can anticipate spending as least some of their career, if not the majority of it, in Detroit," says Rygiel.
Peng agrees, sort of: "I believe the Midwest will remain the heart of the industry, but that is lessening somewhat. The Southeast and Mexico are getting more automotive design centers because of tax incentives, more affordable land and slightly lower labor costs."
Of course, if your goal is to work at the assembly end of automotive development, you could work anywhere. As Feldmaier notes, "It depends on what interests you. If you're interested in manufacturing, you could end up anywhere." Even overseas. "The auto industry is one of the most global industries," says Guswiler. "Markets are emerging in Asia, especially China, as ever-increasing global competition is driving work to lower-cost regions of the world."
Peng advises that those looking to get into the field be prepared to move around, nationally and internationally if the need arises, but he adds that it is possible to make a career in one location. "It's not uncommon to stay in one place, but you might have to change companies to do it," he says. "And I know many people who moved to Japan or Germany for one- or two-year stints and then come home."
To Degree or Not to Degree?
Whether or not to go straight to graduate school after receiving a bachelor's degree is a dilemma for many students, and there are pros and cons to either decision. Feldmaier, however, advises that students go back to school right away. "A master's degree is becoming increasingly important," he says. Peng agrees: "A master's is essential if you want to work on something interesting and exciting, beyond the technical things like drafting."
While admitting that there will always be a need for employees with the solid technical expertise a master's provides, Guswiler recommends you consider an MBA instead. "Depending on your career goals, you may need to understand the whole business equation," she says. "You may have to take complicated cross-functional issues and pull them together, and that kind of skill isn't taught in most engineering programs."
As for pursuing a Ph.D., however, it probably won't be necessary. There are jobs that require it, particularly in research and development, but those jobs are still few and far between. Although, "Ph.D.s do command a higher salary," says Peng. NACE reports that the average annual starting salary for a 2001-02 mechanical engineering graduate with a bachelor's degree was $48,000; with a master's degree, $55,000; and with a doctorate, $62,800.