Instead, high-tech engineers and managers have experienced lower wage growth than their counterparts nationally. The experience premium, which is earnings growth based on years of work, grew substantially for engineers and managers in the U.S. between 1985 and 1995. Today high-tech engineers face a less favorable career outlook than engineers in other industries. This is strong evidence against the existence of a labor shortage. We believe that the large increase in graduate engineering students along with companies' desire to hire engineers with the latest education dampens wage growth for experienced engineers.
Foreign students are an important part of the story.
The data point out two potential education problems. The first is a possible lack of continuing education of experienced engineers. Companies have little incentive to train older engineers because they can hire from the large flow of newly-trained and cheaper engineers. Companies save money on training since the recent graduates already have cutting-edge knowledge. Any decision to increase visas for foreign high-tech workers should be accompanied by the requirement that companies provide training for experienced engineers to ensure that the young engineering graduates are not simply displacing older engineers.