Workers everywhere are on pins and needles searching for signs of an economic downturn, but instead of just waiting for the other shoe to drop, now is the time to recession-proof your career by building a relationship with a recruiter. This is especially true for engineers who have the expertise necessary to seamlessly transition from a hard hit industry to one that thrives during a slowdown. If you’ve got the talent, then with the help of a recruiter, you can leverage your skills to land a new position if the economy starts to drag. Even if your job is currently well secured, it's still a good idea to develop a rapport with a talent recruiter.
The end of the Great Recession saw the manufacturing sector reverse its decades-long decline in employment growth thanks to Millennial smart collar workers who are good with their hands and equipped with engineering degrees. Talent flocked to space tourism ventures shooting for the stars like SpaceX and Blue Origin, and automotive companies redefining the driving experience like Tesla. The wage premium commanded by manufacturing workers picked up for the first time in years, making the reinvigorated sector even more attractive. But 2019 has seen some troubling trends that signal trying times may be ahead for the economy.
Layoff – a word that’s tough to read and an even more difficult experience to live through. The unemployment rate in the US (3.7% as of August) is currently near all-time lows, but layoffs are creeping across the economy, especially in manufacturing. Bloomberg reports that President Trump’s trade wars are causing factories in Industrial America to cut costs, slash production, reduce hiring, furlough workers, and eliminate jobs.
“Almost all of the gains in manufacturing employment came in the first two years of Trump’s presidency, and things have gone into reverse in swing states like Pennsylvania, which lost more than 8,000 manufacturing jobs in the first seven months of this year.” – Bloomberg.
Outplacement firm Challenger, Gray & Christmas reports that layoffs are on the rise, with companies announcing 46% more layoffs last May than the previous month. And job losses aren’t only limited to equipment manufacturers along the Rust Belt. At the beginning of the year, Elon Musk’s SoCal-based rocket company SpaceX announced it was decimating its workforce, letting go 10% of its employees or 577 positions. In another cost-cutting move, Musk laid off more than 1000 Tesla workers. Aerospace firm Vector Launch raised more than $100 million to blast launch vehicles into space, but in August, its 150 employees were shocked to discover they were suddenly out of a job due to a “significant change in financing.” Vector joined fellow space tourism companies Virgin Galactic, The Spaceship Company and Stratolaunch in enacting downsizing measures. And just recently, Uber, after already eliminating 400 marketing roles, announced it would lay off 435 people across its engineering and product teams as well.
There is much debate as to whether or not the US is falling into an inevitable recession, defined as two consecutive quarters of negative economic growth. But as the recent high-profile announcements reveal, the country doesn’t need to enter an official recession for companies to make proactive layoffs in order to sure up their bottom lines. Manufacturing is particularly sensitive to economic slowdowns and companies in the sector have demonstrated they won’t think twice about axing jobs. Still, engineers working in the sector often discover they can find success and stability by using their skills in a related, but recession-proof, field.
Recession-proof is often used to describe jobs that are little affected by a broad economic downturn, although recession-resistant is probably a more accurate term. Financial analysts point to aerospace & defense companies (think fighter jets not spaceships) as being “least sensitive to US and global economic growth across industrial subsectors.” In 2017, US aerospace & defense was the top net exporting industry, generating a net trade surplus of $86 billion. The US has continued to direct funds toward defense during the trade war, spending $649 billion in 2018 on its military. Defense spending doesn’t follow the market, and there is hardly ever any political appetite to slash defense budgets even during recessions. This makes engineering roles at defense contractors a bit more secure than at similar private companies that don’t rely on huge government contracts.
Aerospace & defense isn’t the only recession-proof industry for engineers. Utilities have always been seen as more or less insulated from economic slowdowns. Electricity demand remains relatively consistent no matter the business climate. Even if people have to delay other payments, they tend to pay their power bill. This is good news for electrical engineers, power systems engineers, and other professionals who know their way around a grid.
And especially during a recession, businesses are forecasted to turn to AI and automation to rein in labor costs. Companies are expected to invest in everything from floor-cleaning robots to self-driving food delivery vehicles and cashierless technologies in a bid to keep expenses low. This presents opportunities for mechanical engineers and automation engineers who will be needed to develop, build, and maintain these advanced robotics.
Career positions open and close in the best of times and the worst. Even if you’re currently not seeking new job opportunities, it’s still recommended to establish a relationship with a recruiter who can help you navigate possible changes in your career that may occur one, two, or even five years in the future. Recruiters are also uniquely equipped to help engineers transition from one field to another. They are advocates who take the time to understand your skills, pitch them to companies and land you interviews so that you can share your capabilities and accomplishments. And if you want to stay in your current field but move to a new organization, they can get your foot in the door. Plus, recruiters are paid by the hiring companies so you, the talent, never have to worry about reaching into your own pockets.
No one knows for sure whether an economic contraction is coming, but you can prepare yourself for whatever the future may bring by connecting with a talent recruiter.
If you’re a top-tier engineer looking to secure your career or grow your job skills then you’ve come to the right place. Sign up for your (always) free Cluster account. It only takes minutes, and one of our recruiters will get to know you in a business day.
A bi-weekly roundup of the latest happenings in industrial tech, hiring and the future of work.