Auto companies scramble for engineers
Quest for scarce talent sends salaries climbing
Photo credit: @TIF PHOTOGRAPHIC LLC, EDWARD LLEWELLYN OCHAL
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If you know an engineer looking for a new job, supplier Freudenberg-NOK wants to talk to you.
To recruit employees, the suburban Detroit supplier of engine and other seals is offering $2,000 to anyone who refers a job candidate who is eventually hired. The program, launched in January 2011, is one of several steps Freudenberg-NOK has taken to attract new talent.
As the auto industry rebounds, automakers and suppliers are competing for engineering talent, sending salaries climbing. Companies are heavily recruiting newly graduated engineers and mid-career engineers to fill vacancies as they ramp up production, but some engineers still find the automotive sector less attractive than other industries because of the recent tumult.
"There's a real competition going on out there because many of us are coming back from the lower volumes of 2008 and 2009, and we all need talent," said Sarah O'Hare, Freudenberg-NOK vice president of human resources.
"Not only is it tight, but when there is someone, they may have multiple offers," she said.
New connections
Many companies offer referral payments to employees, but O'Hare said she is unaware of any others that pay outsiders for referrals.
Freudenberg-NOK has received 50 external referrals, she said, but has not hired any of the candidates.
"We want to have a readily available networking base," O'Hare said. "So for us it's been modestly successful in that regard because we now have 50 new connections that we can reach out to."
With annual revenue close to $1 billion and more than 4,200 employees globally, Freudenberg-NOK filled 150 jobs last year and has about 40 openings, O'Hare said.
Nearly every auto-related company faces similar headaches. International Automotive Components Group held a job fair at its North American headquarters in suburban Detroit last month and was looking to fill "a few dozen" positions, spokesman David Ladd said.
Ladd said IAC, which specializes in manufacturing interior parts, needs newly graduated and experienced mechanical, electrical and chemical engineers.
"The industry is coming back in quite a healthy fashion, and we're part of that growth and are now having to staff up to support that growth," Ladd said. "It's not growth that's on us right now or next week, it's growth that's on us over the next couple of years."
IAC Group North America ranks No. 23 on the Automotive News list of the top 100 suppliers to North America with $2.3 billion in parts sales to automakers in 2011.
Looking elsewhere
Automotive companies are being forced to look outside traditional recruiting avenues to attract new engineering talent and compete with other industries.
"It requires that others, not only us, expand the scope of the search," Ladd said. "You need to look in other parts of the country where engineers are gainfully employed in other industries."
To compete with other industries, suppliers and automakers are paying more, said Bob Millman, founder of AutoPro Technical Recruiting, a suburban Detroit automotive recruiting company.
Experienced engineers can fetch more than $90,000 annually these days, up from pre-recession salaries of near $70,000, Millman said.
Similarly, Millman estimated that before the recession new engineers made $40,000 to $45,000 annually. Today, recent graduates can make as much as $55,000 in automotive engineering jobs, he said.
Because of the dearth of qualified engineers, automakers and suppliers are swarming college campuses to fill vacancies.
Recruiting on campus
Career counselors at several universities across the country said they have seen a significant increase in recruiting by auto companies in the past year or two.
At Michigan Technological University, about 90 percent of graduating students get jobs, Jim Turnquist, director of the university's office of career services, said.
Turnquist said companies from an array of industries -- from energy and utilities to consulting -- are competing to hire students from Michigan Tech, which is in the state's Upper Peninsula and has more than 5,000 undergraduate students.
Turnquist said 8 or 9 percent of Michigan Tech graduates go to work in the automotive sector. Before the recession, about 30 or 40 percent of students went to work for one of the automakers or suppliers, but now they are more hesitant to join companies that struggled so mightily only a few years ago.
"There's a little reluctance there, but they're still going with the automotive industry," Turnquist said. "But not at the same level they have done in the past."
You can reach Joseph Lichterman at jlichterman@crain.com.
