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Strong engineering links to GDP rise

NCE stock business

Strong engineering correlates to better economic development, according to a new report.

The report published by the Centre for Economics and Business Research (Cebr) has found that there is a strong positive correlation between engineering strength and economic development.

The report has been published to coincide with a global gathering of engineering and international development leaders in London for the Engineering a Better World conference.

The study has brought together analysis and insight from a range of sources to give a picture of global engineering, including its workforce, output, prospective recruits, quality of research and where its impacts are most needed.

The report, which was commissioned by the Royal Academy of Engineering, also unveiled an “Engineering Index”, which has ranked 99 countries by their engineering strength. It found that Sweden, Denmark and the Netherlands topped the list, scoring well due to high employment in engineering, high average engineering wages, and good quality engineering infrastructure.

“This is the first time a global study has looked holistically at the value of engineering and its role in economic development,” said Cebr managing economist David Whitaker.

“Our analysis also shows that a one percentage point increase in a country’s score on the Engineering Index is associated with a 0.85% increase in GDP [gross domestic product] per capita, demonstrating a clear link between economic development and engineering strength.”

It said that the latest data showed that developing economies, including Myanmar, Tunisia and Honduras, led the world in gender parity in engineering, with the highest proportion of female engineering graduates: 65%, 42% and 41% respectively.

This compared to only 22% in the UK (with just over 15,800 female graduates in engineering per year) and Australia and 21% in the Netherlands.

Engineering in the UK

According to the new Engineering Index, the UK ranks 14th partly due to the high annual salary commanded by UK engineers.

It also found that the UK outperformed almost all other nations with the quality of its educational institutions – with nine British university engineering departments making the UK Times Higher Education University Rankings top 100 list. It said that only the US topped the UK in this field, with 31 engineering departments in the top 100, of which four were in the top five.

However, it said that the UK’s percentage of female engineers was far lower than other developed countries, with women only making up a small fraction of the nation’s engineering graduates (22%). This compared to a European average of 28%. Of the 34 European countries considered in the analysis, the UK only ranks 22nd in gender parity.

The size of the engineering workforce in the UK also compared less well to other countries, with latest data indicating that engineers only represented 0.7% of the UK population. This is less than half that of Finland (9th on the Index), where engineers made up 1.7%.

The report said that in the UK, 53% of all engineering employers were currently seeking new recruits with engineering and technology skills, with the highest demand in the construction (67% of employers), electronics (61%) and aerospace (60%) sectors.

Data from the World Bank showed that UK GDP per capita was £27,100 in 2013. However, it said that if the UK ranked first in the Engineering Index, UK GDP per capita would have increased by 10% to £29,900.

Future hotspots: India and Vietnam

The report forecasts that India and Vietnam will be future engineering hotspots, where there will be a large need for and growth in engineering.

India appeared 46th in the Engineering Index, which was a result of the country’s relatively strong performance in gender parity and engineering research. However, this was offset by its relatively low quality of engineering infrastructure.

According to the report, the country is tipped for growth in engineering strength as a result of the significant expansion of its urban population.

It stated that India’s GDP was expected to grow at an average annual rate of 7.4% between 2016 and 2021, in comparison to the Chinese average of 5.3% a year. As a result, it is predicted that India will go through an infrastructure and construction boom which will continue for the next two decades and demand for engineering expertise and workers will rise in line with this boom.

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