Mastering Engineering Economics: Your Path to Career Success

Engineering is a fiercely competitive and highly rewarding field, but how does engineering economics play into this and why is it important for students and recent graduates to fully understand this practical and performance-enhancing skill? 

March 2, 2024 by Kazu Fujimoto

What Is Economic Engineering?

If your aim is to eventually secure a job in the field of engineering, there’s an invaluable asset you should be aware of—engineering economics. 

This discipline, often referred to as economic engineering or engineering economy, is your secret weapon for career success.

Economic engineering is a branch of economics, specifically microeconomics, that holds the key to making intelligent decisions that can set you apart from the competition. It’s all about applying economic principles to engineering projects for maximum efficiency.

Why Is Engineering Economics Important?

Economic engineering can be the difference between a successful and a failed project. To succeed a project must be technically doable but also financially possible. If a project doesn’t make any economic sense, it may be a waste of time and resources.

Engineering economics isn’t just a theory, it’s a practical skill that can help you to stand out in a field of applicants. It supports data-based decision making that businesses and hiring managers find invaluable.

The central focus for any business is to remain profitable. Engineering economics have a direct financial impact on a business.

SMART Engineering Economics

Due to its influence on a businesses financial performance, engineering economics and economic goals should be SMART.

SPECIFIC

MEASURABLE

ACHIEVABLE

RELEVANT

TIME-BOUND

These parameters help to create attainable and strategic goals that properly align with the businesses wider vision. They provide you with quantitative information to back decisions. 

You should highlight quantitative skills on your resume.

Applying Engineering Economics To Civil Engineering

Imagine you’re a Civil Engineer looking to secure a highly competitive job with a prestigious construction firm. During your interview, the hiring manager presents you with a complex project—a new highway construction. They want to know how you would approach the project from an Engineering Economics perspective.

Cost-Benefit Analysis

For Government projects, it might be less about profit and more about benefits. It can be a good idea to begin with a thorough cost-benefit analysis. You could weigh the costs of materials, labour, and equipment against the expected benefits.

• How much will the project improve transportation efficiency and reduce travel times? 
• Does this make for a positive investment in terms of investment vs. return? 
• What specifically makes this an attractive investment compared to other projects?

Life Cycle Cost Analysis

Next, you might delve into a life cycle cost analysis, or even an annual cost analysis. This will help you to further examine the project’s long-term costs for the business. This can include costs like maintenance, repairs and even future expansions.

This can provide an opportunity to highlight where quality in both the short and long term can be valuable. It’s important to show your ability to think ahead and examine the bigger picture when it comes to tackling a project.

Risk Assessment

A risk assessment is key to identifying and planning for any issues that might occur during a project, whether in engineering or any other field. 

Looking at potential risks and their subsequent financial implication is a proactive approach that highlights awareness of financial setbacks and emphasises your ability to navigate complex situations and plan for uncertainty.

Financing Options

There are lots of different funding options available for businesses. During an interview it can be wise to show your awareness of how different options like grants or private investment might influence the project.

It can also be important to highlight how engineering economics might make a project feasible and attract further investment.

Sustainability and Environmental Impact

Engineering economics can include evaluating environmentally conscious strategies and materials that offer both environmental and financial benefits for businesses.

Approaching sustainability from an economic angle often involves examining the financial consequences of decisions that are more (or less) sustainable. This is then examined from a cost-benefits perspective to determine the best strategy.

The Time Value Of Money

At the heart of engineering economics, there is an idea called  the “time value of money.” 

This concept simply means that money’s worth changes over time. It essentially recognises that a dollar today isn’t the same as a dollar in the future. For engineers, this helps to ensure smart money-related choices. 

It may be important to consider things like interest rates, rising prices, and what losses might occur when money is used for one thing instead of another. This way, you can analyse which decisions make the most financial sense, and whether it’s worth investing in the project or allocating funds elsewhere.

Why Is Engineering Economics Important For Students And Graduates?

For students and recent graduates, building job-specific skills is incredibly important. When you apply for your first engineering position, you will likely have very little practical experience unless you’ve taken on an engineering internship, research position, or placement previously. 

Engineering economics can help you to evidence how your developed skills can immediately impact the workplace, and this can set you apart from other applicants.

Evidencing how your actions will financially impact a project is a valuable and essential skill in engineering.

How To Showcase Engineering Economics On Your Resume

Businesses are looking for candidates that make informed and financially aware decisions in their job role. It’s always beneficial to prove that you are aligned with the business’s vision both financially and in terms of quality from the very beginning. Your resume is a good opportunity to do this.

Graduates can create a dedicated section highlighting relevant skills for recruiters and hiring managers. For example, Engineering Economics, Cost Analysis, and Financial Decision-Making might be very valuable skills worthy of inclusion in your resume or cover letter.  

It’s also important to evidence measurable successes where possible, and engineering economics provides the perfect opportunity.

Secure A Role With Engineering Economics

Do you need help to secure your first engineering role? Resume rewrites, interview practice and carefully constructed cover letters can 10x your chance of landing that dream job. Learn more.