6 Factors Affecting Engineering Manager Salary

Engineering Manager Salary: Indeed, engineering managers are leaders who steer technical teams to innovativeness and operational success. Therefore, the need for tech leadership is constantly on the rise, making the activities of engineering managers the more essential event for this day and age. Estimated data from the U.S. Bureau of Labor Statistics shows that from 2023 to 2033, the employment of engineering managers is expected to increase by 6 percent, meaning sustained need in the field exists.

In this blog, we are going to explore the factors that influence engineering manager salary: where you work, the amount of experience you have, the demand for such skills, and more. So, if you’re considering a career as an engineering manager or looking to negotiate the salary, it will do you good to read it.

Who is an Engineering Manager?

The engineering manager is placed between technical teams and executive management, focusing on leading and mentoring engineers, managing resources, overseeing the execution of projects, and ensuring that all technical solutions align with the company’s overall purposes. Other than technical skills, an engineering manager should also possess great leadership, communication skills, and problem-solving abilities.

The main duties of an engineering manager include:

• It entails all activities in overseeing product development and engineering processes.
• Team management: Hiring through performance management of engineers
• It entails working together with a cross-functional team, including product, design, and sales teams, to meet respective business goals
• They included developing and maintaining budgets and timelines for projects.

Average Engineering Manager Salary in the US

Engineering manager salary in the US vary widely and are varied by company, location, and experience level. As per the latest data on average, the US engineering manager’s salaries range between $213,000 and $316,000 annually.

Salaries vary pretty wildly across the top tech companies:

These figures are generally inclusive of base pay, bonuses, and stock options, mainly in high-tech corporations. More experienced or skilled engineering managers will bring home the highest dollar at the top end of these ranges.

Factors Affecting the Engineering Manager Salary

Factors that influence an engineering manager salary include market demand, location, experience, and more. Below we break down these factors in detail.

1. Location

Location is the other powerful influencer of an engineering manager salary. The cost of living differs significantly from location to location and follows the demand for engineering skills in that location. For example, due to the price level in such cities, salary offers are higher in tech hubs like San Francisco or New York.

Following is the table with salary levels of engineering managers across various US cities:

Some states, like California and New York, have much higher average salaries for engineering managers compared to others, such as Texas or Florida.

2. Demand and Supply

The balance between the demand for engineering managers and the supply of qualified candidates also plays a role in salary determination. In areas where demand for technical leadership outpaces supply, companies offer higher salaries to attract and retain top talent.

For instance, industries experiencing rapid growth, like artificial intelligence (AI) or cloud computing, often offer higher compensation packages to engineering managers with specialized skills. If the demand for a specific technology skill set increases, companies are willing to pay a premium for managers who can lead teams in that field.

For example, AWS cloud engineers make an average of about $169,000 a year, Google Cloud engineers generate median salaries of $236,000, which is very competitive again.

3. Experience

Experience level significantly affects an engineering manager salary. Entry-level engineering managers with less than five years of experience tend to earn lower salaries than those with over a decade of experience. The more complex and impactful the projects they’ve managed, the higher their earning potential.

For example, an engineering manager with 5–9 years of experience may earn around $130,000, while someone with over 15 years of experience could command upwards of $200,000 or more, particularly in high-demand industries. Look at the table below to find the difference in engineering manager salary based on experience

Also read: Top 5 Factors Affecting Product Marketing Manager Salary

4. Skills and Certifications

The specific skills and certifications that an engineering manager holds can have a profound impact on their salary. Managers who possess expertise in cutting-edge technologies or hold advanced certifications, such as PMP (Project Management Professional) or Six Sigma, often command higher engineering manager salary than those without these credentials.

For example, an engineering manager who is certified in Agile or Scrum Master methodologies can lead software development teams more effectively, and employers often reward these specialized skills with higher pay.

Real-life facts are listed below:

1. Project Management Professional (PMP): As a certification, this credential can hike the average salary of engineering managers by 22%. Project managers with a PMP credential earn between $115,000 and $145,000 annually. It demonstrates knowledge and skills in managing projects in defined scope, time, and budget.
2. Six Sigma: Carrying a certificate of Six Sigma Black Belt, the remuneration for quality management rises from $90,000 to $150,000. Those people playing the role of Green Belts – those who ensure process improvement and statistical analysis an average salary amounting to $70,000-$110,000.
3. Agile/Scrum Master Certifications: The current demand for technology and development includes managers accredited in Agile methodologies or Scrum Masters. Leading software teams using Agile frameworks, experts in this area can expect to make anywhere between $90,000-$130,00

According to a report from Randstad, some key skills that can impact salary include:

1. Project Management Professional (PMP): As a certification, this credential can hike the average salary of engineering managers by 22%. Project managers with a PMP credential earn between $115,000 and $145,000 annually. It demonstrates knowledge and skills in managing projects in defined scope, time, and budget.
2. Six Sigma: Carrying a certificate of Six Sigma Black Belt, the remuneration for quality management rises from $90,000 to $150,000. Those people playing the role of Green Belts – those who ensure process improvement and statistical analysis an average salary amounting to $70,000-$110,000.
3. Agile/Scrum Master Certifications: The current demand for technology and development includes managers accredited in Agile methodologies or Scrum Masters. Leading software teams using Agile frameworks, experts in this area can expect to make anywhere between $90,000-$130,000

Also Read: Project Manager Interview Questions

5. Negotiating Salaries and Benefits

Negotiation can drive up the engineering manager salary very significantly. Indeed, most tech companies allow negotiation of salary, certainly for large corporations, such as Apple, Google, and Meta. Now comes the part when knowing market value plays in.

For instance, an engineering manager at Apple gets the following package:

Source: The Salary Negotiator

The compensation packages offered by Apple include generous stock options and performance bonuses. A smart negotiator can command far more handsome compensation packages, including bonuses and options besides added benefits. Negotiation skills can make you not only improve the base salary but also negotiate for a signing bonus, great health benefits, remote work options, etc.

Negotiation particularly becomes a critical factor in this transition when changing roles from an individual contributor role to that of a manager. Engineers tend to dramatically undervalue their worth once they become managers, and thus powerful negotiation is usually a prerequisite for reflecting the value they are worth.

6. Market Conditions

The overall state of the economy and market conditions can influence an engineering manager salary. In periods of economic growth, companies tend to increase hiring and offer higher salaries to attract top talent. On the other hand, during economic downturns or recessions, hiring may slow, and salary increases might stagnate.

Technology sectors that are booming, such as cloud services or cybersecurity, are willing to pay top dollar for experienced engineering managers. Conversely, if market conditions are less favorable for a particular industry, salary growth may be more modest.

An engineering manager salary is influenced by a wide range of factors, including location, experience, demand, and market conditions. Whether you’re an aspiring engineering manager or currently in the role, understanding these factors can help you navigate your career trajectory and ensure you’re compensated fairly for your expertise.

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FAQs: Engineering Manager Salary

Q1. How much does an engineering manager make at Google?

Engineering managers at Google fall in the bracket of $200,000 to $220,000 per annum, including all bonuses and stock options.

Q2. Does location affect how much an engineering manager will make?

Yes, this is very dependent on location. Cities with a high cost of living, like San Francisco or New York, have salaries that are considerably higher in comparison with other cities in the country with a lower cost of living.

Q3. How crucial to an engineering manager’s salary are an individual’s skills and certifications?

Skills and certifications, such as PMP, Six Sigma, and Agile methodologies make the managerial role of an engineer lucrative.

Q4. How much does an entry-level engineering manager make in terms of salary average?

In general, the average salary of an entry-level engineering manager is between $100,000 and $130,000 per year, based on industry and location.

Q5. How does the engineering manager’s salary fluctuate concerning market conditions?

Salaries for engineering managers inflate in hot tech sectors, as firms vie for the best talent. When times are poor, salaries stagnate or fall.

Related Reads: 

1. How to Crack Engineering Manager Interview Questions at FAANG+ Companies
2. Google Engineering Manager Interview Process
3. Facebook Engineering Manager Interview Process
4. How to Prepare for Your Google Engineering Manager Interview?
5. How to Prepare for Facebook Engineering Manager Interview: Skills Needed, Interview Questions, and Prep Tips