A master’s degree in petroleum engineering is among the highest-paying master’s degrees, with both median and mean salaries in the six-figure range. Although you’re virtually sure to earn a good income when you work as a petroleum engineer, there is a range of wages that would be considered fair. Aside from your level of seniority and amount of work experience, factors like the industry you work for and the state in which you’re employed have an impact on how much money you should expect to earn as a petroleum engineer.
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Looking at Mean and Median Wages for Petroleum Engineers
In 2020, the United States Bureau of Labor Statistics (BLS) reported a median annual wage of $137,330 and a mean wage of $154,330 for the petroleum engineer occupation. The big discrepancy – $17,000 – between these numbers is due to how they are calculated.
The mean is the average salary that you get when you add together all of the annual salaries of petroleum engineers and divide it by the total number of petroleum engineers in the U.S. The median is the midpoint salary. What a pattern like this means, according to Salary.com, is that a smaller amount of high-earning workers at the top of the salary range make considerably more than others in the field, positively skewing the distribution. According to the BLS, petroleum engineers who currently earn less than $78,620 per year are in the lowest-earning 10 percent of the profession. Those who make upwards of $208,000 fit into the highest-earning 10 percent of petroleum engineers.
These figures represent the field as a whole, but you can also look at salary ranges in terms of industry of employment. Among the top five industries that employ petroleum engineers, management of companies and enterprises pays the most, with a $167,780 median wage, the BLS reported. This industry accounts for 18 percent of the field.
Next most lucrative is the engineering services industry, which pays a median salary of $155,430 to the 7 percent of the occupation it employs. The median salary for the oil and gas extraction industry, which employs 34 percent of petroleum engineers, is very close to the overall median wage for the occupation, at $137,530. Petroleum and coal products manufacturing pays a $131,260 median salary and accounts for 7 percent of the workforce.
The top employment industry that pays the least, according to the BLS, is support activities for mining. The 14 percent of the petroleum engineering occupation that works in this industry makes a median wage of $108,190.
The Highest-Paying States for Petroleum Engineers
A major factor in earning potential for petroleum engineers is location. You might think that the differences in petroleum engineer salaries by state would be dependent on supply and demand, with the highest-paying states being either those with few petroleum engineers or those with many. However, among the top five highest-paying states for this occupation, some have only a small amount of petroleum engineers, while one accounts for around half of the occupation.
Petroleum engineers earn the most in New Jersey, where the mean annual wage for the 170 professionals working in this field is $184,560. Next is Texas, where the 15,090 petroleum engineers earn an average wage of $169,760. Petroleum engineers in Florida earn a mean salary of $160,710, closely followed by those in Colorado, where the average wage for the position is $160,150. Oklahoma rounds out the top five most lucrative states for petroleum engineers, with a mean salary of $156,390.
Beyond industry and location, there are other factors that impact earning potential for petroleum engineers – and some that don’t. Certification and licensure can make you stand out to employers and give you more bargaining power, while the BLS notes that a master’s degree doesn’t translate to a large wage premium for petroleum engineers. In fact, petroleum engineers – along with mining engineers and geological engineers – report a median salary that is 7 percent less than their colleagues without a degree.
This doesn’t necessarily mean that earning a master’s degree in petroleum engineering is a bad idea. It’s not as though your employer will cut your salary because you earned a graduate degree. Keep in mind that some petroleum engineers with a master’s degree go on to work in academia and academic research or to advance to engineering management roles.
Unlike many other fields of engineering, including civil, chemical and mechanical engineering, work in petroleum engineering is highly concentrated in areas with access to oil and gas. In areas without these resources, you may have trouble finding a job in this field.