Choosing a good career path isn’t as simple in 2022 as it was just a few years ago. In the post-pandemic world, you’ll have to consider an array of things before you decide which job to pursue. How resilient the industry is, whether the salary meets inflation rates, whether you’ll have job security, and more.
Note that there are never any guarantees that a specific job might be a good choice for you. That said, there’s no denying that some industries and career paths offer more opportunities than others.
An industry full of opportunities and yet often overlooked by young adults and college graduates is the capital goods industry.
As the cornerstone of the global economy, the capital goods sector has proven resilient, lucrative, and agile. But is capital goods a good career path for you?
Take a look below to find out more about this essential industry. Learn whether it offers career paths that suit your skills, interests, and preferences.
What is the capital goods industry?
Capital goods are the products, tools, and machinery used to produce other goods sold directly to the end consumers. They refer to all the equipment and tangible assets that various businesses need for delivering their own products and services. Those tangible assets can include:
The easiest way to understand what the capital goods industry entails is through an example. A clothing company, for instance, produces consumer goods. These are goods that you, as the consumer, can buy, such as jackets, shirts, and trousers. However, producing those goods requires equipment such as industrial sewing machines and vehicles for product distribution.
Those machines and vehicles are considered capital goods. However, even minor equipment necessary for the production of clothing is considered a capital good. That includes sewing needles, packing boxes, pens, shelves for stocking, and more. On the other hand, raw goods, such as textile that becomes part of clothing, are not considered capital goods.
The businesses in charge of manufacturing the machines, tools, and equipment used in production belong to the capital goods industry.
How this industry stands out
Capital goods are one of the essential global industries critical for the survival of every business in existence. However, it simultaneously presents opportunities and obstacles.
Unlike consumer goods that come with an array of price tags, capital goods are usually a significant investment for businesses. The heavy machinery, equipment, and assets a business needs to start operating cost tens of thousands of dollars. This presents a critical barrier to entry.
The good news is that despite their depreciation over time, these capital goods tend to have a long lifespan. That is why they provide an excellent return on investment (ROI).
An increase in capital goods expenditure is most commonly an indicator of healthy economic growth. It is a sign that businesses have enough resources to invest in growth and development. However, it also means that consumers have enough disposable income to invest in consumer goods.
Of course, this works the other way around, as well. A decrease in capital goods expenditure often indicates a recession. It suggests that businesses are fearful of making hefty investments. That is often the case because there is also not enough demand from consumers to offer a positive ROI.
Still, even amid a recession, capital goods tend to remain strong and resilient. In May 2022, for instance, core capital goods orders went up 10.2% on a year-on-year basis. This increase happened despite rising interest rates and post-COVID financial struggles. It shows that those entering the industry can still expect plenty of lucrative career opportunities in spite of global challenges.
What companies are in the capital goods sector?
Though the capital goods sector may seem somewhat obscure to the average end consumer, it’s anything but. Many renowned international companies belong to the capital goods field, including:
- Boeing – one of the largest manufacturers of airplanes, rockets, missiles, satellites, and telecommunication equipment;
- Ford Motors – supplying both consumer and capital goods, Ford Motors is known for designing and manufacturing an array of high-quality vehicles for personal and business use;
- General Electric – the leading energy provider, essential in healthcare, aviation, manufacturing, and other industries;
- Siemens – once best known for producing consumer goods such as Siemens phones, the company is the biggest industrial manufacturer in Europe;
- Caterpillar – known simply as CAT, it’s the biggest manufacturer of construction equipment in the world, delivering everything from heavy-duty machinery to locomotives, diesel and gas engines, and more.
These are just some examples of the most renowned companies in the capital goods field. It is one of the biggest industries in the world, boasting thousands of companies. Some of these offer capital goods for general purposes, and others specialize in manufacturing products for specific industries.
Income in different roles
Here are some of the career paths you could pursue in capital goods:
- Industrial engineer – responsible for organizing workflows, optimizing processes, addressing production issues, and more, industrial engineers earn an average salary of $95,300 a year;
- Industrial designer – responsible for developing concepts for manufactured products, anticipating issues, coming up with solutions, consulting with clients, and more, industrial designers earn an average salary of $77,030 a year;
- Mechanical engineer – responsible for developing, installing, and maintaining machinery and equipment, mechanical engineers earn an average salary of $95,300 a year;
- Quality control inspector – responsible for examining materials and products for defects and ensuring they meet quality standards, running quality tests, and more, quality control inspectors earn an average salary of $38,580 a year;
- Logistician – responsible for planning, organizing, and tracking the movement of products, logisticians earn an average salary of $77,030 a year;
- Assembler – responsible for assembling diverse parts of the machinery and building finished products, assemblers earn an average salary of $37,170 a year;
- Marketing manager – responsible for developing business-to-business (B2B) marketing campaigns, researching target audiences, and more, marketing managers in the capital goods industry earn an average salary of $133,380 a year;
- Warehouse worker – responsible for stocking products and raw materials, packaging them, preparing orders, and more, warehouse workers earn an average salary of $30,320 a year;
- Software developer – responsible for creating charts and algorithms, developing programs, platforms, and apps, fixing glitches, and optimizing software solutions, software developers earn an average salary of $109,020 a year;
- Sales manager – responsible for developing sales plans, setting quotas, training employees, reaching sales targets, and more, sales managers earn an average salary of $127,490 a year.
These are just some of the available roles, and the salaries mentioned are only an average estimation.
As previously mentioned, the capital goods industry tends to be quite resilient. For instance, exports of capital goods in the US exceeded $49.65 billion in September of 2022 alone. The high demand over the past few years has caused a significant expansion of the industry, with expectations that this trend is only bound to continue.
In a nutshell, this means that the overall job outlook in the industry is objectively positive.
Estimates show that approximately 1.3 million people are currently employed in the industry, with their jobs going from assemblers to marketing managers and software developers. With the expected growth of this sector, the number of job openings is set to rise, presenting plenty of employment opportunities to workers of all skill levels.
Pros and cons of working in this field
Though there’s no denying that working in capital goods can be highly lucrative, with plenty of opportunities even for low-skill employees to climb up the ladder, this industry isn’t for everyone.
Here are the main pros and cons of working in the capital goods field.
- Competitive salary;
- Great employee benefits;
- Plenty of entry-level positions;
- Comparatively better job security;
- Opportunities for growth and development;
- Potentially dangerous work environment;
- Physically/mentally difficult work;
- Required technical skills;
- Complicated technology use.
The required education
Considering just how vast the field of capital goods is and how many different career opportunities it presents, there are no set educational requirements for the industry as a whole. It all depends on the specific career you want to pursue.
Working in a warehouse or on the assembly line generally doesn’t come with preset education requirements, though it’s a plus to have at least a high school diploma.
Higher-level jobs with better pay typically come with more stringent education requirements. To become a marketing manager, for instance, or a logistician, you’ll need to have at least a BA in a relevant field.
Software developers, industrial engineers, and industrial designers will usually need an MA or even a Ph.D. in a relevant field.
It’s best to research the specific career you’re interested in to learn more about the education requirements you must meet to find employment in this industry.
As mentioned, there are many entry-level positions in the capital goods sector, so you can easily find employment with no previous experience in a similar field.
However, just as there are varying educational requirements in this sector, there are varying skill requirements.
Warehouse workers and assemblers generally don’t need any specific skill sets as they’ll get all the necessary training during onboarding.
On the other hand, marketing and sales managers, software developers, and logisticians will need at least a few years of experience.
The job applicant application criteria can be stringent for higher-paying positions, but you don’t necessarily have to come fully prepared. If you don’t mind slowly working your way up the ladder, you can start with lower-level positions and climb higher as you gain the necessary skills.
Best companies to work for
As a general rule of thumb, the best companies in the capital goods field to work for are those that have been in the industry for a while. Though there’s no shortage of small businesses in this sector, larger companies whose reputation precedes them tend to offer better job security and more development opportunities.
Thus, some of the best companies to work for include:
- Ford Motors;
- General Electric;
- ABB Limited;
- Honeywell International Inc.;
- Union Pacific;
- Lockheed Martin.
On average, these companies offer competitive salaries, extensive employee benefits, and positive work environments, though experiences might differ depending on the branch and department within them.
What does working in capital goods look like?
As such an essential industry, capital goods can create somewhat stressful work environments. Regardless of your specific role, you can expect to encounter tight deadlines, demanding top management, and dynamic, if not at times chaotic, workplace conditions.
Still, many of those employed in this industry are satisfied with their positions. The capital goods industry offers competitive salaries (see what do capital goods jobs pay) and employee benefits and allows you to enjoy a better work-life balance.
Capital goods is a diverse industry with plenty of employment opportunities. If you have a creative mind, you can find fulfillment by seeking a career path as a designer. If you’re pragmatic, careers in logistics or industrial engineering might suit you perfectly. Whether you’re looking for a challenge or prefer simple, repetitive jobs, want to show off your problem-solving skills, or prefer to follow another’s leadership, you can easily find a position that matches your personality, interests, and skill sets.
Most importantly, you can easily find a position that allows you to grow and develop as you go.
Therefore, to answer the question of whether capital goods is a good career path in 2022 and beyond – yes, absolutely. As long as you’re up to the task, you can enjoy excellent opportunities in the industry.