As an engineer (20 yrs)and engineering manager for 8 yrs, I have never been unemployed and my job has never been outsourced. This is also the case for 6 other engineers across two generations in my family.
In my opinion, the IT industry is the one that is usually held up as the example of outsourcing and is not representative of other engineering careers available.
I am not claiming that my experience is representative of the entire country or all industries. I am just giving my personal perspective.
Until a few years ago, it was a good degree and a good career. But somebody starting out now has major disadvantages that either did not exist or were much less prevalent twenty or thirty years ago: legitimate resumes from around the world, rampant H1-B abuse at wholesale levels, and computerized resume scanning that looks only for the buzzwords of the week are just what come to mind immediately.
What type of engineering are you involved in? (Obviously there's an opportunity for me to start a new division in India or Latin America!)
I am acquainted with about 20 mechanical and electrical engineers (masters / graduate level) from the University of Southern California in Los Angeles, all of them having graduated in May, 2011. Not one of them is unemployed today. Every single one of them has got a job paying over 68,000 dollars annually, as starting pay, with most of them getting between 75,000 and 94,000 dollars, annually.
Whoever claims engineering is dead simply does not have a grasp on reality.