This is something I have also struggled with, as someone who is currently in the Industry and also working towards a Master’s Degree (MS) in Biomedical Engineering. Specifically, I am working as a Co-op, which is allowing me to gain Industry experience while alsoing progress towards a higher level degree. I feel like a Bachelor’s Degree will allow you to be considered for an entry-level job but I do not feel it does much more than that. Even after my first couple of graduate courses I realized the immense advantage I was gaining from them. It was the first time I felt I was gaining any real applicable knowledge. These are skills the engineers I work with already possess, so this allows me to take a sort of shortcut to make up for as much as several years of working experience in certain aspects.
Also, I can tell you from the maybe 20 different engineers I work with, probably half of them are either working towards or already have an advanced degree, whether it be in some type of Business or Management or Engineering. I feel it is an evolving standard because more and more people are going to college in the first place, so there will be more qualified candidates for any particular opening. That advanced degree distinguishes you from the pool of applicants.
As far as a PhD is concerned, I do not know much of the advantage of that other than being able to teach at the highest level. From my classes at NJIT I noticed that most, if not all, of my engineering professors had PhDs. I hope this does not prevent me from perhaps teaching towards the end of my career, but it is an interesting trend. Perhaps an MS degree and a history of accomplishment in Industry would substitute for that, but who knows?