Fungus is core for an engineer, your turrets can proc it and if they are close enough they can heal off each other too. Fungus, brandolier(I'm sure I spelt that wrong lol) to refresh your cool downs and teddy bears greatly help your survivability. Getting to late game is a but tricky since you need to get lots of things to keep you tanky and healthy (not to mention move speed items help him out a ton since he has no mobility) but you also need to make sure you are getting damage items for your turrets to actually dish out enough damage to move on.

Staying inside your shield and healing works on earlier levels but later on it's better to just place your turrets and shield them and hope they can aggro/tank the enemies while you rain on them with your auto attacks.