Every engineer worth their salt should use dual monitor setup for work. Period. Want to get more done, faster? Two monitors on your desktop is the cheapest and easiest way to do that. Research shows that extra screen increases productivity by 20-30 percent. Doesn't matter if you're output is 3D models, 2D drawings, spreadsheets, or vaporized aliens on the weekend gaming spree.
Go to any CAD software / engineering / manufacturing trade show these days and you'll see setups like those shown on the pictures here (all photos taken during SolidWorks World last week in San Antonio). It's not just for show, this is how you should be using your favorite CAD software.
Yes, really. Using one screen means that you're toggling between different software and different windows a lot and there's two sorts of time wastage here. First of all, hitting that alt-tab or finding the right window with your mouse takes precious milliseconds. And they add up. Secondly, and more importantly you're doing a mental switch from using a software to finding the right window to start using the content in the new window and then doing it all over going back to the original window. It's a very small distraction but again, it adds up.
Dual monitor setup allows to deal away with both of these as you can use the extra screen and extra space to set up the necessary windows required to fulfilling the task at hand. Yes, using your CAD software laid out on two screens is awesome but often you need to check some details from technical specification, email or consult a website. Now you can put that source next to your design area.
Most (if not all) modern CAD software support dual (or even triple, quad etc) monitor setup so you can really blow things up. Or you can use one monitor for all the toolbars, your model library etc and work on the other one. It's really down to one's work style and preference. It can take a little trial and error to find out what works best for you.
Having that extra screen space doesn't mean that you should cram it full of different applications - your work environment, email, web browser, IM, newsfeed etc. Yes, you can see a lot but this is a fast way to attention fragmentation and instead of getting more done your productivity will actually decrease.
What's your screen setup at work or at home?