French chalk is the commonly used traditional method of steel marking, A full square stick cut in half length ways and rubbed to a chisel point at one end on a file.
Edit, Forgot to add for fabrication marking out, As rtbcomp says for accurate engineering work use marking blue and scriber etc.
Sharpie marker in three colours to really confuse the idiot in charge, engineers chalk for rough marking out, a fine point permanent marker 0.5mm for accurate work or a scriber for accurate work on large stuff where scratches dont matter.
TCT scribe for me. But I got away with a sharpened masonry nail for years - doubles up as a reasonable centre punch if you get a good one (not all in the same box are the same) too
I use a tipped scriber for most things that need to be accurate on steel. For random marking, like circling scribes marks for drilling I will use engineers chalk.
For sheet metalwork, I use a scriber then a marker pen for highlighting or info like hole sizes.
Eclipse tipped scribers are readilly available, and generally cost
under £10.
Scriber for accurate stuff, sharpened chalk for every day stuff, sharpies for stainless and ally, paint markers for marking part numbers/lengths/ID numbers and the like.
I cover the rough area with a wide indelible ink felt marker, which drys fast, and then use a scriber. If I can't find my proper / decent scribe then a large masonry nail does the same job !
Chinagraph pencils are also useful.
I've a pozidrive screwdriver that's tip broke as it was too brittle. I've sharpened it to a fine point. Has the advantage of a comfortable handle if you have a lot to do, or need extra pressure to go through mill scale.
Freaky, i stood on my last piece of jumbo kids chalk yesterday(which was worse than useless anyway) while tidying up the garage. Was intending to search for a thread i saw on the same subject a while back. Looking for a non-gouging way to mark, french/engineers chalk it is...might get a few markers but they've usually dried out by the time i need them.