Dealership Technician Retention Initiatives - Too Little Too Late?
My observations lead me to state that the industry has not been too kind to the folks that make service happen. I came across this article in Automotive News where a dealer group claims to be “Taking the Bull by the Horns” to address the technician shortage. What are your thoughts? Is this just more talk or is the actual problem finally receiving the attention it deserves?
If you'd like to see what you can do to support tomorrow's technician, I‘ve been actively involved with NASTF’s Road to Great Technicians project since its inception back in 2016 and I would encourage anyone with interest to join and help guide and support this initiative.
On a somewhat related note, there is a new Mercedes ad (radio) that opens with "what parts is your non dealer technician installing on your Mercedes". The ad is touting their 5 year bumper to bumper used car warranty. At the end of the ad there is a final flame stating to bring your vehicle to the dealer where you get genuine Mercedes parts that last longer and are installed my Mercedes techs. Many of us are trying get our shops in order, watching margins and not staying up with our techs needs and paying too close attention to parts margins. I think our saving grace would be most dealer techs I talk to stay at the lower to middle pay scale and their job gets boring. I believe if we create the correct environment (culture) in our shops, treat our customer better than the dealer which is easy, pay Ourselves and our techs well, we can stay competitive.
I've watched with great interest all of the plans being touted to gain and retain technicians. One of the things that I think is being overlooked by our industry is the employee satisfaction pyramid. Here is a link to one with some interesting explanation of how it works.
When I started out in this industry way too long ago, the pyramid didn't really apply. Most of the people in this trade were "car guys" or people that lived and breathed cars. To car guys the ability to work on their passion outweighed both compensation and working conditions in the pyramid, That breed is for the most part extinct. I feel that over the years shops have relied on the passion of the car guys to make a profit. These days the new generation isn't even interested in working in the industry that the car guys lived for.
Until our industry takes into account the changes in the workforce attitude, they are going to have trouble filling positions with good qualified people. The new generation is much more far-sighted and than the generations of the past. They look way more at money spent on schooling versus the returns when completed. It is going to be tough to attract talent unless you can compete with other industries in these areas. With the internet, the upcoming workforce has at their fingertips information about average pay and top pay across all employment categories straight from whatever state they live in. This information is being used to make decisions about career paths where it traditionally has not even been considered in the past.
Until our industry is able to compete with the others we are going to be one of the last choices by the future employees!!
That perspective makes sense and in my opinion, the key here is to make sure that management truly has a deep understanding of what the ground floor is and what it takes to make it work. When upper level management begins to make calls without this, the outcome is usually not what they expected.
The real eye opener is looking at the employment site for your state. Here is a link for Texas forcasting jobs over 36K per year. These numbers do not take into account the amount spent on tools. On a list of 25 Auto repair is number 24. Take a look at the jobs is above it on the list. Think about tooling costs. Every job where a technician could be other than our field requires less investment in tooling and pays more money.
Here is a full list for our state of all occupations.
I honestly believe that this trend is reflected nationwide.
Interesting, knowing how the career provides benefits, retirement etc, I'd be looking to become an electrician working for a school district (I hear my state has great pensions) or other established institutions providing real retirement benefits. No tooling investment, just show up with your skills and knowledge!
Looking at the description they list for auto mechanics, this may be a little misleading to anyone investigating: "Diagnose, adjust, repair, or overhaul automotive vehicles." That is not very descriptive and there is part of the problem.
I believe Rick hit the nail on the head. I wrote an article for autoinc that brought up this very point. If you talk with high school students about their career choices and how they chose them the first thing they will say is I googled it! Students are taught all through school to do research on every topic at hand and make sure they use multiple sources. This means they know without a doubt the actual income. They may use one of these sites listed above, then join a fb automotive group and ask or even go to the local dealership and ask to talk with a technician there. The days of a dealership owner being able to convince a high school student that they are going to make $120k per year when their top tech is making $50k is long gone.
One big thing I think absolutely has to change is the flat rate pay scale. Yes a technician can potentially get paid 60 hours for a 40 hour week but you are asking a student to base his future on a maybe when using this argument. Picture this, a student is talking with a shop owner or manager about getting into the automotive industry. The student says "Please explain to me how my pay structure will work, I am looking at going to a college that is around $15k per year and I want to know what my return on that investment will be." The manager says "well we pay a flat rate pay structure normally starting around $13/hour but you only have to work 40 hours a week and sometimes my techs are getting paid for 60 hours in that 40 hour week." The student then replies "That sounds cool but what happens if we have a slow month or two in the winter months, will I still be paid for the time I spend there?" Shop owner: "No but trust us you'll do okay". Student: So you want me to spend $30k for a two year degree, spend another $10-15K on tools and then come work for you with no guarantee I will actually have a pay check at the end of the month and be able to pay my bills? Thank you for your time but I think I'll go work for Joe, I talked to him at the career fair last week. He owns a production company and wants me to do equipment maintenance. He offered me $23/hour 40 hours a week, time in a half over 40 hours, 401k match, 2 weeks vacation and a $1/hour raise each year after review up to $30/hr. Oh yeah, he also said I didn't have to buy my own tools. I looked into the college program for industrial maintenance and its the same price".
This is the real world, I watch it happen daily. I actually just spoke with the director at the local college about this. 3 weeks ago he received a call from one of the managers of the local inland port. He was told if he had any kids that were not looking to stay in the field or were even looking to not complete the program he just needed 5 kids that new the saying "righty righty left loosey". If he could get them he would pay $18/hour with state benefits. Until we have a valid argument to attract these students away from other fields we will continue to have a shortage. Obviously there are some of us out there doing everything we can to help change the field and there are many shops that have abolished flat rate all together. Last I checked there was actually more shops paying hourly than flat rate. The problem is the dealers are still mostly flat rate and they have first shot at students when the program is factory backed. That means they talk with the students first and they also chase the students away first before we even get to meet them.
Hi Tanner, I could not agree with you more. We ask technicians to be a business within a business. The Caveat is they have no control over what walks in the door. I have been doing some research and according the the BLS, automotive technicians only make about $1000 more now then in the year 2000. The average Snap On tool goes up 7% a year. So in 18 years the cost of tools has gone up 126% Housing has doubled. A Registered Nurse requires a two year degree. They work inside. There are times they have to deal with mess and smells just like us. They are people mechanics. The median income for an RN is $70K. Would it be logical that the median wage for technicians should be the same?
Given the length of time an RN degree takes to achieve and the similar way in which the degree is obtained (co-op during school semesters) I would say it is logical that the wage should be the same. They certainly have to be intelligent people and I believe technicians do now as well to fully grasp the electronic and drivability side of our career. I am not sure I could do their job but having a plethora of nursing friends I'm not so sure they could do mine either. We may not be working on people but we are working on the ambulances they rely on to get those people to them.
I have heard from many technicians older than myself that their wage was $18-$25/hour back in the 80's. It seems odd to me that 30 years later we are at the same wage and possibly even less in some markets. The technology has evolved more in the last 5 years than it has in the last 50. I believe in order to attract students that the field not only wants but actually needs to be able to advance technology they are going to have to recognize that. I also feel that it is going to have to start with the OE's. We in the aftermarket are starting to see that, I have made more money in the aftermarket consistently than I ever was able to in the dealer. I also am light years ahead of where I was working for a dealer in my diagnostic knowledge because of the aftermarket training available. We need to find a way to help guide the OE's to the door and then push them to open it and walk into our world. If we can do that I believe we can start to make change.
Circa 1990 I was paid $28 a flat rate hour. Using the BLS CPI calculator that’s about $55 in today’s money. Factoring inflation, that time was the highlight of my wages as a technician but I submit diagnosing was much much more difficult back then. The shop overhead was much much lower as well not to mention cars broke down more often so the work load was higher per mile driven.
Diagnostic equipment for that era was a Snapon MT2500 that was only useful on GM and Chrysler products. The previous decade I was using analog scopes, an FNC and Allen Smart, but by early 1990’s the digital scopes had made a technology break through so I bought my own HP digital scope for $2000, $3700 in today’s money. I still have it, it’s gathering dust now.😀Alldata was brand new and incomplete at that time.
This is not meant to be nostalgic, I don’t miss those CO headaches every winter morning or the horrible engineering of the 80’s vehicles, just sharing. In hindsight, maybe we deserved higher wages back then.
So what I am hearing both here and on the street is that technicians are not valued as much in the shops as they were nearly 30 years ago. It seems to me that technicians today are worth more than ever. Everything has become more complicated. I will say I would much rather deal with electrical diagnostics than the vacuum hose clusters that we saw in the 1980s.
It depends on the perspective.
The average motorist values technicians below the parts counter man since they check stuff for free. If you can change that, you’ll solve all problems.
The industry has a strong desire for cheap labor as referenced in the article in this thread. So it can be said the majority of shops undervalue technicians . Having said that, none of that matters on an individual level since there are good jobs out there.
Last week a shop owner told me he lost 2 techs. His b tech was getting $35 an hour and left for better pay. Another shop owner that is looking for an A tech told me the offers he has made and they are above that and those offers were declined so I’ll let the readers decide if they value technicians or not. (Most shops have no desire for an A tech btw).
The biggest complaint I hear from shop owners is technicians thinking they are A techs when they aren’t. I happen to agree so maybe technicians over value their own skills.
But if you want to know what a technician is really worth, the market has determined that value:
I agree completely!! I was on flat rate for most of my 50 years. I did very well, but it is NOT going to work anymore! If I was doing all shop work today, I would not work for flat rate. I have had many a tech take their yearly income and divide the total hours worked, and they realize all that wasted time with no cars to fix drops their hourly pay way down. The good weeks don't cover up the slow weeks! Shop owners are always talking about "effective labor rate" VS "door labor rate". It's the same for techs. Any tech on flat rate should do the math and you will not like the result!
As I have said many times..... "follow the money"!
On Linked In I just saw the most pathetic post regarding employees I recall ever seeing. automotivemanagementnetwork.com/forums/topic/a…. We need to create a working climate where automotive technicians can be self reliant. A technician should be able to afford an apartment, food, insurance, car, ect.. on his or her salary. Last night when doing training I asked a new graduate what he was paying for rent in Salt Lake City. $1000 per month was the answer. I don't know his pay. If his rent is supposed to reflect no more than 35% of his take home income, he needs to make around $3500 a month to just survive. If he makes $25 an hour, this would mean he or she would need to flag 140 hours every month. For a new tech, this may be a challenge.
I probably shouldn’t reply but that article was humurous to say the least. It’s that type of thinking that makes things worse, not better. Their average technican staying at the dealership is dropping so they are throwing 3.5 million dollars at a project to develop more cheap labor. No attempt to understand why technicains wont even stay 4 years, 3.8 years according to article. Think about that for a minute and you have the answer as to why they can’t keep help. They want cheap labor.
As the meme says, prove me wrong. 😀
Some truly believe all that's needed is for the tech to plug in and get a report of what to replace. We all know that's not the case and I believe the industry is going to experience some disruption in the next few years...
You are not too far from the truth. A couple of years ago at industry week in Las Vegas, my former employer invited many of the OEMs to view our soon to be released product. One of the products was a labscope. The comment from the tool buyer was that they had service manuals and advanced scan tools that would bring the technician to the correct conclusion. They did not need tools like this.