By Brian Bastin, Program Director, Automotive Dealership Management Keiser University
Staggering! There is no other way to describe it. Whether you look at it as a percent (14%) or a raw number (7.1 million), the number of men 25-34 years of age who are not in the workforce is truly staggering. Just 20 years ago, the percentage sat at a meager six percent. Why are these statistics important? Simply put, it represents an opportunity to fill those technician vacancies, which keep many service managers awake at night. These numbers only point to the underemployed or unemployed male workforce. The unemployment rate of women who only have a high school diploma is nine percent. This could be another great source to fill the technician shortage.
According to NADA, tech schools graduate roughly 37,000 aspiring technicians per year, but the industry needs over 75,000 just to meet demand. Over the next decade, this will lead to a shortage of over a quarter-million technicians. Historically, technician work has been hard and dirty. While the days of the shade tree mechanic dissipate due to the high level of computerization in today’s vehicles, technician work can still be tough and grueling. Long hours of standing on concrete in an unairconditioned shop will wear out the heartiest of souls. Fewer people see it as a viable and rewarding career. This is the challenge dealers must overcome by directing the narrative.
Dealers have a wonderful story to tell but fail to sell its merits. First, technician work can be financially rewarding. The average technician, according to NADA, earns $61,000 per year, on par with the average salary of all other professions in the U.S. Top technicians, in large metro markets, experience even higher compensation with pay reaching more than $100,000 annually.
Next, technician jobs provide a stepping stone into other opportunities. Some former technicians try their hand at service advising or scratch the entrepreneurial itch by opening their own independent service centers.
Lastly, technician jobs are mentally stimulating. With all the advanced systems on today’s vehicles, technicians need to stay current or face being left behind. Technicians spend countless hours reading the latest technical bulletins and conducting simulation training on today’s vehicles, which are essentially computers on wheels.
Dealers need to lure these millennials off the self-imposed sideline and into the game. These people are missing out on the opportunity to provide for their future in a hot and thriving job market. By waiting years to enter the job market, they create a pay penalty. Pay rises as your career progresses. When a person delays entering the job market, they enter at a lower rate and are never able to fully reach the maximum earning potential of their earlier starting counterparts.
There is a false stereotype that millennials do not want to work hard. While this is not the case, they do prioritize things differently than some other generations do. Millennials desire the opportunity for growth and development, to be part of something important, gel with the company culture, and have flexibility in work schedules. To get here, paradigms need to shift, and dealers need to look to other industries for best practices.
Aside from moving from apprentice to master tech, traditionally, there has been limited room for technicians to do other things in the dealership, except for service advising. Dealer apprentice plans can change this. A technician doesn’t have to be limited to technical work or even service work, for that matter. Progressive dealers can offer apprentice or education classes for technicians to go into parts, service advising, variable operations, and even management.
There is no substitute for knowing all the positions in an organization. That way you truly know what an employee can and cannot do and what the frustrations of that position are. Dealers can run programs on their own or offer education reimbursement for their employees. This builds loyalty and fulfills the growth aspirations of the workers.
It is one thing to attract someone to a job, but keeping that person requires the right culture fit. Sometimes culture needs to adapt. This culture change may be financial in nature or more structural. From a financial perspective, we have seen pay plans go toward more salary in areas such as new vehicle sales and service advising, while the flat rate system remains firmly intact for most technicians. While commission must be a component of any effective technician pay plan, there is room for a salary and CSI components as well.
Non-financial cultural elements also play a vital role. Some dealers are updating locker rooms to look more like professional athletic teams. Plush couches, TVs, and even video game consoles, unheard of a few years ago, are now making their way into these employee break rooms. A little mental break in the day can yield higher productivity and a competitive advantage for those dealers brave enough to change the stale culture of yesterday.
Dealers are increasingly expanding hours of operation to meet the needs of their customers. More and more service departments are open on Saturdays and Sundays. One way to adjust to this is to offer the 3- or 4-day work week to technicians. Nurses and firefighters use this method in scheduling with a great deal of success. By using shifts, dealers can staff the service department on more days, which satisfies the customer demands and technicians have either 3 or 4 days off to enjoy leisure or other activities. Same numbers of actual hours, but more free days to enjoy.
Sometimes, the opportunity is staring us in the face, but we can’t see the forest for the trees. Head down to your local high school or community college and find those students who might be joining the 14%. Remember, each service hour yields an average gross profit of 75% and every hour that doesn’t get turned into an operation hour vanishes forever. Offer to pay for their training, develop the relationships, make some changes, and see what blossoms.
About the Author
Brian Bastin is a professor of Automotive Management at Keiser University. His dealership was highly regarded for its high level of customer and employee satisfaction and profitability. Today, he passes along this knowledge to the next generation of automotive leaders.
EMAIL: [email protected]
