Younger workers are a fast growing part of the U.S. auto dealership workforce, and many of them are heading into service technicians positions with rising salaries. The National Automobile Dealers Association (NADA) released its third annual industry report on the dealership workforce.
The 2014 Dealership Workforce Study Industry Report, produced in partnership with ESI Trends, provides data on compensation, benefits, retention and hours of operation.
In 2013, total dealership employment grew 3.4 percent to more than 1 million people. The weekly median earnings in 2013 were $976, or 25 percent more than the average median weekly earnings for the U.S. private sector workforce. Earnings grew again this year, although at a slower place than in 2012 (1.3 percent versus 3.7 percent). Turnover in dealership employees is also lower than in the private sector (36 percent versus 42 percent).
As was the case last year, the number of "Generation Y" employees or millennials (those born after the early 1980s) also expanded. According to the research, 47 percent of new hires were from Gen Y, bumping their representation up to 27 percent of the total dealership workforce. Last year, that number was 23 percent.
"Last year the percentage of Gen Y working at dealerships was about the same as in the general workforce," says Ted Kraybill, president and founder of ESI Trends. "The U.S. percentage didn't change this year, but the dealerships grew four percentage points. Most of those are coming in as new service technicians and sales consultants."
Work-life balance is also improving as dealerships try to find ways to ease the long schedules that used to be associated with dealership jobs. The percentage of dealerships that schedule employees to work more than 45 hours per week has dropped every year for the past three years. Only 13 percent of dealerships surveyed scheduled sales consultants to work more than 50 hours, and just 16 percent scheduled service advisors to work those hours.
While the number of women at dealerships increased last year, that figure flatlined in the 2013 data. "That was surprising, because the industry is doing a lot in terms of changing the culture and work-life balance that should theoretically attract more women," Kraybill says. "But we saw no change."
Compensation trends
There have traditionally been pay gaps between high-end luxury dealerships and other dealerships, as well as between different positions within a single dealership. Kraybill says that the gap is narrowing. "The high end of the bell curve stayed the same, but the middle of that curve tightened up some more, so the difference in the medians of various positions narrowed," Kraybill says.
For example, the finance and insurance (F&I) manager median moved down, and the median for sales managers moved up. "But the number of F&I managers making more than $200,000 went up, and is significantly higher than the percentage of sales managers making that salary," Kraybill says.
The traditional 20 percent gap between luxury and non-luxury positions also narrowed by about 2 percent. "We think dealerships are paying more attention to competitive wages, and are trying to maintain things within a range where they aren't overpaying, but they are still being competitive," Kraybill says.
The average salary for parts managers and consultants dropped by about 1 percent over the prior year, but the median for parts managers went up by 2 percent. Service manager pay decreased slightly in 2013, while technician pay went up. "There's a lot of competition for technicians, which is pushing up the average," Kraybill says.
The average salary for a full service technician was $55,064, a 1.8 percent increase over 2012. The median for those technicians is at $51,200, or an increase of 1.1 percent.
For service managers, the national average pay was $105,776 (a drop of less than 1 percent), while the median was $96,283 (a drop of 1.3 percent).
"The median is the more telling number, because although we do remove the outliers in the data, there are still some people that are making really big bucks at big stores, and they skew the average," Kraybill says.
More flexible schedules
While dealerships are trying to keep employee hours under control, those efforts have been complicated by a push to expand evening and weekend hours, particularly for the service department. "Dealers have to be more creative in how they staff, and they have to provide coverage, and they are getting smarter on matching staff to the actual traffic," Kraybill says.
Even though service departments are staying open longer, service advisors are less likely to work more than 45 hours per week than ever before. "One thing people don't recognize is that service advisors work more hours on average than sales consultants," Kraybill says. "Still, the number of dealers that schedule them for more than 50 hours a week is going down, and the number of weekend days that people work is also going down."
Dealerships are also being more flexible about scheduling, although that information is largely anecdotal and isn't necessarily reflected in the hard data. "They're accommodating families where both spouses have to work, they're being flexible with time off," Kraybill says. "It's becoming a kinder, gentler dealership culture."
Subscribe to Aftermarket Business World and receive articles like this every month….absolutely free. Click here.
