Labor Shortage Reaching Beyond Service Technicians

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Prior to the COVID-19 pandemic, the collision repair industry and the broader aftermarket auto industry was struggling with the effects of a widespread technician shortage. Now, as nearly every industry is struggling to find quality candidates in what is now being called “The Great Resignation,” the problems collision repair shops were having finding technicians have just been exacerbated. 

A new study found that 81 percent of auto body shop owners would hire one or more technicians if they walked into their shop looking for a position. Additionally, 29 percent of shop owners would hire two technicians immediately if presented with qualified candidates. 

The report, based on data from the “Who Pays for What” survey conducted by Collision Advice, illustrates not only the ongoing technician shortage but the labor shortage that the auto industry and the larger U.S. economy is facing as shops are looking for more than just technicians. Just under one-third of respondents indicated they currently have a need for a body helper or apprentice. A total of 22 percent of shops are in need of a detailer and 19 percent of shops are looking for a front office estimator. Only 21 percent of shops that responded to the “Who Pays?” survey in April said they were fully staffed and had no job openings for any position. Last October, 37 percent said they were fully staffed, the report said.

“It’s really tough out there right now,” says Daniel Panduro, industry coach and CEO of CARSTAR Sun Valley. “It’s a tough situation and a tough subject and it’s been hard since before the pandemic.”

Independents struggle

For independents like himself, it’s been even harder, Panduro says. 

“Consolidators can pay their people more, depending on their business model, because they can take a hit on gross profit and still get by. We need to raise our prices but often we can’t go as high as they can.”

According to the “Who Pays for What?” study, 12 percent of shops said they had paid a hiring bonus to a new technician within the past 12 months. Roughly 56 percent were for less than $2,000, but just over a quarter of them were for $3,000 or more.

But to Panduro, experiencing hiring success isn’t going to just come down to pay. 

“It has to be more than just what goes in the bank account. That's a primary responsibility, of course, but employees want to show up somewhere that is growing, moving forward and seeing industry trends. If they don’t feel that then their days become numbered and you’re out another technician,” Panduro says. 

Culture important

Shops need to establish a strong culture, where employees feel valued and like they are a part of something that’s growing. One way the industry could still improve in that respect is with benefits. 

According to the 2021 FenderBender Industry Survey, less than 50 percent of shops offer training reimbursement or disability insurance. Only 37.5 percent offer a bonus plan. Among the most common benefits are health insurance (72 percent) and a retirement plan (59 percent). 

The hiring shortage also can’t get better unless expectations for and from young technicians change, Panduro says. He’s had to tame his own expectations of new hires, especially those right out of school. They should not immediately be expected to produce top efficiency and productivity numbers. Schools do a good job of training students, Panduro says, but often the technicians still need a year or two before they get up to speed with more experienced technicians. In the same vein, Panduro sees too many new technicians enter the industry expecting to be at a higher pay level and immediately make an impact. A conversation with young technicians and a shop owner should come early in their tenure so both set reasonable expectations. 

“Tell them you’re committed but it’s going to be a journey. That’s the only sustainable approach,” Panduro says.

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