An update from the National Automobile Dealers Association (NADA) notes that dealership wages are on the rise, yet a recent report from Cox Automotive found that “better pay” was the top reason employees consider leaving dealerships for another job.
Dealership Wages Are Increasing
In October of 2019, the NADA released an update of their NADA Data 2019 profile. It showed that average annual earnings for employees at new car dealerships increased 1.3% to $72,800 in 2018, up from $71,916 in 2017.
The report also highlighted the fact that more than 1.1 million Americans were employed by the country’s 16,741 franchised light vehicle dealerships as of the end of June 2019. The annual payroll for these employees came to $66.6 billion, up 2% from 2017. NADA noted that dealership employees have seen steady increases in income and total compensation for the past several years.
The 2019 Dealership Workforce Study from NADA, based on data collected during the 2018 calendar year, highlighted a couple of other positives surrounding dealership wages:
- Median earnings at car dealerships in the U.S. were 23% higher than the private sector.
- The average weekly earnings across all dealership positions increased by 1.3% in 2018, while median weekly earnings increased by 2.9%.
Dealership Employees Still Leaving for Better Pay
Increasing wages and the general opportunity for higher salaries relative to the rest of the retail sector should be a boon for dealerships to attract and keep employees.
Yet, the Cox Automotive 2019 Dealership Staffing Study found that “better pay” was the top reason dealership staff members consider leaving – among those considering a new job. Furthermore, the study identified “staff turnover” as the fourth highest concern holding back franchise dealers.
The Cox Automotive Dealership Staffing Study was released in July 2019. Cox surveyed 1,220 people in the workforce for the study – 502 dealership employees and 718 non-dealership employees.
How Dealerships Can Improve Their Hiring Strategies
The Dealership Staffing Study also found that two out of three dealerships don’t have a staffing strategy in place. Laying out the potential for financial gain highlighted in the NADA data should be part of your store’s pitch to job seekers and current employees.
Here are four other strategies car dealers can adopt to better attract talent and long-term employees:
- Create an environment that values employees – It starts by having the right culture in place that will make employees want to stick around. Offer things like career planning initiatives, mentor programs, and professional development and training for current employees beyond what the automaker offers. These initiatives show current employees and job seekers the opportunity for future growth.
- Have an employment brand – Your dealership needs to have defined core values in place that you want to stand for. Make sure these values are present in job postings and employment materials so expectations are set, and that managers look to these guiding principles when making hiring decisions.
- Look to your top-performing salespeople – Management can examine your dealership’s top staff members and look for shared qualities. You should be looking for these same traits in your hires.
- Always be recruiting – The Cox Automotive study found that dealership turnover is at an all-time high. A good tip is to always be actively recruiting talent instead of waiting until there are openings. The stats say they’re going to come, so you should be looking for the right type of employees at all times.
These strategies can help dealerships invest in good people who have the potential to stick around. Sure, the money is nice, but these strategies make it about more than the money, and the right type of employees are going to recognize the value proposition.
The Bottom Line
Dealerships can improve their hiring strategies by establishing a culture that values their employees and provides paths to growth. The opportunity for financial gain highlighted by the NADA data is just icing on the cake.
A strong team can lead to lasting success at your dealership. Auto Credit Express wants to join your team to provide even more opportunities for success. We work with car dealerships all across the country, offering unmatched special finance leads, new and used car leads powered by CarsDirect Connect, and other services to help grow their bottom lines.
We want to drive prospects through your doors so your awesome team can close the sale! Learn more about our leads and dealer products by calling us at 888-535-2277, or you can fill out the contact form on our website and we’ll get back to you.