Written By: Sofie Bedard, Content Creator, on Feb 14, 2019
A growing number of auto tech positions are being left open as Baby Boomers continue to retire and a lower percentage of Gen Z professionals are graduating, becoming certified, and entering the field.
Excess demand for technicians sits at 49%
According to Automotive News, "the annual turnover rate for the most-skilled dealership technicians rose 27.2 percent in 2016". This shortage could lead to great loses for shops and dealerships alike. The average technician generates $1,000 in gross revenue per work day. Meaning that, a job unfilled for 100 days means a potential loss of $100,000 to fixed operations.
Repair Shops who aren’t yet feeling the pinch will likely experience it soon. According to AutoServiceWorld, 38,829 auto techs graduated in 2016 while demand for new entrants sits at 75,900 per year. This means the excess demand for technicians sits at 49%.
The technician shortage will affect everyone at some level, and organizations who measure and adapt early on will be best positioned to mitigate negative impacts. How does a fleet or shop manager truly know their labor needs without tracking technician tasks?
Whether you are using fleet maintenance software or tracking labor data within a spreadsheet, we recommend tracking and categorizing 3 types of labor to get the most accurate breakdown: indirect, direct, and allocated. See a definition of each below:
In-direct labor is any labor that is not allocated to an asset. i.e. cleaning, running for parts etc.
Direct Labor is any labor associated with an asset. i.e. work-orders, inspections if associated to an asset, or fuelling if associated to an asset.
Say the technician works an 8 hour day. All time should be accounted for i.e. work-order labor, indirect labor, lunch as in-direct labor etc. If there is any time that is not direct or indirect, in the scheduled 8 hours of their workday these are unallocated hours.
Strategic hiring will become key to best responding to the technician shortage. To optimize their hiring strategy, management and recruitment teams will need to understand which skillsets are needed in your shop today.
Let's face it, the technician shortage is not just about a decrease in technicians, but also a decrease in skilled technicians. As admission into skilled trades continue to fall, it becomes imperative for teams to hire strategically to bring the people that meet that unique shop's requirements. But how can you know your missing skills sets, or bloated tasks if you aren't tracking labor?
Tracking labor through a paper, spreadsheet, or maintenance software system can help you identify the skills you are missing so you can prioritize hiring by skillsets. When you have the ability to assign tasks based on skill and experience, you can streamline time on task by getting the right person on the job the first time.
Busy does not always mean productive. To truly measure and manage your shop’s productivity, you’ll need to track the labor performed and optimize the labor hours you do have. Standard repair times help you identify real-time abnormalities in terms of wrench time overages and excessive breaks. If you track PMs, campaigns, repair hours, forecast replacement, reserved hours (how much time for walk-ins, drive ups, etc) you can boost wrench hours, and minimize time spent on non-essential tasks.
To address the technician shortage, your team cannot solely get away with working hard anymore. They need to work smart too. Every shop will require some level of adaptation to meet this changing talent pipeline. We're looking at a future of less people doing better work, which requires the combination of smart workflows, digitization, and the right people.