Skills shortage 'winds up' pay levels in dealerships

Two in three franchised dealerships continue to have difficulties in recruiting technicians/mechanics, and sales executives, according to the 2001 retail motor industry pay guide.

Two in five independents also suffered from a shortage of aftersales staff, the report reveals, with bodyshops also experiencing problems, especially in the South-east. In a statement relating to the pay guide, the Retail Motor Industry Federation said the survey meant it was “time to wake up to the recruitment crisis”.

Findings in the guide, produced in association with the Retail Motor Industry Federation, were revealed first to delegates at the Automotive Management People Fair. The event was held at the Heritage Motor Centre, Gaydon, Warks.

Alan Pulham, franchised dealer director of the RMI, said at the People Fair there was cautious optimism that staff turnover might have peaked despite disappointing recruitment figures.

Mr Pulham said the number of respondents to the survey experiencing turnover levels of more than one in five a year was holding at 23%, the same as last year. Three years ago the proportion was 25%.

“Recruitment is though a problem that is not going to go away,” he said. “Bodyshops in particular are having significant difficulties, perhaps arising from static sales due to higher insurance policy excesses and improving repairability of vehicles.”

Guy Liddall, who runs Motor Trade Selection, said people sometimes jumped from one company to another for an extra 50p an hour to find the job was not as good.

Chris Oakham, of Sewells International, who prepared the pay guide survey and chaired the People Fair seminars, said: “Staff turnover is winding up pay which I have been researching in the motor industry for 14 years. This has only been a problem for the past three or four years when there has been a competitive market with skill shortages.”

Mr Oakham said he knew of a bodyshop which fell £25,000 behind budget because it took four months to replace a painter.

Between 1999 and 2000 retail motor industry employees had an average 3.4% wage increase which was in line with the UK generally and above inflation.

It was the same as 1998/99 but below the settlement for 1997/98 (3.5%) and 1996/97 (4%).

Mr Oakham said the average salary for a dealer principal employed by a group was £50,246, taking it above £50,000 for the first time.

Dealer principals were paid best (an average of £64,349) at outlets holding the BMW franchise which created the highest salaries in the five other categories. These were accountant/finance controller, sales manager, sales executive, service manager and parts manager.

Mr Oakham said that in the longer term, retail motor industry employees had done relatively well against inflation. The exceptions were dealer principals.

“They have generally lagged behind inflation, suffering particularly during the recession in the early Nineties because of their profit-based schemes,” he said.

“Now, just as dealer principals start to catch up, their position is watered down in terms of responsibility as many functions are centralised.”