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The Technician Shortage – Let’s Follow the Money: Benefits


benefitsIn nailing down the pros and cons of working at independent auto repair shops or dealerships, one of the issues that crops up over and over again for auto techs is benefits. This is perhaps a symptom of a larger problem: smaller shops tend to have tighter budgets. Since dealerships get warranty work and tend to charge more for repairs, the flow of both customers and profit is often more consistent. Typically the benefits packages they offer their techs reflect this.

In the past 15 years benefit packages have been squeezed for everyone. Almost no one enjoys the same benefits they had in the year 2000. With a large and aging baby boomer population, health insurance has become more expensive for owners of smaller companies – who do not have a large enough workforce to negotiate better insurance rates – until eventually many of them cut it in order to stay in business. Health care costs have only increased, however, so the average person needs insurance even more than they used to. The ACHA, or Obamacare, offers subsidies to families with lower incomes, but many techs are paid too much to qualify for a subsidy and too little to afford to pay big premiums to insure themselves and their families.

According to statistics from the Bureau of Labor, auto tech have a higher than average on-the-job injury rate, and the job itself is physically taxing, so access to medical care now and in the future is an important consideration. Other benefits like paid vacation, sick time, 401K retirement plans, and tool reimbursement also factor into a tech’s decision making when deciding where to work. Benefits packages added to wages make the total reimbursement package significantly higher. Some independent auto shops do offer alternative benefits to their workers, such as the use of their facilities, access to machinery, and free or discounted car parts. A responsive manager can often allow more flexibility to his workers as well, while at dealerships policies are often corporate and rigid.

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Choosing which job is best is a complex decision, and not every tech will make the same one. There are a lot of considerations, including work environment, job politics, job flexibility, and commute. Money is an important one, though, and a benefits package is another form of financial compensation. Auto shops that offer higher wages or comprehensive benefit packages will be able to compete with dealerships better. The question is: can they afford to? It’s a tough market for smaller shops, and many of them suffered setbacks in the recession of the past decade and are only now recovering.

Of course, given the tech shortage, the follow-up question to that one would be: can auto repair shop afford not to offer benefits to their techs?