Technician retention is becoming a key driver of profitability for dealers and service providers who are relying more on service work to keep their businesses in the black.One fact confirmed by Trucks, Parts, Service publisher Randall-Reilly’s 2018 survey of more than 1,200 diesel technicians is the best way to retain techs overwhelmingly continues to be a strong pay structure.
Today’s technicians understand their value to their employers. They realize how much revenue they generate and are no longer willing to work for less than their fair share.
More than 70 percent of technicians responding to Randall-Reilly’s survey in the heavy truck, construction, agriculture and automotive industries pegged pay and benefits as their top factor when abandoning a job or choosing a new job. Within just the trucking market (the source of more than two-thirds of the survey’s overall responders), pay was the top reason for 72 percent of responders and the second choice for another 11 percent.
Technicians will no longer work for anything less than the best pay they can find.
“Techs know if they are experienced, they can go anywhere and get a job. They can look for the highest bidder,” says Jim Hinton, service trainer, Summit Truck Group. “I don’t think you can reduce your turnover rate without talking about technician wages.”
Despite it being a major point of contention, most technicians are earning a living wage. Nearly 60 percent of heavy truck responders to Randall-Reilly’s 2018 survey reported making at least $50,000 annually, with 38 percent surpassing the $60,000 barrier and 1 in 20 techs (5 percent) claiming to pull in more than $100,000 per year.
Survey responders say their main issue isn’t so much base pay as much as how their pay corresponds to their value. To quote one responder, technicians believe their pay “should be appropriate” to their duties.
One way proactive service providers are looking to solve this issue is by clearly communicating how an employee’s performance corresponds with (and impacts) their pay.
Hinton says Summit Truck Group has started performing bi-annual performance reviews of its technicians to give them the potential to earn multiple raises per year. Hinton says these reviews, coupled with a new bonus program that rewards employees for completing elective online training courses, has increased Summit technician morale and retention.
“I think we’ve tried to create a work environment and culture where [technicians] know they will be rewarded for working hard,” says Hinton.
Truck Equipment Inc. President Jordan Schroeder hopes to have similar success with a quarterly program his team developed called “Give Yourself a Raise.”
“It’s a bonus program where we do quarterly updates on how all of our departments are performing. We talk about margins, labor efficiencies. The goal is to drill into the details of how each employee can make an impact and give yourself a raise,” he says. “One of my hopes with the program is we improve our profitability and that becomes a part of [employees’] pay package.”
Bonuses can be valuable on an individual basis as well. Randall-Reilly’s survey indicates more than 85 percent of diesel technicians are paid an hourly rate — a payment structure that lends itself well to performance-based compensation.
At Affinity Truck Center, bonuses are paid based on technician efficiency, says Service Manager Chris Paris. The more hours a technician bills, the more he earns, he says.
Service providers also shouldn’t overlook the value of providing debt relief and reimbursement for technicians, particularly young professionals still burdened by student loans and tool expenses. Hinton says Summit Truck Group invests in Navistar’s national technical education program that provides equipment, tools and scholarship opportunities to students.
McCoy Freightliner Service Manager Ray Schmidt adds his company recently introduced a tuition reimbursement program for interns and part-time associates that pays 100 percent of a technician’s educational expenses if they maintain a B average and stay with the dealership for two years after graduation.
Any method that shows associates how much they are appreciated has value, service providers say.
“At the end of the day, [technicians] are trying to make a living for their family,” says Charlie Nichols, general manager, TAG Truck Center – Calvert City, Ky.
— Online Associate Editor Bill Grabarek contributed to this article.
Click here to download the Randall-Reilly technician wage survey
TARGETING TECHNICIANS, PART 3
Stemming the turnover tide: Investment in your business can help retain your best technicians
Want technicians to stay at your shop? You better pay
Knowledge is power: Technician apprenticeship programs can increase retention rates
Workplace culture can be a technician retention tool
Millennials aren’t from Mars: Generational perceptions impact technician retention
