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A View of the Industry

A snapshot of the “Collision Industry” survey.

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The I-CAR Education Foundation recently released the results of its latest “Snapshot of the Collision Industry” survey (available at www.i-car.com). Let’s take a closer look …

In 1995 and 1998, the I-CAR Education Foundation surveyed thousands of shops for a collision industry survey on such topics as employee turnover, compensation and other business statistics. The Snapshot of the Industry survey was conducted again for 2001. Surveying 4,000 shops with a response rate of 10 percent, a good cross-section of the industry — across the United States — was represented.

The Big Get Bigger
As you might expect with a consolidating marketplace, the number of small shops got — for lack of a better word — smaller. The percentage of small shops (those with annual sales less than $300,000) dropped from 44.3 percent in 1995 to 28 percent in 2001. Meanwhile, the percentage of large (annual sales of $300,000 to $1 million) and super (more than $1 million) shops have increased steadily. Large shops went from 40.4 percent in 1995 to 45.9 percent in 2001, while the super shops went from 15.3 percent in 1995 to 26.1 percent this year.

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Accordingly, the number of technicians per shop grew as well, hitting an average of 7.7, up from 7.2 in 1998. The percentage of shops with more than six employees also rose steadily, from 20.4 percent in 1995 to 25.3 percent in 1998 to 29.7 percent this year. And while we’re on the upward swing, look at the percentage of shops on at least one direct repair program (DRP): 65.4 percent, as compared to 1998 (55.7 percent) and 1995 (43.4 percent).

The Techs Get Older, But Stay Mobile
Sadly, there’s no way to stop us from aging, but even the average age for technicians went up almost a full year since 1995, up to 36.3 years old. Mainly this is because the number of younger techs has declined, while those in the middle age groups have increased.

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You might – or might not – be surprised to learn that 64.4 percent of today’s technicians were hired from another shop. Meanwhile, 18 percent got hired from a non-automotive industry or got a job for the first time. Eleven percent were hired from a related automotive field, and 7 percent got hired directly from a vocational school. And if you’re wondering where all the women technicians are, stop wondering. They’re not here. Less than 1 percent of autobody techs are women.

When it comes to paying these folks, plans vary. Forty-five percent of shops report using the flat rate system, followed by 36 percent using hourly only. Seventeen percent use a plan that combines hourly plus a bonus, and 2 percent have a team plan.

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The average income for production technicians has increased since 1998, to $41,268. As far as earning potential goes, if good techs stick around, they can make good money – the Snapshot showed that the average income for the top 10 percent of earners was $72,230.

Regarding benefits packages, a majority of shops offered paid vacations and health insurance. But less than half offered life insurance, paid tuition or retirement. However, the number of shops offering “no benefits” was nearly halved, from 19 percent in 1995 to 10 percent this year.

Still, techs seem to be moving on, as the turnover numbers indicate. About 25.6 percent of techs have left their job in the last 12 months, which is higher than the 22 percent from 1998. About 62 percent of technicians have been with their current employer for more than five years. Compare that to the rest of the U.S. workforce, where 52 percent have been with the same employer for more than five years. However, the high turnover number doesn’t mean all techs leaving their shop jobs are leaving the industry. Around 14.3 percent of employees left for a job at another shop. Employee turnout is what shop’s should be concerned about, as 11 percent of technicians (24,000 of them) left the trade over the last 12 months.

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How Do Students and Rookies Fit In?
When it comes to replacing the folks leaving the industry, vo-tech schools seem to be the place to look. But while 5,300 new techs were hired in the last year, those new hires filled 23 percent of the open slots. In other words, 18,500 new techs would have to be hired today to make up for the number of lost techs from the last year. When asked how many more techs they’d hire if the workers were available, 36 percent of shop owners said they’d hire at least one new technician.

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What do shop owners expect their new techs to know, and what are they expecting from the vo-tech schools that trained them? Most owners (more than 90 percent) expected new techs to be able to R&R bolted parts and prep for paint. About 80 percent expected them to know how to conduct final detailing and dent repairs. A slight majority expected new technicians to know how to use a MIG welder and do plastic repairs. A smaller percentage (around 20 percent) expected new techs to be able to perform structural and suspension repairs.

On average, shop owners expect a inexperienced new person to become a fully productive technician in 3.4 years, with the most common answer to that inquiry being two years.

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