Dealership employees want something better

Employees in automotive retail are facing a recession and a tightening job market in 2023, but they are showing few signs of relinquishing the upper hand they gained over employers during the Great Resignation.

The ongoing rocky period in the labour market has seen widespread employee wanderlust triggered by instability during the COVID-19 pandemic.

According to the 2023 Automotive News Canada Retail Salary Survey, which polled more than 600 employees and managers at dealerships across Canada in 2022, 54 per cent have considered leaving their current position or recently found a new job.

Twenty-seven per cent said issues with work-life balance prompted their decision to look for other opportunities, and the same percentage said they faced an increased workload without additional pay. A toxic workplace culture and poor management were two other common reasons for pursuing new opportunities — each cited by nearly a quarter of respondents.

        • Explore our four-part series about wages in Canadian auto retail.

More than half of employees looking for new jobs is a “big number,” said Elizabeth Hall, managing director of Toronto-based Research+Knowledge= Insights, which conducted the research. But it is not out of line with current trends in the wider labour market, she said.

“This is completely standard for every industry — and we survey across tons of industries,” Hall said. “That’s not off the chart by any stretch of the imagination.”

EVERYONE’S LOOKING

Workers across Canada have reprioritized since the pandemic, she said, and the number of job seekers in automotive retail shows that the sector is no exception to this trend.

Dealership staff, in fact, are marginally less likely to be pursuing other positions than employees in other industries. Economywide research conducted in the fall by the recruitment agency Hays Canada found that 60 per cent of workers were “seriously considering” leaving their current roles. The findings were consistent with employee sentiment in Hays’ survey a year earlier and come despite an expected recession this year, said Hays Canada President Travis O’Rourke.

“Even though I’m expecting unemployment to creep upward — nothing too crazy, but it will creep upward — I still think it’s going to be a job market with a lot of movement as people look to keep up with inflation,” O’Rourke said.

“It’s widely known that it’s easier to get a raise or more money when you leave an organization than it is to get your boss to give you a 10-per-cent uplift.”

Employees have been firmly in control of the labour market since mid-2020, when the initial wave of pandemic layoffs ebbed, O’Rourke said. Employers have since faced persistent staffing shortages and high turnover.

TOUGH TO REPLACE STAFF

This heightened level of employee mobility has been a challenge for managers in automotive retailing, almost all of whom said staff losses are concerning.

Of more than 300 managers at Canadian dealerships polled as part of the 2023 Retail Salary Survey, all but three per cent said losing employees had hurt the dealership. A majority cited difficulties finding the “right replacement,” the loss of talent and the time required for training new workers as their most significant concerns.

All told, 45 per cent of responding managers said they had lost one or more direct reports in the past 12 months.

These losses were not inevitable, two-thirds of managers said, contending that they likely could have retained the workers if they had been able to deliver added pay or benefits. About half of these managers said simply giving the departing employees a raise or bonus would have helped keep them in their position. Other retention strategies focus on improving work-life balance and in-office recognition.

A more turbulent outlook for the wider Canadian economy in 2023 could also assist dealerships as they adjust their personnel policies to hold onto staff.

With a recession and tighter labour market looming, O’Rourke said, there are signs that the “balance of power” is shifting back toward employers. He pointed to growing requirements for staff to return more regularly to the office and new job postings beginning to dry up as two examples of the shift.

In 2021, O’Rourke said, someone could get a job “standing on the street.” In the current climate, he said, it is “taking a little more courage” for employees to leave their current position.