2022 is already shaping up to be another banner year. In fact, the National Automobile Dealers Association (NADA) issued their 2022 forecast recently, projecting new vehicle sales to reach 15.4 million units – an increase of 3.4 percent. However, labor shortages could put a crimp in an otherwise positive 2022. The good news is there are three simple steps you can take to make your dealership more competitive in today’s labor market.
2022 Labor Market
Auto dealerships certainly felt the impact of the pandemic on employment. In March 2020, COVID-19 shutdowns forced dealerships across the country to lay off most of its sales staff. Since then, many dealers have not returned to pre-pandemic staffing levels. According to NADA, dealership employment for 2021 measured down 4-5 percent throughout the year.
As dealers look to restaff in 2022, some are finding themselves competing in a very tight labor market. Some economists are starting to believe the pandemic has changed the behavior of the job market in ways that could have a lasting impact, including resetting the relationship between workers and their employers.
To put this in perspective, think in terms of supply and demand. The past two years, automotive inventory has been low, and demand has been high, resulting in higher profit margins for dealers, right? In the labor market, job availability is high, and demand is low, resulting in greater bargaining power for potential employees.
When I say demand is low, I mean that people are no longer willing to take a job just for a paycheck. Demand for just a paycheck is low, but demand for a quality career is high. Potential candidates are evaluating not only the current position, but the career path, the work environment, and the overall company ‘attitude.’ The pandemic prompted workers to reevaluate their work-life balance during the lockdown and many employers found themselves on the negative side of the plus-minus decision making.
How can you overcome this challenge? Be smart about your hiring. Start by looking at the dealership job through the job seeker’s eyes.
Step 1: Focus on the candidate’s hiring journey
Smart employers are streamlining their job application processes, engaging the candidate on their preferred platform (email, text, web, phone, social media, etc.), and laying out a plan for success within the company. At EFG, we provide up-front information and transparency for potential job applicants with information like this: https://bit.ly/3GmLYl7
Step 2: Understand their work preferences
Baby Boomers, Gen X, Millennials, and Gen Z have very different work preferences, and it is important to understand the differences. Take this into account when pitching the values of the position, the dealership culture, and opportunities for advancement. Check out our infographic on this topic here: https://bit.ly/3rfIxq3
Step 3: Deliver a fulfilling position
Regardless of the age demographic, employees across the board are not interested in just having a job. They require a fulfilling position with manageable challenges, opportunities for advancement, a dealership culture that is collaborative and respectful, and a company that supports its mission and values through community engagement. Can you clearly articulate why your store is a great place to work? Is your community involvement summarized on your website? Your community involvement is now key to both increasing unit sales and hiring quality talent.