2024 CADA Workforce Study explores wages, retention and turnover
The findings of the 2024 CADA Workforce Study were just released, where a record number of Canadian Automobile Dealers Association (CADA) member dealers participated in an extensive study of the labour and employment trends in Canada’s auto retail industry.
The 611 dealerships that took part in the study confidentially provided payroll records that allowed the study’s research partners to do a full analysis of 41,000 active and terminated employee payroll records.
The result? The most comprehensive snapshot of the labour market CADA has ever been able to produce. The findings can help dealerships gain a much better understanding of how the wages and benefits they pay to their employees stack up against the national average, and other key factors such as turnover and retention rates.
The dealerships who took part in the study got the added bonus of getting to see aggregate results (all submitted payroll data was kept confidential) for dealerships in their geographic region, instead of just the national picture. Participating dealers were also able to take part in a series of webinars by the research and study partners who explored the findings and what they mean for the HR and management teams running their dealerships.
“The automotive industry continues its journey of adaptation and resilience, and the CADA Workforce Study stands as a vital resource in this endeavour. By providing comprehensive insights into various workforce metrics, it equips dealer members with the necessary tools to thrive amidst emerging trends and transformative mandates, including the ongoing transition to 100 per cent zero-emission vehicles by 2035 and the federal luxury tax,” said Tim Reuss, CADA’s President and CEO in his opening remarks in the study.
The statistics in the study were broken down into four levels of information:
- All-dealerships nationally;
- Luxury and non-luxury (mass market) dealerships;
- Higher volume and lower volume dealerships based on units sold; and
- Urban and rural dealerships.
Here are just a few of the key findings:
2023 Annual Compensation and Weekly Wages
The study found that average weekly earnings for all dealership positions were up 11.4 per cent compared to 2021. The average weekly earnings for dealership employees (including overtime) of $1,880 are an 11.4 per cent increase compared to 2021. Those wages are also 56 per cent higher than the average weekly earnings for all Canadian employees in 2023, according to StatCan figures. These earnings also kept slightly ahead of inflation (Figure 1).
“In the Top Quartile among dealership positions, 75 per cent of car dealership employees are earning less than $115,587 while 25 per cent are earning more than $115,587.”
2023 Annual Compensation by Key Positions
The study found that although earnings growth for General Managers and Sales Managers slowed in 2022 and 2023, earnings growth for Sales Consultants continued at a higher rate that outpaced inflation.
The 2023 National median salary across “All Positions” in the CADA Workforce Study is $77,272 per year, which represents a 10 per cent increase compared to 2021. That means half (50 per cent) of people working in car dealerships are earning less than $77,272 while the other half earned more than $77,272.
In the Top Quartile among dealership positions, 75 per cent of car dealership employees are earning less than $115,587 while 25 per cent are earning more than $115,587.
The General Manager / Operator position continues to lead the earnings pack by a wide margin — with the top 10 per cent earning a whopping $497,431 per year, with the national average being $289,693 (Figure 2).
Luxury vs. Non-Luxury Dealership Compensation
The study also looked at the difference in earnings between employees working for luxury vs. non-luxury dealerships.
Typically, luxury franchise dealership employees have higher earnings, and that remained true in this year’s findings. The differences in earnings, however, vary by position, with a 25 per cent wage advantage for luxury Sales Consultants over their non-luxury colleagues (Figure 3).
2023 Employee Retention and Turnover
Another key stat, closely watched by dealership teams is total annualized employee turnover. In 2023, it dropped four points from 2021 to 31 per cent.
Employee turnover ranged from a low of 6 per cent for GMs to a high of 50 to 60 per cent for lube technicians, lot attendants/porters, cashiers and receptionists. The turnover numbers include voluntary separations and involuntary terminations, as well as retirements.
The study also looked at retention rates. Retention is the percentage of employees a dealership retains in a position over a period, whereas turnover is defined as the percentage of employees who leave a position over a defined period of time.
The study found that one-year retention for all positions in 2023 was 76 per cent — unchanged since December 2021.
Three-year retention dropped two points since 2021 to 54 per cent in 2023.
The study’s research partner, ESi-Q found that sales consultants, service advisors, and service technicians reach their peak productivity after three years in the dealership.
The three-year retention rate for service techs was 69 per cent and 49 per cent for sales consultants and 45 per cent for service advisors. That means more than 50 per cent of employees in these key positions leave the dealership — before they reach peak productivity (Figure 4).
Dealership Workforce Demographics
The study also found that women were still underrepresented in the industry, making up only 23 per cent of active employees — a number that didn’t change since 2021. In fact, the authors found the female ratio has increased less than two percentage points since 2016.
In terms of positions within dealerships, F&I managers have the highest ratio of women at 41 per cent, followed by service advisors at 35 per cent (Figure 5).
CADA’s study partner, ESi-Q prepared the reports.
MNP is the exclusive sponsor of the 2024 CADA Workforce Study. MNP is a leading national accounting, tax and business consulting firm in Canada that works for clients in the public, private and not-for-profit sectors. Through partner-led engagements, they provide a collaborative approach to doing business and personalized strategies to help organizations succeed.
You can download a full copy of the report under the Knowledge tab on the cada.ca website.
