Screening Employees & Why It Could Save Your Dealership

In the modern economy, employee turnover is a prevailing issue for business owners and management, seemingly irrespective of industry. But nowhere is this problem more pronounced than in the world of automobile dealers. As of fall 2019 average annual turnover rate within the industry was 46%, which represents an all time high. The annual turnover for sales associates was in excess of 80%. While it is easy to pin blame for these trends on the COVID pandemic, turnover had been trending in that direction in the years leading up to the start of lockdowns. Between 2016 and 2019, there was an industry wide increase in turnover of 15%. This situation has only worsened with lockdowns and a slowdown of the economy.

This might lead dealership owners and management to seek ways to mitigate this turnover and find solutions that encourage retention. Several of the factors that lead to employees either leaving voluntarily or being terminated are observable before the hiring ever takes place. With nearly one out of every three Americans possessing a criminal record, and over half of all job applications containing false information, there is a staggering amount of dishonest applicants slipping through the cracks. Employee theft continues to rise year after year, and in the case of dealerships over half of dealership owners have experienced embezzlement from an employee or know someone who has. Not only can background screening greatly reduce the likelihood of any of these adverse events ever making there way onto your dealership, but can also cover you from liability after the fact. All the more reason to do due diligence and know who you hire.

Sources

Cox Automotive:https://www.coxautoinc.com/market-insights/2019-dealership-staffing-study-released

Pew Research Center: https://www.pewresearch.org/fact-tank/2020/11/09/the-pace-of-boomer-retirements-has-accelerated-in-the-past-year/

Data USA: https://datausa.io/profile/naics/car-dealers

Emsi: https://www.economicmodeling.com/demographic-drought/

U.S. Bureau of Labor Statistics: https://www.bls.gov/charts/employment-situation/civilian-labor-force-participation-rate.htm

Wards Auto Dealers: https://www.wardsauto.com/dealers/auto-dealers-get-raw-deal-thieving-employees