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Richard Holland

Richard Holland Managing Director

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Offer Value Above a Paycheck To Increase Employee Retention

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Automotive News recently reported that FCA will offer free college tuition to all FCA dealership employees. It will begin immediately in the southeast region and roll out to the rest of the U.S. by the third quarter. This move comes from a deal cut between FCA and Strayer University. According to the article, it potentially covers 118,000 employees. The program is FCA’s effort to increase dealership employee retention. Head of FCA’s dealer network, Al Gardner, states in the article that this is a big pain point for FCA dealers. He believes that this program will “give the dealerships a lever that no one else has.” He also believes that it will give FCA dealers a competitive advantage when a potential employee is considering job opportunities at other brands. And that it could attract job seekers who otherwise may not have considered a job in the auto industry.

 

It has been widely covered that there is a real shortage of well-trained technicians. And this is only becoming more urgent as fewer and fewer freshly trained technicians are coming down the pipeline. The demand for qualified technicians will only increase. Dealerships are already competing to hold onto technicians that receive more favorable offers from competitors. While it is not clear if Strayer will offer automotive technician training, the implementation of this program by FCA was an excellent move. Employees want to feel valued. Providing a free college education – all the way up to a Master’s degree level – is certainly nothing to scoff at. According to the article, a four-year degree at Strayer University would cost between $42,000 and $50,000. That would add an additional ~$10,000 per year in employee benefits. Just like a 401K presents value for job seekers considering a dealership as a potential employer, it will be mighty hard to ignore a free college education.

 

Current FCA technicians will now have a world of opportunity open to them for self-improvement. Many technicians enter this field with little to no formal education from a 4-year university. Some without even having attended a tech school. This allows them to seek an education where they otherwise may not have been able to afford it. While FCA’s program is the first of its kind in the automotive industry, there has been a very successful program running since 1944 by one of our country’s largest employers… The G.I. Bill. This program has been used to successfully recruit – and eventually educate – millions of veterans over the past 60 years.

 

There is no doubt in my mind that FCA has just elevated themselves above other auto manufacturers as a desirable employer. My hat is off to FCA for their move to decrease employee turnover at dealerships by increasing the value and benefits of being a FCA dealership employee. This move will not only assist dealers in recruiting new talent, but also in retaining that talent. The bonus, of course, is that as time passes, FCA dealers will find that they will have more educated staff overall. Which can only benefit the dealership in the long run.

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