Are Labor Rates Too High?

[EricTheCarGuy]

This video is the result of some of the comments posted to last weeks video. What are your thoughts?

Topic

[ron]

i think not really it goes with the times as cars get harder and more advance it go up but not to high

[SpawnedX]

I just want to post this, just to let you know that the rates for top rate technicians in shops are no longer at the levels you are familiar with.

Here is my shop, I will list technicians based on skill level and experience.

A Level Technician, Foreman, Subaru Master Tech Certified, 7 Years Experience: 20.00 Flat Rate Hourly

B Level Technician, Good Diagnostician, Subaru Certified Technician, 7 Years Experience: 17.00 Flat Rate Hourly

B Level Technician, Cannot Diagnose Anything, Subaru Certified Technician, 7 Years Experience: 16.00 Flat Rate Hourly

C Level Technician, Cannot Diagnose Anything, Not Certified, 3 Years Experience: 13.00 Flat Rate Hourly

C Level Technician, Good Diagnostician for Experience, Subaru Certified Technician, 1 Year Experience: 11.00 Flat Rate Hourly

My rate is not included in those. But I promise you I am not even close to making 25.00-26.00.

[EricTheCarGuy]

[quote=”SpawnedX” post=61463]I just want to post this, just to let you know that the rates for top rate technicians in shops are no longer at the levels you are familiar with.

Here is my shop, I will list technicians based on skill level and experience.

A Level Technician, Foreman, Subaru Master Tech Certified, 7 Years Experience: 20.00 Flat Rate Hourly

B Level Technician, Good Diagnostician, Subaru Certified Technician, 7 Years Experience: 17.00 Flat Rate Hourly

B Level Technician, Cannot Diagnose Anything, Subaru Certified Technician, 7 Years Experience: 16.00 Flat Rate Hourly

C Level Technician, Cannot Diagnose Anything, Not Certified, 3 Years Experience: 13.00 Flat Rate Hourly

C Level Technician, Good Diagnostician for Experience, Subaru Certified Technician, 1 Year Experience: 11.00 Flat Rate Hourly

My rate is not included in those. But I promise you I am not even close to making 25.00-26.00.[/quote]

I used those numbers for easy math. Technician pay varies by location and shop. You mostly see the higher paid techs in major metropolitan areas. I knew of some techs in the Chicago area that were getting as high as $32 an hour. I’ve also know places where you top out at $15 per hour. Just depends on the area at the shop.

[Arthur]

I am a Ferrari/Maserati tech, our labor rate is 185$ in Florida. Our shop equipment, diag and special tools, all facilities, customer amenities and the brand name justify the labor rate in my opinion.

[Walter Cheryba]

I cleaned my first spark plug when I was 9-years old after taking a baseball in the face at little league tryouts-sports are not for me. I’m 60-years old now and still suffer from I call “cast iron syndrome.” Thank God-it kept me out of a lot of trouble.
I agree with you about the passion and desire that is required to keep at it and have it be rewarding. I know very well about the ever increasing costs to own and operate an independent shop. Insurance, government regulations, wages, equipment and on and on. I agree with your position about the labor rate and the parts markups.

I retired from doing it full time 5-years ago and these days I like to dedicate whatever time I can to helping that person/family with an older car that just can’t afford the “through the door price” of todays repair facilities. Often it is a case of “give me the keys and when I figure it out I’ll call you” and we go from there. If I can’t diagnose it you owe me no money.

I’m fortunate to have a network of techs and facilities that support me in my efforts. you speak from the heart Eric, that is plain and obvious-good for you-it takes courage. Enough babble from me-I’m going to go get cleaned up!

[Alex Cunningham]

I found an independent shop whose labor rates are really reasonable. My 99 Camry had a bad oil leak. I suspected the valve cover gasket and once the valve cover was off, noticed that the cam bore plug (it’s sort of a freeze plug where the distributor goes on the older models) had obviously been leaking, so I put RTV on that and replaced the valve cover gasket. I felt proud of myself afterward, until I pulled out and noticed to my chagrin that there was a fresh oil stain beneath the car. I looked underneath while it was running and there was a big leak that seemed to be coming off the oil pump. I suspected the shaft seal or kidney shaped o-ring where the pump attaches to the oil pump assembly. I looked up what was required to fix this and discovered that the timing belt had to come off. I decided that I was beaten, for now. I don’t even own a torque wrench yet, and certainly no air tools. 🙁

So my family decided to take it to this independent shop we had used before. He also traced the leak to the oil pump, and was actually pleased to find the Aisin timing belt kit I had left in the car, in an attempt to make the most of his repair time. The kit had the water pump, tensioner and idler bearings and belt all by the OEM manufacturers, just without Toyota branding. I called to ask him to replace the cam and crank seals, and he had already intended to do that. 🙂

So he explained the repair when I picked up the car. It was the oil pump shaft seal (he also removed the groove worn into the shaft by the seal), and he also replaced the pump o-ring. He replaced all the stuff I had in the kit, along with the cam/crank seals. But when I looked at the invoice I was shocked to see that he hadn’t just replaced the oil pump seals, but he had actually removed the entire oil pump assembly, which requires dropping the pan and partially disconnecting the exhaust. It seems like he did this just to replace the pump assembly seal and to reseal the oil pan I guess? He has a reputation for being a perfectionist! And he did all this for $565 in labor! :ohmy: I had expected it to be more, especially considering he removed the entire oil pump assembly. And in spite of this very fair rate he also was happy to install the timing belt kit I provided. I made sure I had the right parts and I made sure they were quality parts, too. Maybe he just has really quick hands and squeezes labor money out that way? I’m in NJ by the way, so the cost of living here isn’t exactly cheap.

Curiously, he also has a reputation for being expensive. I think maybe this is because he uses a lot of OEM parts, and not necessarily because he runs a big markup (he was happy to install my kit and even called it “great”); he’s a huge Toyota fan, and if the oil pump had needed replacing b/c of a worn out shaft, he had planned to buy one from the dealer for like $500 or something. I gave him the part number for the Aisin oil pump kit, which he might like. He’d said on other repairs he’d been stuck waiting for the part to show up from the dealer.

As for customers who balk at the labor rate, I think what’s really needed is a way to let them know that the labor charge covers overhead. Most people see “labor” and $300 and think “robbery”, but if they knew that the labor charge includes taxes, tools, etc they might be more copacetic. “Labor” on the invoice could really use another name.

Attachments:

• 5SFEoilpump.gif

[Nick]

I like the cover photo for this video, shows Eric goes the extra mile to represent!

Proprietary to this business is the parts, the labour (knowledge/skills), and the tools. The electrical bills, rent, water, waste removal, tax, social security, and insurance are not proprietary in any way shape or form. Now, if you think about it, the way shipping and parts stores operate on the www, the parts are less and less proprietary these days. So that leaves labour and tools. Most Mechanics have their own tools. So the end result is that a mechanic can work for say 25$ an hour at a service garage location, which feeds him jobs, or for himself. I paid my friend $120 to install new calipers, rotors and pads in the front. It would have cost me $240 to do it in any dealer. Point in fact, for maintenance and small jobs, the car culture is in good form for diy’ers and hire-by-wire mechanic friends, but for larger jobs and people who have no time to waste and friends that are all posh, the dealerships will bleed you like air out of a brake line.

[Leon]

This video is a good reminder of what shops have to pay for with the labor rates. It makes me glad that I can even attempt to work on my car myself.

[EricTheCarGuy]

[quote=”sunset” post=61624]I cleaned my first spark plug when I was 9-years old after taking a baseball in the face at little league tryouts-sports are not for me. I’m 60-years old now and still suffer from I call “cast iron syndrome.” Thank God-it kept me out of a lot of trouble.
I agree with you about the passion and desire that is required to keep at it and have it be rewarding. I know very well about the ever increasing costs to own and operate an independent shop. Insurance, government regulations, wages, equipment and on and on. I agree with your position about the labor rate and the parts markups.

I retired from doing it full time 5-years ago and these days I like to dedicate whatever time I can to helping that person/family with an older car that just can’t afford the “through the door price” of todays repair facilities. Often it is a case of “give me the keys and when I figure it out I’ll call you” and we go from there. If I can’t diagnose it you owe me no money.

I’m fortunate to have a network of techs and facilities that support me in my efforts. you speak from the heart Eric, that is plain and obvious-good for you-it takes courage. Enough babble from me-I’m going to go get cleaned up![/quote]

Your ‘babble’ and input are greatly appreciated. Thanks for your post.

[Matt]

Independent shop prices here in Northern Nevada is $94 to $99 an hour. Hourly wages for a tech are from 12 to 25. Flat rate is as low as 18 all the way up to 31. On a side note the shops that pay 30 an hour flat rate have a high turn over rate for techs. From what I have seen is true about the parts mark up, our shop mark up is high, Ive see a coil that cost us 30 bucks be marked up to over 100 bucks on the customers bill. So parts mark up is huge.

[Nick]

Here ( in the UK ) I see parts distributors make it easy for the end customers to get discounts, garages tend to get no discount + same day delivery charges. Often the List Prices for garages ordering over the phone are alot higher than the click and collect prices on the website before discount.

To be fair my local garage parts are only marked up around about the charge for same day delivery they get charged.

[Jameson]

at the shop I work at in austin, tx we dont have a tech making less than $21 flag hour. The most experienced tech is making $32 i believe. We have a base pay (20), then $1 per flag hour for every ASE cert you have, and periodic raises for longevity and hard work.

even the service writers and GSTs make about 10 per hour PLUS $10 flag and a dollar raise for every ASE cert

[Jameson]

this is true. thats how they make they’re money. we get a pretty good discount from all the places we order parts from, but the average markup is about 80%

[Jameson]

i just want to reply to what i just said

one of the other techs was telling me that at some of the dealerships he’s worked at, the highest paid techs were at $25 flag, but the average was 16-20. they get a lot more hours though.

i think it really depends on the area you’re in, and whether or not it’s an independent shop or dealership.

Lexus here doesn’t pay much of anything for an experienced tech, but they may flag 60 hours a week, so I guess it’s hard to say what the average might be.

I do know that over the last 10 years or so, pay rates have gone down, and shop rates have gone way up

[Leon]

Either it costs quite a few more dollars for those extra fees and tools or that shops are trying to get richer off the backs of the mechanics. When will the pay inequality end?

[Author]

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