Car dealer pay growth stalls and turnover drops to 25%

Pay growth at UK car dealers has stalled, while annual staff turnover has dropped to 25%, according to BDO’s latest Motor Salary Survey. The slowdown in wage increases and lower churn suggest a stabilising labour market, giving dealers clearer cost forecasts and potential improvements in workforce continuity.

Key takeaways

• Pay growth for dealer staff has plateaued, according to BDO data.
• Annual staff turnover among car dealers fell to 25%.
• A more stable workforce may help dealers plan wage budgets.

Pay growth stalls

The BDO Motor Salary Survey indicates that wage increases for dealership employees have paused. Earlier surveys showed steady growth, but the latest figures reveal no further rise.

A halt in pay growth could affect recruitment, as lower incentives may make positions less attractive compared with competing sectors.

The pause may reflect broader economic uncertainty, with dealers balancing operating costs against limited margin growth. Maintaining current wage levels can help preserve profitability while the market settles.

Staff turnover drops to 25%

The same survey records annual staff churn at 25%, a decline from previous years. Fewer employees are leaving their dealer roles each year.

Reduced turnover can lower training costs and improve customer continuity, as experienced staff remain in place longer.

Although turnover is down, the 25% figure remains high compared with other retail sectors, indicating continued challenges in retaining talent within the automotive trade.

Dealer considerations

With wages stabilising and turnover easing, dealers can expect more predictable labour expenses. Budgeting for staff costs becomes simpler.

Retention strategies may shift focus from rapid hiring to developing existing talent, enhancing service quality and profitability.

Monitoring future salary surveys will be crucial; any resurgence in pay growth or rise in churn will require swift adjustment to recruitment and retention policies.

What this means for dealers

Dealers should review compensation plans to ensure they remain competitive despite flat pay growth. Aligning incentives with performance can retain staff without relying on across‑the‑board raises.

The lower churn rate offers an opportunity to invest in training and career pathways, strengthening the workforce and potentially boosting sales performance.

Frequently asked questions

Why has pay growth at car dealers stalled?

Pay growth has stalled because the latest BDO survey shows that after a period of wage increases aligned with inflation, dealer salaries have levelled off. Economic pressure, cost‑of‑living concerns and a tight labour market may be prompting employers to hold pay steady while focusing on other incentives.

What impact does a 25% staff turnover rate have on dealership operations?

A 25% staff turnover rate means roughly one in four employees leaves each year. For dealers this reduces recruitment and onboarding costs and can improve customer relationships, as familiar staff remain with the business longer. However, any turnover still requires attention to maintain service standards and avoid gaps in expertise.