Kevin has worked as a mechanic for Honda and its high-end counterpart, Acura, for three years. His work has taken him to dealerships in California and Oregon. But in both states, Kevin’s career has been marked by hardship because of the complicated way mechanics get paid.
Generally, mechanics make a decent living, earning a median annual salary of $36,600. But most are paid according to a “flat-rate” system, meaning that they only make money when there is actual work to be done. Meanwhile, each task only pays a pre-set number of hours, no matter how long it actually takes to complete. Sometimes this means a mechanic spends 10 hours at his shop but only has two hours’ worth of billable work to get done, so he only gets compensated for those two hours. In one state, California, the discrepancy is supposed to be covered by “unapplied time”: payment for the hours spent at work, regardless of whether or not a mechanic is working on a car. But most states don’t have that kind of protection.
In Oregon, Kevin worked for a flat-rate shop, which meant he and his coworkers got a percentage of the day’s earnings based on how many hours they worked and their official rate. On paper he earned $10 per hour, but he guesses that he made anywhere from “less than $4 per hour around Thanksgiving to as much as $15 per hour.”
Now he works in California, where the laws are a little more robust. He makes $12 per hour for every hour he is at work, regardless of the workload. But he still runs into challenges. In California, unlike most states, anyone who provides their own tools for work is also entitled to double minimum wage, $9 an hour in the state. Since most mechanics do provide their own tools, they are supposed to earn at least $18 an hour. Yet even though Kevin uses his own tools, “my boss is operating in a loophole where he is ‘supplying me tools,’ but the tools are not adequate for the work required,” he explained. He estimates his tools are worth between $16,000 and $20,000.
Jesse is a also a mechanic in California, working for a Toyota dealership. He’s been working in the industry for five years, and he is one of the lucky ones. Jesse’s shop was sued a few years before he was hired for unpaid wages, so he gets paid the $18 an hour minimum, given that he uses his own tools, for any time spent at the shop, which rises to $20 an hour when he has billable hours to work on.
Jesse’s shop has another policy, though, which could seriously affect his earnings later in his career. Mechanics at the shop max out at $24.50 per hour, no matter how many extra credentials they have. And mechanics often have a lot of credentials, which they are frequently expected to pay for out of pocket. “I’m a smog tech, so I get paid extra for that, and I have most of my ASE’s done, and I’m a Toyota Advanced Tech from the factory,” Jesse explained. But even with all of these credentials, he’s still being paid the minimum.
Kevin has also taken on extra education to get ahead in the industry, but that means taking on debt. He has $15,000 outstanding in student loans and is struggling to pay them off. The loans are going to make saving for retirement difficult. “I’ve opted out [of retirement] because I don’t make enough to pay into it,” he said. But he’s hoping to start building a retirement account within the next year.
Retirement is an important issue in this line of work, given the physical demands of the job that makes many stop working earlier. Ninety-six percent of mechanics are under age 65, meaning most either change careers or retire by that age. Many people manage to find other work in the industry once they have too many aches and pains to keep going, like teaching, working as service writers who help facilitate communication between customers and mechanics, or as parts employees who order and sell parts for customers and the shop, while some simply cut their hours back to part time. Some officially retire but keep trying to work on cars for money at home.
There are other ways that mechanics end up in financial insecurity. Kevin has seen some people get “run out” of a shop. Because each job pays a certain amount, the owners can give one employee all of the work that does not pay well, making it difficult to make a living. Other times, “They get told there is no work and sent home at lunch.”
Another common way mechanics get underpaid is through service writers who offer discounts to customers. “I’ve noticed that people like to haggle, which is fair because…what they charge people [is] outrageous,” Kevin said. But when people come in to the shop and balk at the cost, it’s often the mechanic who gets penalized. Offering a discount on labor costs simply shortens how much time a mechanic has to fix something that’s supposed to take longer. “Because they don’t bill as many hours, if they pay the guys that’s fixing it the full time, they lose money, so they pay the person who’s doing the work less money,” he explained.
Shops can also give a customer discount by assigning the work to a mechanic who is less experienced and therefore paid less, taking it away from the person who may have originally figured out the problem in the first place. Service writers are paid based on customer satisfaction, so they are motivated to keep the customer as happy as possible, even at a cost to the other employees.
Robert also lives in California. He has been a mechanic for 30 years and has experience with GMC, Honda, and Infiniti. He is a certified smog instructor for the state in addition to being shop foreman. One of Robert’s biggest struggles throughout his career has been a lack of opportunity for development. “Let’s just say, someone has to die for you to move up,” he said.
That lack of advancement opportunities depresses wages. “My gross pay per year has steadily declined or stayed the same since 1999, despite increasing wages and a doubling of the shop’s labor rate,” he said. Even though his shop now charges $130 per hour for labor, up from $74 in 1997, wages haven’t kept pace. His income has been eroded by fewer tasks thanks to that higher rate and an increase in unpaid obligations for his role as foreman.
Given how tough it can be to survive on what they make in shops, mechanics often turn to outside work to make more money. Kevin and Jesse both take on other odd jobs to supplement their incomes, either by helping friends or by buying up cars that need work, fixing them, and reselling them at a profit. Bills would be much harder to pay without this informal work stream, but it also means that the working day winds up much longer.
Like Kevin and Jesse, Robert suggests side work is one of the best ways to make up for lost wages. “The easiest way to compensate for salary deficiency is to do side work,” he said. “I personally don’t like this option as it takes away more time from your family, but sometimes you got to do what you got to do to make things happen.”