Seeking Shops’ Insights for WMABA Labor Rate Survey

How many office staff personnel work in your shop per technician? How much are shops charging for various labor operations? How much do insurers interfere in your business? These are just a few of the questions WMABA wants you to answer to help the association better understand what’s happening in its market.

For over a decade, WMABA’s Labor Rate Survey has provided insights into the economic realities of running an auto body business throughout the region. Since it was launched in 2012, the bi-annual initiative seeks information from collision repair facilities in nine regions: Annapolis, Baltimore, Charlottesville, Hagerstown, Richmond, Roanoke, Virginia Beach, Washington DC and West Virginia. Results for this year’s rendition of the survey will be published in a future edition of Hammer & Dolly

The 2022-2023 Labor Rate Survey (available online at wmaba.com/labor-rate-survey) asks WMABA-area shops to provide their posted/retail rates for several operations. As always, all Survey results remain completely anonymous; no participating shops will be identified by name. Active participation in the latest Labor Survey allows WMABA to see what changes have occurred since data was last collected two years ago and to analyze significant changes for body shops in their market area since the Survey began.

For example, the Annapolis region showed a 4:7 ratio of office staff to technicians in 2016, a ratio that shifted to 2:3 in 2018 and then 1:1.6 in 2021, reflecting the additional administrative burden that many shops have been forced to undertake in recent years. Although many business costs increased over the same time period, body Labor Rates in Annapolis only rose by 2.37 percent in 2021 compared to 2017, an increase of just $2.20 since 2014! Yet, mechanical labor increased by more than $10 from 2014 to 2021.

“Third-party payers’ systems determine ‘market rate’ based on a variety of information, including discounted DRP rates added by insurers, which skews the overall average in a downward trend that negatively impacts the market,” lamented WMABA Executive Director Jordan Hendler. “But shops often have no idea what to charge. No joke – probably four out of 10 shops actually think their Labor Rate is whatever the insurance company pays, and it’s so frustrating and sad. They don’t know their numbers; they’re not able to manage their business. We want to help shops understand how to come up with a Labor Rate, what their actual door rate would be if there was no outside influence.”

And shops definitely feel like third-party influences are taking place. In 2021, over 98 percent of shops felt that insurers try to control or insert themselves into the repair process, and 98 percent were also told, “We can’t pay for that because it’s against insurance company policy,” even in cases where shops knew the procedure was reasonable and necessary. The same number of shops expressed the belief that insurers’ initial estimates lack proper repair procedures, yet 75.5 percent feared insurer retribution if they “charged for a job performed that you felt was fair, reasonable and necessary, but they may not approve of” – a figure that increased from 68.8 percent in 2018.

So, what does that mean for shops in 2023? WMABA needs YOU to stand up and make your voice known to figure it out!

By tracking marketplace trends and critical industry practices, the Survey provides WMABA with information that allows the association to better understand the industry it serves and its members’ needs. Once Survey data is collected, WMABA will use this information to better serve its members and the industry at-large through legislative, regulatory and educational efforts. H&D