Running a shop
Auto Repair Labor Rates by State (2026)
By Mario Martell, former Nissan and Subaru technician and founder of Wrench Node. Published November 11, 2026.
About half of independent shops in the US charge $100 to $149 an hour for labor in 2026, and a quarter charge $150 or more. Below: what the surveys say, a table for all 50 states, how dealers and specialists compare, and a calculator to work out what your shop should charge.
The national picture
The best recent data comes from the 2026 Ratchet+Wrench Industry Survey, about 430 mostly independent shops surveyed in early 2026. Here's how their posted labor rates break down:
| Posted labor rate | Share of shops |
|---|---|
| Under $80 | 7% |
| $80 to $89 | 9% |
| $90 to $99 | 12% |
| $100 to $109 | 12% |
| $110 to $119 | 7% |
| $120 to $129 | 17%, the most common |
| $130 to $139 | 5% |
| $140 to $149 | 6% |
| $150 or more | 25% |
Source: Ratchet+Wrench 2026 Industry Survey.
- A PartsTech survey of about 700 shops (September 2025) found the most common average rate was $100 to $119, and nearly half charge $100 to $139.
- Tekmetric reports a 2026 national average of $132 an hour from its customer shops.
- Half the shops in the Ratchet+Wrench survey (49%) raised their rate in the last two years.
For context, the Bureau of Labor Statistics puts the median technician wage at $24.34 an hour (May 2025). That's what techs earn, not what shops charge. The gap pays for the building, tools, insurance, software, comebacks and the hours techs are paid but can't bill.
Average labor rates by state
Two software companies published state tables in 2026, and they don't agree. We show both so you can see the range. Treat either one as a rough guide, then check what the shops near you actually post.
| State | Tekmetric average | AutoLeap range |
|---|---|---|
| Alabama | $124 | $140–150 |
| Alaska | $161 | $135–150 |
| Arizona | $145 | $125–140 |
| Arkansas | $116 | $140–150 |
| California | $156 | $155–175 |
| Colorado | $151 | $135–150 |
| Connecticut | $141 | $125–140 |
| Delaware | $141 | $130–145 |
| Florida | $138 | $140–145 |
| Georgia | $137 | $140–150 |
| Hawaii | $142 | $120–140 |
| Idaho | $136 | $130–145 |
| Illinois | $135 | $125–140 |
| Indiana | $123 | $135–145 |
| Iowa | $123 | $130–145 |
| Kansas | $120 | $135–150 |
| Kentucky | $126 | $140–150 |
| Louisiana | $132 | $140–150 |
| Maine | $110 | $130–140 |
| Maryland | $141 | $135–145 |
| Massachusetts | $133 | $130–135 |
| Michigan | $130 | $135–145 |
| Minnesota | $137 | $135–150 |
| Mississippi | $125 | $150–155 |
| Missouri | $120 | $135–150 |
| Montana | $135 | $140–150 |
| Nebraska | $127 | $135–150 |
| Nevada | $152 | $130–140 |
| New Hampshire | $128 | $120–135 |
| New Jersey | $140 | $140–145 |
| New Mexico | $141 | $135–145 |
| New York | $125 | $135–140 |
| North Carolina | $123 | $85–105 |
| North Dakota | $135 | $130–145 |
| Ohio | $125 | $130–140 |
| Oklahoma | $129 | $135–150 |
| Oregon | $150 | $130–140 |
| Pennsylvania | $115 | $135–140 |
| Rhode Island | $134 | $120–130 |
| South Carolina | $130 | $130–145 |
| South Dakota | $120 | $130–150 |
| Tennessee | $127 | $140–150 |
| Texas | $141 | $140–145 |
| Utah | $135 | $130–145 |
| Vermont | $110 | $115–130 |
| Virginia | $136 | $130–145 |
| Washington | $152 | $135–145 |
| West Virginia | $100 | $140–145 |
| Wisconsin | $125 | $130–145 |
| Wyoming | $134 | $150–155 |
Sources: Tekmetric, June 2026 (average posted rate from its shops) and AutoLeap, June 2026 (typical range; AutoLeap notes state datasets vary a lot, and its North Carolina figure looks low next to every other source). Consumer sites that quote $200+ per state use a different method and aren't comparable.
Dealer, independent and specialty rates
From the Automotive Management Network shop survey, as reported by MOTOR (2024):
| Shop type | Average rate |
|---|---|
| Dealer | $154 |
| Franchise (Midas-type) | $151 |
| Independent | $137 |
| Euro specialist | $166 |
| Asian specialist | $151 |
| All makes | $133 |
| Tires and wheels | $118 |
Specialists charge more because they carry more tooling and training per car. If you work on European cars, diesels or EVs and charge the same as a general repair shop down the street, you're probably leaving money on the table.
How to set your own labor rate
A state average tells you what the market will bear. It doesn't tell you what you need. Start from your own costs:
- Find the real cost of a billed hour. Tech pay plus payroll taxes, workers' comp and benefits, divided by the share of paid hours that actually get billed.
- Pick a labor gross profit target. Ratchet+Wrench uses about 70% as the starting point. At 70%, your rate is the cost of a billed hour divided by 0.30.
- Check it against the market. If you land far above the shops around you, the fix is usually productivity, not the rate.
- Review it every year. Wages, insurance and rent go up every year. Your rate should too.
Labor rate calculator
Real cost of one billed hour
$44.12
Posted labor rate you need
$147.06
Rate = cost of a billed hour ÷ (1 − target gross profit). Round up to a number that fits your market.
Watch your effective labor rate
Your posted rate is what's on the sign. Your effective labor rate is labor dollars collected divided by hours billed. Discounts, free diagnosis, comebacks and jobs sold under book time all pull it down. In the 2026 Ratchet+Wrench survey, only 11% of shops said their effective rate was 90% or more of their posted rate, and 31% were under 60%.
Wrench Node's month-end report shows your effective labor rate, average repair order and gross profit, and the technician report shows billed versus clocked hours, so you can see where the gap comes from. See reporting. Need forms while you're at it? Grab our free invoice and estimate templates.
Frequently asked questions
What is the average auto repair labor rate in 2026?
About half of independent shops charge between $100 and $149 an hour, and a quarter charge $150 or more. In the 2026 Ratchet+Wrench industry survey, $120 to $129 was the most common range and 25% of shops charged $150 or more. Tekmetric puts its 2026 national average at $132 an hour.
Which state has the highest auto repair labor rates?
Rates run highest in Alaska, California, Nevada, Washington, Colorado and Oregon, at about $150 to $161 an hour in Tekmetric's 2026 data. California also tops other surveys.
Do dealers charge more than independent shops?
Yes. A 2024 Automotive Management Network survey reported by MOTOR put dealers at about $154 an hour and independents at about $137, a gap of roughly 12%.
How do I calculate my shop's labor rate?
Start from what a billed hour really costs you: tech pay plus taxes and benefits, divided by the share of paid hours you actually bill. Then divide by one minus your target labor gross profit. Many shops aim for about 70% gross profit on labor. Use the calculator on this page.
What is effective labor rate?
Labor dollars you actually collected divided by the hours you actually billed. Discounts, comebacks and free diagnostics pull it below your posted rate. Only 11% of shops in the 2026 Ratchet+Wrench survey said their effective rate was 90% or more of their posted rate.
Figures are from the sources linked above, as published in 2024 to 2026. Labor rate data varies a lot by source and method. Tekmetric and AutoLeap are trademarks of their respective owners; their data is cited, not endorsed.
See your real labor rate, not just the posted one.
Effective labor rate, billed vs clocked hours and gross profit in one report. 14-day free trial.
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