Average Auto Repair Labor Rates by State

Benjamin Johnson

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June 30, 2026

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Read time: 3 min

Find out what shops in your state are charging, and how to set a labor rate that keeps your shop profitable

In the automotive repair industry, your labor rate is more than just a number on an invoice — it is one of the key metrics that drives your business's profitability and overall growth. For shop owners, staying competitive while maintaining healthy margins requires a clear understanding of how labor costs fluctuate across the country. But knowing the national average is only half the picture. The more important question is: how does your shop compare?

Whether you are running a small independent shop or a high-volume operation, knowing where you stand relative to the average labor rate in your state — and against top-performing shops in your market — is essential.

This guide covers the current landscape of automotive repair labor rates across all 50 states, the factors that drive those numbers, and a step-by-step roadmap for setting a rate that supports your shop's long-term success.

Methodology and Key Terms

Tekmetric built this auto repair shop index as a community resource, backed by data from more than 10,000 shops across North America. Shops can use this tool to benchmark themselves and see how they compare state by state.

Key Terms to Know

Labor rate: The retail price per hour charged to the customer for repair services.

Flat-rate: A pricing model where a job is billed based on a predetermined number of hours from a labor guide, regardless of how long the actual repair takes.

Effective labor rate (ELR): The actual amount of labor revenue earned per billed hour after accounting for discounts, menu pricing, and unbilled time.

Understanding these terms will help you interpret the data below and apply it to your specific situation.

Mechanic Labor Rates by State

The average labor rate across the United States is $132 per hour, with the lowest state at $85 per hour and the highest at $197 per hour. Labor rates vary significantly by state, primarily driven by local cost of living and competition.

📊 See How Your Shop Compares — Free

The data below tells you what shops in your state are charging. But the labor rate is only one piece of the picture. The Tekmetric Shop Index lets you benchmark your shop across the four metrics that actually drive profitability — ARO, car count, parts margin, and effective labor rate — against thousands of real shops nationwide.

It's free, takes less than two minutes, and requires no Tekmetric account.

➡ Benchmark Your Shop Now →

Hourly Automotive Labor Rates by State

  • Alabama $124
  • Alaska $161
  • Arizona $145
  • Arkansas $116
  • California $156
  • Colorado $151
  • Connecticut $141
  • Delaware $141
  • Florida $138
  • Georgia $137
  • Hawaii $142
  • Idaho $136
  • Illinois $135
  • Indiana $123
  • Iowa $123
  • Kansas $120
  • Kentucky $126
  • Louisiana $132
  • Maine $110
  • Maryland $141
  • Massachusetts $133
  • Michigan $130
  • Minnesota $137
  • Mississippi $125
  • Missouri $120
  • Montana $135
  • Nebraska $127
  • Nevada $152
  • New Hampshire $128
  • New Jersey $140
  • New Mexico $141
  • New York $125
  • North Carolina $123
  • North Dakota $135
  • Ohio $125
  • Oklahoma $129
  • Oregon $150
  • Pennsylvania $115
  • Rhode Island $134
  • South Carolina $130
  • South Dakota $120
  • Tennessee $127
  • Texas $141
  • Utah $135
  • Vermont $110
  • Virginia $136
  • Washington $152
  • West Virginia $100
  • Wisconsin $125
  • Wyoming $134

Factors That Impact Automotive Labor Rates

Why do auto repair labor rates vary so widely from state to state? A few key factors drive the differences.

Cost of Living

In states with a higher cost of living, shop owners face higher wages to attract technicians, more expensive rent, and elevated utility and supply costs. Those overhead realities push labor rates up — not because shops are padding their margins, but because the math demands it.

Shop Type and Specialization

Dealerships typically carry the highest labor rates because of their overhead, factory-trained technicians, and reliance on OEM parts. Independent shops often have more pricing flexibility, particularly for routine services like oil changes. Specialty shops — focused on European vehicles, diesel, or performance — tend to command higher rates as well.

➡ Benchmark Your Shop Now →

Technician Expertise and Certifications

A diagnostic job requires a different skill set than a brake job. Shops that employ ASE-certified technicians or master technicians can and should charge accordingly. The rate reflects the expertise required to do the work correctly.

How to Set Your Labor Rate (Step by Step)

Setting your rate shouldn't be based on what the shop down the street is charging. It should be a data-driven decision grounded in your actual costs and performance targets.

Step 1: Calculate Your "Loaded" Labor Cost

Start with what it actually costs you to have a technician on the floor. This includes:

  • Wages and overtime
  • Payroll taxes
  • Benefits (health insurance, 401k)
  • Workers' comp and liability insurance
  • Training and certifications

Divide that total annual cost by the number of billable hours that technician produces in a year. That's your loaded cost — and it doesn't include any profit margin yet.

Step 2: Account for Overhead

Your labor revenue also needs to cover the cost of running the business:

  • Rent
  • Utilities and shop supplies
  • Marketing and software
  • Taxes

Step 3: Determine Your Target Profit Margin

Tekmetric shops average 65% labor profit margins. If your loaded cost for a technician is $45 per hour and you want a 65% margin, your base labor rate should be at least $128 per hour.

Step 4: Benchmark Against Your Market

Your internal numbers come first, but you can't ignore the local market. If your rate is $128 and every comparable independent in your area is at $100, you need to either clearly justify your value — through better inspections, faster turnaround, stronger communication — or find ways to reduce overhead. Benchmark against shops of similar size, service mix, and geography.

Step 5: Implement a Labor Matrix

Not every repair order is equal. Shops that implement a labor matrix can automatically adjust rates based on job complexity — billing more appropriately for diagnostic work or specialty repairs without manually recalculating every estimate.

➡ Benchmark Your Shop Now →

How Tekmetric Helps Your Shop Stay Profitable

Managing labor rates manually is a recipe for inconsistency and missed revenue. Here's how Tekmetric gives you the tools and data to stay ahead.

Know Where You Stand with the Tekmetric Shop Index

Before you can optimize your labor rate, you need to know how your performance compares to other shops. The Tekmetric Shop Index gives you free, instant benchmarking across four metrics: ARO, car count, parts margin, and effective labor rate. Enter your shop's numbers and see exactly where you rank against thousands of shops nationwide — no account required, no sales call, no commitment.

You can't improve what you don't measure. This is where that work starts.

➡ Benchmark Your Shop Now →

Real-Time Profitability Tracking

Tekmetric's reporting features give you live visibility into ARO, car count, revenue, and technician productivity — so you always know how your shop is performing, not just at the end of the month.

Custom Labor and Parts Matrices

Tekmetric lets you build a labor matrix that automatically adjusts rates by job type. A custom parts matrix works the same way on the parts side, protecting your margins consistently across every repair order.

Digital Inspections That Justify Your Rate

Tekmetric's digital vehicle inspections let your team send photos and videos of needed repairs directly to a customer's phone. When a customer can see the worn brake pad or the leaking gasket for themselves, they're far more likely to approve the work — and far more comfortable with the rate attached to it.

Accurate Labor Guide Integration

Tekmetric integrates with industry-standard labor guides so your estimates are based on real, accurate times — not guesswork or memory. That means technicians get credited fairly under a flat-rate system, and your service advisers spend less time on paperwork and more time with customers.

Benchmark Your Insights Now

Knowing the average labor rate in your state gives you a useful reference point. But the shops that stay profitable long-term don't stop at state averages — they benchmark continuously, track the right metrics, and make adjustments based on data instead of instinct.

Your labor rate should reflect your actual overhead, your team's capabilities, and the quality of service your customers experience. Use the state data above as a starting point, then go deeper with the Tekmetric Shop Index to see how your shop compares across every metric that drives profitability.

Ready to see where you stand? Benchmark your shop free with the Tekmetric Shop Index →

👉 Ready to grow your automotive business? [Book a personalized Tekmetric Demo Here]

FAQ

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If you run an auto repair shop, chances are you have customers that think they know what’s going on with their vehicle as soon as they set foot in your shop. Although customers with preconceived assumptions can be frustrating at times, we have to give drivers credit for doing their research, especially now when we have a wealth of information at our fingertips.

You’re probably thinking to yourself, “Yes, but automotive repair estimates online aren’t always the best source of information.” And you’re right. But let’s think about ourselves for a second. As people who have experienced the world and have naturally developed our own worries, fears, and doubts, we tend to trust our own intuition and symptom-research sometimes more than we trust professionals.

And it’s a well known fact that consumers have a hard time trusting the auto repair industry—or any business that gives customers diagnoses for that matter. Just as people look up their symptoms online, and come to a conclusion on WebMD, they tend to do the same thing when something is wrong with their vehicle.

Whether it’s true or simply a situation where someone is convincing themselves they have said illness, the internet isn’t going anywhere. And let’s face it, we’re all guilty of using the internet for quick and easy answers, which is why it’s important to empathize with customers. Just as they may Google their symptoms, it is likely that they might type into the search bar, “Why is my car making a rattling sound?”

Of course, it is highly possible that the results that populate aren’t necessarily what an auto repair pro would point out to them. But whatever they find online still gives them some peace of mind, knowing they are informed before stepping foot into an auto repair shop that they may or may not trust.

It’s inevitable: people feel more protected if they understand—or even slightly understand—the issue at hand first.

Now, take a step back and think to yourself where your customers are getting their car repair information from. If you answered “auto repair estimate online tools,” you’re exactly right.

It is often said that “a picture is worth a thousand words.”  When it comes to vehicle inspections, you could even say a photo is worth a thousand happy customers. Digital vehicle inspections (DVIs), complete with photos and videos, give your customers a clear picture of their vehicle’s status and empower them to make well-informed decisions regarding repairs. This not only enhances the customer experience but also fosters a culture of trust and builds long-lasting relationships. Take a look at three ways DVIs can drive growth and success in your shop: 

1. Fostering trust with photos and videos of repairs for approval. 

Digital vehicle inspections provide the clearest way your associates can tell a customer what you found within their vehicle and the possible solutions. Using the media the technician captures, the vehicle owner is empowered to make a knowledgeable decision based on your technical knowledge and experience. 

Sending the customer six to eight photos and videos more than 50% of the time leads to a higher ARO. Not sending enough photos and videos may not give the customer enough information on the health of their vehicle. Conversely, too many images and videos can overwhelm the customer. Capturing the full state of the vehicle with just the right number of photos and videos facilitates a culture of transparency and builds trust with customers, enhancing their experience and leading to more repeat business.

2. Proactively monitoring overall vehicle health.

“I should only get my car inspected if something seems off.” Wrong! A great way to view DVIs is to think about them in terms of overall vehicle health. A thorough DVI can not only provide insight into the customer’s original complaint; it can also give you a full picture of other issues that might be impacting the vehicle or will in the future. Just as you might need blood work and X-Rays for a correct diagnosis from your doctor, a DVI done correctly can provide insight into the health of your vehicle and help technicians make strong, educated repair recommendations.

Completing a routine “check-up” with DVIs can verify if the vehicle is in top-notch shape or proactively identify issues a customer might not see. Even if a customer does not want regular check-ups, technicians can still complete a thorough DVI when the vehicle comes in for repairs and potentially prevent further issues down the road. DVIs go beyond simply making a profit. They are a tool used to build a relationship with customers and ensure their safety on the road.

3. Educating the customer with convenient, easy-to-understand explanations. 

DVIs seek to leave no questions unanswered. When vehicle owners are presented with the option for a repair, they need to know two things: information about the problem and the benefits of the repair. This is where DVIs come in as an opportunity to educate the vehicle owner and give them the information they need to make the right decision. 

With Tekmetric’s MotoVisuals integration, the recommended repairs in a DVI are accompanied by educational videos and animations that give more context to the issue and how the technician’s proposed repair can benefit the vehicle owner. This provides a greater understanding of the repair process for your customers – they can even share the videos with a car-minded partner or friend for a second opinion. By educating the customer on the purpose of a repair, it gives them more confidence in your shop.

Ultimately, DVIs lead to a higher close ratio and ARO because they present the information in a transparent manner that leads to greater trust. When vehicle owners can see the why behind their repairs and understand the value of the solutions you are offering them, they’re more likely to return. As a result, you are setting your shop to experience increased customer retention, stronger relationships with your customers and ultimately, greater profitability.

Digital Vehicle Inspections: Enhance Your Customer Experience

September 20, 2024

Read time: 3 min

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Today’s vehicle owners look for shops that prioritize their evolving needs, and many gravitate towards shops that take care of their entire vehicle in the most efficient manner, from the engine to the tires. As vehicle owners look for a one-stop auto repair shop, shop owners have the unique opportunity to expand their business by also selling tires. This is where Tekmetric’s Tire Suite comes in — a solution that simplifies tire management, letting you save time while leveraging the opportunity to expand your service offerings.

Tire Suite is a feature that your shop can add onto your existing Tekmetric plan. With this add-on, you have access to tire-specific features that allow you to view data specific to your tires and in turn make informed decisions to support that area of your business. By maximizing the information in Tire Suite appropriately, you can open the door to this new business stream – without losing efficiency in your shop. Here are three ways you maximize tire management in your shop:  

1. Time is money – streamline processes to maintain efficiency 

Effective shop management saves you time and money – and there are several simple ways you can apply this strategy to the tire portion of your business. For instance, with Tire Suite, you can reduce the amount of time it takes to register Department of Transportation (DOT) numbers when you sell a tire. DOT registration with Tire Suite registers DOT identification numbers electronically with the appropriate tire manufacturer via the Tiremetrix integration. In addition, you get real-time feedback when entering a DOT number in the system to ensure the validity and recall status of the tire.

Instead of having to worry about compliance or losing hours of time to DOT# entry, your service advisors can gain time back with Tire Suite’s automated registration process. Typically, DOT number registration is a manual task, and the time it takes to enter each number can add up to hours of labor time depending on your shop’s sales. Tekmetric’s Tire Suite allows your service advisors to spend less time entering information and more time with the customer.  By streamlining manual processes like DOT registration, your shop can handle more work in less time and maximize profitability – all while offering a more convenient and comfortable process for vehicle owners.

2. Leverage accurate data to maximize tire shelf life

In addition to tire compliance, it is also important to set up a system where the tires are used in a timely fashion. Tire Suite allows your team to track inventory and maximize the use of available tires while also making sure tires do not sit too long on the shelf. This requires a bit of finesse, and that’s where Tire Suite comes in. Now, service writers can quickly look up all tires for preferred brands that will fit a vehicle and source them directly from inventory or add as a needed job part. 

In addition, tire fitment data allows you to access detailed tire specifications in the RO sidebar for a specific vehicle. For example, if you have a vehicle that needs staggered tires, the data will ensure you get two tires of each type rather than four of the same size. That attention to detail is made possible by leveraging tire-related data – and it can make a significant impact on growing that portion of your business.

3. Build and retain customer loyalty

Once a dealership warranty ends, 70% of customers will seek a repair shop they know they can trust and remain loyal to. Customers value convenience and comfort. When those needs are met, they are more likely to trust your shop and return to do business with you time and time again. 

Shops with the highest retention rates often make tires a part of their business because customers are looking to kill two birds with one stone. Conversely, by not selling tires, you can even hurt your retention rate. When you choose to offer tire management services and provide them in an efficient manner, you are more likely to maintain your customer retention rate because vehicle owners will have everything they need in the hands of their favorite shop.

Adding tire services to your auto repair offerings may seem daunting – but the opportunities far outweigh the challenges. When you leverage the appropriate tools for tire management, such as Tekmetric’s Tire Suite, you can maintain your shop’s efficiency and meet vehicle owners’ needs without missing a beat. The result? Happy, returning customers – and growth in your bottom line over time. 

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