Employee Turnover Rate in Manufacturing: 2026 Benchmarks and Retention Strategies
Manufacturing separations run about 29% a year, quits about 17%. Benchmarks by segment and role, the real cost per departure, and 7 retention strategies.
Manufacturing Industry Turnover Rate
2026 benchmarks, costs, causes, and retention strategies for small businesses
Manufacturing does not have the highest turnover in the United States, and that surprises most owners who live with it. Construction and warehousing both churn harder. What manufacturing has is turnover that is expensive to absorb, and small manufacturers feel it in a way that large plants do not. A large facility spreads a 29 percent separations rate across a dedicated HR department and enough headroom to cover vacancies.
A small shop loses a meaningful share of its floor in the same year. Each departure pulls a supervisor off production to train a replacement, and every gap is visible to everyone still standing at a machine. There is no slack to hide it in.
This guide covers current benchmarks for manufacturing turnover by segment and role, the real cost per departure, the eight drivers behind manufacturing exits, and seven retention strategies that work without an HR department. I built FirstHR partly for this: onboarding infrastructure that cuts early-tenure turnover before it compounds.
What Is the Average Turnover Rate in Manufacturing?
Manufacturing separations averaged 2.4 percent of employment a month across 2025, which works out to roughly 29 percent over a full year, according to the Bureau of Labor Statistics Job Openings and Labor Turnover Survey. Voluntary quits, the part retention work actually reaches, ran near 1.4 percent a month, or about 17 percent annually.
JOLTS publishes separations by industry, not by occupation, so there is no official turnover rate for a single job title. What the wage data does show is where the churn concentrates. Production line workers sit at the low-pay, low-switching-cost end of the floor, and skilled trades at the other.
The rate has come down, not up. Manufacturing separations peaked near 44 percent annualized in 2020 and ran about 40 percent through 2021 and 2022. The 2019 pre-pandemic reading was roughly 31 percent, so the current 29 percent sits below where the industry was before the disruption.
BLS counts a separation as any departure from employment: voluntary quits, layoffs, and discharges alike. In manufacturing in 2025, quits were about 58 percent of the total. That split matters for strategy. Voluntary turnover is what structured onboarding, stay interviews, and career path communication address. Involuntary turnover points back at hiring.
Manufacturing Turnover Rates by Sub-Industry and Role Type
Manufacturing is not a monolith. BLS splits it into durable and nondurable goods, and the two do not behave the same way: nondurable manufacturing, which carries food, beverage, plastics, and chemicals, separates at about 32 percent a year against 28 percent for durable goods. The table sets both against the sectors competing for the same workers.
| Sector | Annualized Separations Rate (BLS JOLTS, 2025) | Why It Matters for a Small Manufacturer |
|---|---|---|
| Leisure and hospitality | About 67% | The benchmark for what genuinely high churn looks like |
| Construction | About 48% | Competes for the same trades as fabrication and machinery shops |
| Retail trade | About 46% | Absorbs entry-level workers who leave production floors |
| Transportation, warehousing, and utilities | About 48% | Pulls hardest on entry-level manufacturing labor |
| All industries (total nonfarm) | About 40% | The economy-wide separations rate, for context |
| Health care and social assistance | About 35% | A common comparison point for small-employer benchmarking |
| Nondurable goods manufacturing | About 32% | Food, beverage, plastics, chemicals: the higher-churn half |
| Manufacturing, all segments | About 29% | The figure a small shop should measure itself against |
| Durable goods manufacturing | About 28% | Fabrication, machinery, electronics, transportation equipment |
| Finance and insurance | About 25% | The lowest-churn private sector BLS publishes |
The breakpoint worth noticing is transportation, warehousing, and utilities at about 48 percent a year, well over half again the manufacturing rate. That sector is always hiring, and for a worker without deep manufacturing skills the switching cost is close to zero. Any wage advantage a warehouse offers creates immediate pressure on food processing and light assembly.
Role-level pay tells the rest of the story. BLS does not publish turnover by occupation, so the pay ladder below comes from the Occupational Employment and Wage Statistics survey (May 2025) and the pattern column reflects what small shops report rather than a published series. The roles at the bottom, starting with team assemblers at a $44,650 median, are the easiest to replace elsewhere.
| Role Type | Median Annual Pay (BLS OEWS, May 2025) | Turnover Pattern |
|---|---|---|
| Industrial engineers | $102,440 | Lowest churn. Career development and pay matter most |
| First-line production supervisors | $74,450 | Managerial responsibility builds identity and tenure |
| Industrial machinery mechanics | $64,520 | Certification investment and a wage premium reduce exits |
| Machinists | $58,750 | Skilled trade, and the hardest role to refill in most shops |
| Inspectors, testers, and sorters | $48,570 | Specialized enough that replacement is slow on both sides |
| Cutting and press machine operators | $46,330 | Some training investment creates a mild retention buffer |
| Team assemblers | $44,650 | Highest churn. Early-tenure departures concentrate here |
| Laborers and material movers | $40,240 | Competes directly with warehousing. Low switching cost |
The pattern is consistent: the more specialized the role and the more company-specific training it required, the lower the turnover. That is both a retention insight and a strategic argument for training investment. When you train a worker to a higher skill level, you raise their value to you and reduce how easily they can replicate it elsewhere.
What High Turnover Actually Costs a Small Manufacturer
A departure costs far more than the job ad. Work Institute puts the full cost of turnover at 33 percent of base salary, with only about 11 of those points landing in direct replacement spend and the rest in lost output and management time. Against the team assembler median of $44,650, one exit runs near $14,700.
The safety category is specific to manufacturing. A floor with a constant stream of new people carries more injury exposure, and more workers' compensation exposure with it.
BLS recorded 2.7 recordable cases per 100 full-time manufacturing workers in 2024, against 2.3 across private industry as a whole. OSHA publishes its training requirements standard by standard rather than as one blanket refresher, so what a replacement hire is owed depends on which standards cover your operation.
Hazard communication is the standard almost every shop triggers. Under 29 CFR 1910.1200(h), training is due at the time of initial assignment and again whenever a new chemical hazard reaches the work area. Compliance-minimum training and genuine safety orientation that prevents incidents are different things.
Here is what these numbers look like for a typical small manufacturing operation:
| Parameter | Value | Notes |
|---|---|---|
| Annual headcount | 30 workers | |
| Annual separations rate | About 29% | Manufacturing average, BLS JOLTS 2025 |
| Annual departures | 8 to 9 workers per year | 29% of 30 |
| Cost per departure | About $14,700 | 33% of the $44,650 team assembler median |
| Annual turnover cost | $118,000 to $132,000 | 8 to 9 departures at about $14,700 each |
| Same math on a machinist | About $19,400 per departure | 33% of the $58,750 machinist median |
| With a 50% reduction in departures | $59,000 to $66,000 saved annually | Achievable with structured onboarding |
8 Reasons Manufacturing Turnover Is So High
High turnover in manufacturing has eight industry-specific drivers. Understanding which ones apply to your operation is the prerequisite for fixing the right things first. The first driver (workplace safety) and the fifth (poor onboarding) are the most controllable for small manufacturers without HR departments.
Two of the eight rest on research worth reading directly. The Shift Project at Harvard Kennedy School found schedule instability to be a strong predictor of turnover among hourly workers, and Gallup found half of 7,272 US adults had left a job to get away from a manager.
Five of the eight are addressable without significant budget: safety orientation, structured onboarding, visible career paths, stay interviews, and supervisor development cost time, not money. A 2007 Wynhurst Group study reported by SHRM found newly hired employees 58% more likely to still be there three years later after a structured onboarding process.
The two drivers that need real budget, wage competition and training investment, often pay for themselves against replacement cost. A $1,500 training investment that keeps one machinist is worth the $19,400 that departure would have cost. The arithmetic is not close.
The First 90 Days: Where Small Manufacturers Lose the Most People
The first 90 days are the highest-risk retention window. SHRM puts up to 20 percent of all employee turnover inside the first 45 days, and Gallup finds about a third of all new employees do not last 90 days. New workers learn equipment, adapt to physical demands, absorb safety protocols, and decide whether the company is worth their time.
Work Institute put 75% of 2025 departures in the preventable column after analyzing more than 120,000 exit interviews. Manufacturing early-tenure exits are among the most preventable of all, because they run on confusion, safety anxiety, and the absence of a check-in rhythm rather than on location or pay gaps nobody can close.
The framework below costs no money and takes roughly 3 to 5 hours of supervisor time spread over 90 days.
The Day 7 review is the most underused checkpoint in manufacturing. By Day 7, new workers have formed their initial impression of the job, the team, and the supervisor.
A structured 20-minute conversation at that exact moment, asking what is unclear and what went well, surfaces problems while they are still fixable. Workers who feel heard at Day 7 are much less likely to be job searching at Day 30.
7 Proven Strategies to Reduce Manufacturing Turnover Without an HR Team
Every retention guide for manufacturing assumes you have an HR department, an LMS, and a dedicated training budget. At a small shop, you have a shift supervisor who also runs production and quality. These seven strategies are designed for that constraint. All seven are achievable by a single manager. None require enterprise software.
The compliance figures in the third strategy come straight from the regulations. Form I-9 paperwork penalties run $288 to $2,861 for each individual a violation involves under 8 CFR 274a.10, and the 20-day federal new hire reporting deadline sits in 42 U.S.C. 653a, with a number of states setting a shorter one.
The pattern across all seven: they require time investment upfront and consistent execution thereafter. The strategies that fail at small manufacturers do so not because they are poorly designed but because production pressure interrupts execution.
A buddy assignment that stops at week two is not a buddy program. A 30-day check-in that gets skipped is not a milestone review. The systems only work as systems.
The seventh strategy is the one most likely to be held once and then quietly dropped, because nothing forces the follow-up. Writing the conversation down, including what you committed to and whether you did it, is what turns a friendly chat into a retention tool.
Our guide to stay interviews has the question set and the record to write it on. On a production floor, add the two questions that only matter here: whether the job still feels safe the way it is set up now, and whether the shift pattern works over the next three months.
How to Calculate Your Manufacturing Turnover Rate
The standard formula for manufacturing turnover rate is: (total separations during period) divided by (average headcount during period), multiplied by 100. For an annual rate, use 12-month separations and average annual headcount.
| Step | Action | Example (30-person shop) |
|---|---|---|
| 1. Count separations | Total employees who left during the year (voluntary + involuntary) | 8 departures in 12 months |
| 2. Calculate average headcount | (Beginning headcount + ending headcount) ÷ 2 | (28 + 32) ÷ 2 = 30 average |
| 3. Calculate turnover rate | (Separations ÷ average headcount) × 100 | (8 ÷ 30) × 100 = 26.7% |
| 4. Compare to benchmark | Manufacturing average: about 29% (BLS JOLTS, 2025) | 26.7% = just below the industry average |
| 5. Separate voluntary from involuntary | Track quit reasons separately from terminations | 6 voluntary and 2 involuntary gives a 20% quits rate |
Tracking voluntary turnover separately from involuntary is the most important refinement to this calculation. The manufacturing average splits roughly 17 percent voluntary and 12 percent involuntary. A shop at 29 percent total that splits 26 voluntary and 3 involuntary has a different problem from one that splits 12 and 17.
Voluntary turnover is what retention investment addresses. If your quits rate is already at or below the sector average, retention spending will return little, and the problem is more likely upstream in hiring or in how the work is scoped.
Frequently Asked Questions
What is the average turnover rate in manufacturing?
Manufacturing separations averaged 2.4 percent of employment a month across 2025, which annualizes to roughly 29 percent, in BLS Job Openings and Labor Turnover Survey data. Quits, the voluntary share that retention work can actually move, ran near 1.4 percent a month, or about 17 percent a year. The remainder is layoffs, discharges, and other separations. The rate has been falling rather than rising: it peaked near 44 percent annualized in 2020, ran about 40 percent through 2021 and 2022, and now sits below the roughly 31 percent recorded in 2019. Nondurable goods manufacturing, which covers food, beverage, plastics, and chemicals, runs hotter at about 32 percent. Durable goods runs cooler at about 28 percent. A small shop learns more from its own trend across several quarters than from any national figure.
What is a good turnover rate for manufacturing?
Below the industry average is the only benchmark worth setting. Manufacturing separations run about 29 percent a year and quits about 17 percent, so a shop under 29 percent total is doing better than its sector. There is no sourced national figure for a healthy small-business turnover rate, and any guide offering one is inventing it, because published rates vary enormously by industry and by year. Track your own number across four or more quarters and judge the direction rather than the level. Split voluntary from involuntary while you do it. A quit rate falling year over year is real progress even when the headline number holds steady because you tightened performance standards at the same time.
Why is turnover so high in manufacturing?
Eight drivers do most of the work, and injury exposure for new hires leads them. Manufacturing logged 2.7 recordable cases per 100 full-time workers in 2024 against 2.3 across private industry. Next come physical demands and shift work, where the Shift Project at Harvard Kennedy School found schedule instability to be a strong predictor of turnover among hourly service-sector workers. Then wage competition from warehousing: transportation, warehousing, and utilities separates at about 48 percent a year, so that sector hires constantly. Then thin advancement paths, absent onboarding in the first 90 days, a retiring workforce, underinvestment in training, and inconsistent supervisors. Gallup found half of 7,272 US adults had left a job at some point to get away from a manager, which lands hard in a shop with one or two supervisors.
How much does it cost to replace a manufacturing employee?
Work Institute prices the full cost of turnover at 33 percent of base salary, with roughly 11 of those points in direct replacement spend and the rest in lost output and management time. Applied to the BLS national median of $44,650 for team assemblers, one departure runs near $14,700. A machinist at the $58,750 median lands closer to $19,400. Both medians come from the Occupational Employment and Wage Statistics survey, May 2025 vintage. SHRM separately puts average recruiting spend per hire near $4,700, which is the part most owners actually see on an invoice. For a 30-worker shop at the manufacturing average, eight or nine departures a year adds up to somewhere between $118,000 and $132,000 on the assembler figure alone.
Which manufacturing sector has the highest turnover rate?
Nondurable goods manufacturing has the higher separations rate of the two segments BLS publishes, at about 32 percent a year against 28 percent for durable goods. Nondurable covers food and beverage processing, plastics, rubber, and chemicals. Durable covers metal fabrication, machinery, electronics, and transportation equipment. BLS does not break manufacturing down further than that, so any guide quoting a rate for aerospace or pharmaceutical assembly specifically is estimating rather than reporting. The more useful comparison sits outside manufacturing: transportation, warehousing, and utilities separates at about 48 percent, and it competes for exactly the workers a food processing line or a light assembly cell depends on.
How do you reduce turnover in manufacturing without an HR department?
Seven moves work without an HR department. Build a structured first-week safety and equipment orientation. Assign a production line buddy before the new hire starts, and brief that buddy on what the job involves. Automate compliance paperwork with e-signature so Day 1 is not chaos. Put the 30, 60, and 90-day reviews on the calendar before Day 1 rather than scheduling them the week before. Offer whatever shift flexibility the operation allows. Post a skills and pay ladder where people can read it. Sit down with every production worker once a quarter and ask what would make them leave. None of these needs software or extra headcount. All of them need the same manager to keep doing them when production is behind.
How does structured onboarding reduce manufacturing turnover?
It works on two fronts at once. The first is safety: documented first-day orientation, PPE fitting, and equipment instruction reduce the early-tenure injuries that make new workers quit, in an industry whose recordable case rate sits above the private-sector average. Workers hurt in their first month rarely come back. The second is clarity and connection: a scheduled 30-day review, an assigned buddy, and a written 30-60-90 plan give a new hire the information and the relationships that keep them. A 2007 Wynhurst Group study reported by SHRM found newly hired employees 58 percent more likely to still be with the company three years later after a structured onboarding process, and manufacturing sees an outsized share of that benefit because the baseline is so low.
How do you calculate manufacturing turnover rate?
Divide separations by average headcount for the period and multiply by 100. For average headcount, add the beginning and ending headcount and divide by two. For an annual rate, use twelve months of separations and the annual average headcount. Worked example: a shop that started the year with 28 employees, ended with 32, and lost 8 people has an average headcount of 30 and a turnover rate of 8 divided by 30 times 100, or 26.7 percent, a little under the manufacturing average. Run the same formula on voluntary departures alone to get the quits rate, which is the number retention work should move. Tracking both quarterly matters more than getting either one exactly right once.
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