In the manufacturing sector, macro-level headline data suggests that the prolonged, post-pandemic talent crisis is finally drawing to a close. Overall hourly turnover across the industry averaged exactly 31% in both 2023 and 2024, while the average time-to-fill held steady at 34 days (Aon's Attraction and Retention Pulse Survey, December 2025). On paper, the frantic talent churn has plateaued.
2-Year Quarterly Turnover & Attrition Trends for Manufacturing Sector
Source: U.S. Bureau of Labor Statistics (BLS) Job Openings and Labor Turnover Survey (JOLTS), Manufacturing Sector Data 2024–2026.
However, on the shop floor, the reality likely feels a bit different. While appearing to flatten as voluntary quits and total separation flatlined in the past two years, the low turnover rates are not as clear cut as they seem to be. For leadership teams at large enterprise firms, this stability is a trap. Misinterpreting a data plateau as a solved problem creates an illusion of progress, masking deep structural weaknesses that continue to plague traditional manufacturing talent strategies. In fact, Aon’s Attraction and Retention Pulse Survey, December 2025, states that 40% of manufacturers report that retention challenges have remained completely identical to 2024, and 49% of those same respondents state their attraction hurdles are unchanged.
This “stable” turnover inflicts financial damage to manufacturers, and as 96% do not formally quantify the cost, it’s hard to realize. “Stabilization does not mean the problem is solved,” added Joakim Lundberg, Partner, Talent Solutions and Industry Sector Head, Manufacturing at Aon. “The core challenges remain: compensation, flexibility, and career pathways. The manufacturers pulling ahead are those investing in structural solutions rather than relying on short-term fixes or improved market conditions.”
The broader market context adds to why this stagnation can be dangerous. Because the total candidate pool remains structurally restricted, and a staggering deficit of 3.8 million workers is projected to be needed in the sector through 2033, companies can no longer simply look to the external labor market to hire their way out of operational constraints.
To explore how the modern industrial workforce is reframing talent, Manufacturers Alliance surveyed 22 enterprise-tier manufacturers to evaluate the root causes of turnover and to analyze the strategic interventions driving real-world retention (Manufacturers Alliance Turnover Survey, 2026).
The Hourly Shift: From Warm Bodies to Workforce Architecture
For enterprise plants running continuous operations, early-stage hourly attrition is likely a systems architecture failure, not a hiring deficit. The traditional manufacturing approach has long relied on a reactive volume model: pulling baseline labor from the local market, enduring a high-burnout onboarding cycle, and replacing departures with a revolving door of temporary fixes.
Total Annual Average U.S. Turnover Rates for Hourly Workers
Source: Manufacturers Alliance Turnover Survey, 2026. Note: Brackets have been normalized to match the 2025 reporting structure for historical comparison.
“One of the most effective steps an organization can take is to identify pain points across the employee lifecycle and gather data to understand what they are, why they emerge, and how they influence retention,” shared Michael DeNunzio, PhD, Director, Assessment Solutions and account leader for large enterprise manufacturing clients at Aon.
The latest Manufacturers Alliance member survey findings indicate that localized competition remains the most aggressive driver of turnover, with 55% of enterprise leaders flagging competition from other employers in the geographical area as a primary cause of employee loss. Qualitative responses reveal a harsh operational reality: even companies that intentionally pay the highest wages in their regions are still losing hourly operators to nearby, climate-controlled logistics hubs. The friction points are not strictly financial; they are tied to 24/7 continuous shift schedules, physical fatigue, and basic environmental mismatches with the factory floor.
Benchmarking data from Aon's Attraction and Retention Pulse Survey echoes this imbalance, identifying compensation (59%), schedule flexibility (37%), and career opportunities (32%) as the top three reasons hourly workers exit. Aon experts have also seen some organizations unintentionally structurally disincentivizing their best hourly workers from moving into leadership, as “a promotion to a supervisor role is often a pay cut because of losing hourly overtime,” shared DeNunzio, and “many employees want to stay in the hourly role for their career because the benefits are excellent.” It’s leaving manufacturers in a vicious cycle of turnover and fewer opportunities to promote strong leaders.
52%
of manufacturers lack formal, pre-hire assessment tools.
Compounding this problem is a severe vetting deficit at the front door. A staggering 52% of manufacturing organizations completely lack formal, pre-hire assessment tools, according to Aon's Attraction and Retention Pulse Survey. When companies over-index on historical experience rather than screening for baseline behavioral alignment and cognitive aptitude, they set new hires up for rapid exhaustion. “Everyone does structural interviews — whether they’re well-designed or not, that’s a different story. But they’re often overlooking or just glossing over the key behavioral element,” remarked DeNunzio. He added, “You really need to get an understanding of whether the behavioral profile of the candidate matches what is expected of the worker and what the worker will experience if they were to be holding the position.”
The first 90 days represent the most critical window for hourly retention according to Aon’s research findings in 2025. Implementing validated pre-hire assessments that evaluate both "Can Do" factors, like technical aptitude and cognitive reasoning, and "Will Do" factors, like reliability, safety orientation, and motivation, significantly mitigates early attrition.
In one case study, a large client deployed a validated pre-hire screening battery to screen candidates for their highest volume hourly role and realized a 23% reduction in 90-day turnover, yielding $4.8M in annualized savings from reduced recruitment, onboarding, and overtime costs. Sometimes something as simple as misalignment can set the new hire off within those first 90 days. “It’s a job fit mismatch. A new hire might come into the work environment and realize “‘This isn’t what I was sold,’ from skills to culture to even noise,” added Lundberg.
The Aon team supported continuing these pre-hire screenings for the supervisory and managerial levels on the floor as well. It’s “not the most effective” to just hire up, as not everyone has the proper leadership skills even if they’re the top in their role. The impact that leaders have on new hires is strong, so it’s “critical to make sure managers make people feel like they have value, because if they’re having poor interactions, friction is going to happen the first 30, 60, 90 days on the job,” shared DeNunzio.
The Salaried Stagnation: When Careers Flatline, Culture Follows
While the hourly workforce faces an operational burnout crisis, salaried professionals—including roles like plant engineers, supply chain specialists, and finance leads—are experiencing a silent engagement crisis.
On paper, salaried corporate and plant talent metrics appear healthy. Manufacturers Alliance survey data shows that salaried total turnover remains tightly controlled, with a massive 45% of large enterprise firms keeping their salaried total turnover locked within a highly stable 10% to 15% bracket, and nearly 60% reporting average annual voluntary quit rates under 10%. Because these professional employees rarely exit in mass waves, their departures slip through the cracks to build future senior leaders.
Total Annual Average U.S. Turnover Rates for Salaried Workers
Source: Manufacturers Alliance Turnover Survey, 2026. Note: Brackets have been normalized to match the 2025 reporting structure for historical comparison.
“A critical driver of retention, engagement, and performance for salaried and professional employees is visible opportunity for growth and development, paired with clarity on the career options available to them,” noted Lundberg. As Aon has seen with their own manufacturing clients, when organizations give employees more influence over the scope of their role and career direction, engagement and satisfaction tend to rise.
Survey data warns that a significant 32% of large enterprise manufacturers explicitly identify a lack of opportunities for advancement within the company as a primary root cause of voluntary attrition. For a salaried professional in a traditional manufacturing facility, vertical corporate ladders are often clogged by fixed management layers.
In manufacturing, BLS projected voluntary quits at 1.3% for April 2026. A small number, but one that can add up. When high performers realize they have hit a vertical progression ceiling, they disengage and look outward. Across all industries, career development challenges account for 19% of all voluntary professional quits, per the Work Institute. What are they leaving for? The top forces include those seeking growth, career change, or greater job security.
