The panel in question is supposed to have one label for each button.

1) The panel is missing labels for the “on” and “off” button.

I think the above sentence is incorrect because "labels" is plural and thus insinuates that each button has multiple labels.

2) The panel is missing the label for the “on” and “off” button.

I think this sentence is incorrect as well since "label" is singular and implies that there's only one label (which is missing).

Thanks, EE.
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