Five Data-Driven Reasons Businesses Should Encourage Time Off


For the last three years, I have studied the perceptions and behavior around vacation in the workplace and have come to one undeniable conclusion: businesses should be just as invested in employees’ vacation usage as the employees themselves.

Project: Time Off research presents a strong business case for vacation. Here are five of the most compelling reasons that will have bosses everywhere asking their employees, “When’s your next vacation?”

Higher Performance and Vacation Usage are Linked

Last year, Americans left 662 million days of vacation on the table, a third of which (206 million) were forfeited. These forfeited days could not be rolled over, paid out, or banked. Employees who forfeited time last year probably thought that sacrificing that time would help them get ahead, but the data proves that it not only didn’t help them—it may have hurt them. Employees who forfeited vacation time were less likely than those who didn’t to have been promoted within the last year and to have received a raise or bonus in the last three years.

The Next Big Idea Isn’t Coming from a Desk Jockey

Has anyone ever had a creative breakthrough sitting at their desk? Innovation expert Mitch Ditkoff has interviewed 10,000 people over the last 30 years about where they get their best ideas, and less than two percent of them say at work. There are so many examples of how vacation can spur those “aha” moments. The inspiration for Starbucks as we know came from Howard Schultz’s trip to Italy in 1983, where he walked the streets of Verona and became inspired to change the direction of the company. After approaching total burnout, Instagram co-founder and CEO Kevin Systrom headed to Mexico where a beach stroll with his then-girlfriend-now wife produced the idea to use filters on cell phone photos.  Hamilton creator Lin Manuel Miranda told Arianna Huffington it was “no accident that the best idea I’ve ever had in my life—perhaps the best one I’ll ever have in my life—came to me on vacation.”

Time Off Makes for Better Time On

The vast majority of managers say that vacation can make employees more productive and focused (78%). Further, managers agree that vacation can help alleviate burnout (81%) and that giving employees a break makes it easier to ask them to put in long hours when they’re really needed (65%). While productivity can be difficult to measure, the roadblocks to it are pretty easy to identify. Negative team environments and burnout are absolute barriers, but can be neutralized when employees are given time to refresh and reenergize.

Vacation Can Test Your Talent Strategy

Vacation can be a great opportunity to test your talent strategy and give employees a chance to shine when taking on new responsibilities. As Deloitte CEO Jim Moffatt learned, if you have hired the right people and given them the right direction, trust your talent strategy and feel comfortable stepping away. And if you haven’t, it can’t be fixed with a few emails in the days you are off.

Unused Vacation Has a Cost—Seen and Unseen

Think it’s great that employees are skipping vacations? Take a look at what it might be costing your business. The U.S. private sector is carrying a $272 billion vacation liability, amassed over years of employees rolling over unused time off. That’s $2,226 per employee. What’s your company carrying? And more importantly, if it’s a big number, what does it say about your culture?

It’s One of the Most Powerful—and Overlooked—Benefits Companies Offer

When employees rank their top benefits, vacation is number two, just behind health care plans, but ahead of things like retirement plans, pay raises, and bonuses. With all the energy poured into coming up with new perks—laundry facilities, nap pods, pet-friendly offices—one of the most powerful perks is something that’s already in the company handbook. But it has to be encouraged and talked about to be an effective tool. With two-thirds of employees hearing very little about vacation, most companies are failing to make their vacation benefit work for them. Don’t make the mistake of staying silent about vacation time—it matters to employees.

By: Katie Denis

Katie Denis is the senior director and lead researcher of Project: Time Off, a non-profit behavior change campaign aimed at transforming America’s vacation habits.

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