Leftover Vacation Days and the Impact on Your Business

Americans did not use 658 million vacation days last year. For the first time ever, more than half of Americans (55%) did not use all of their days off, according to a study done by Project: Time Off. We are becoming the “No Vacation Nation.”

While Americans used to average three weeks of vacation a year in 2000, in 2015 they only took 16.2 days. That represents a loss of almost one week in 15 years.

Why would people essentially volunteer a week of their time every year for their company? The two biggest factors cited in the study were fear they would return to a mountain of work (37%) and that no one else can do their job (30%).

Unlike other developed countries, in the U.S. employers are not required to give employees paid time off. Employees in the European Union get a minimum of 20 days a year.

While a business owner or CEO may appreciate that their employees didn’t take their allotted time off, research shows their productivity may actually be lower when they don’t take breaks.

Studies show that when employees take time off, their productivity increases. “There is a lot of research that says we have a limited pool of cognitive resources. When you are constantly draining your resources, you are not being as productive as you can be. If you get depleted, we see performance decline. You’re able to persist less and have trouble solving tasks,” said Allison Gabriel, an assistant professor of management at Virginia Commonwealth University in the article “The Secret to Increased Productivity: Taking Time Off.”

In a Wall Street Journal blog, Dr. Kathleen Potempa wrote, “In addition to mental and physical stressors, long periods of work without vacation can lead to reduced productivity, diminished creativity, and strained relationships. Americans seem to believe that logging more hours leads to increased output, but respite deprivation can actually increase mistakes and workplace animosity—in addition to prompting or exacerbating stress-related illnesses.”

CEOs and business owners should look at their own calendars and clear time for vacation as well. Reed Hastings, the CEO of Netflix, takes six weeks a year. “I take a lot of vacation and I’m hoping that certainly sets an example. It is helpful. You often do your best thinking when you’re off hiking in some mountain or something. You get a different perspective on things.”

COO of Facebook Sheryl Sandberg says she was able to write her best-selling book “Lean In: Women, Work and the Will to Lead” because she took all of her vacation days. (I’ve written a book, and would be on the side of people who argue that’s not quite what I’d call a vacation.)

Tony Schwartz, the president/CEO of The Energy Project and author of “Be Excellent at Anything” says at The Energy Project they teach “the greater the performance demand, the greater the need for recovery.” Feeling burnt out one year, he went on vacation and completely disconnected from digital distractions. “By the end of nine days, I felt empowered and enriched. With my brain quieter, I was able to take back control of my attention. In the process, I rediscovered some deeper part of myself.”

Mark Douglas, CEO of the marketing and advertising company SteelHouse, recognized the need for his employees to take vacation and offered them unlimited vacation when he founded the company in 2010. But perhaps due to the reasons stated above, people weren’t taking much.

So he decided to pay them. To take vacation. He pays his employees $2,000 a year to go anywhere in the world. They can split up the money for more than one trip, or use it all at once. Employees who request the money in the form of a bonus are turned down. They must spend it on a vacation.

As a result, his turnover rate is extremely low. Out of 250 employees, only five people left the company in a three-year period, with three of them leaving for reasons unrelated to the job.

So if you are feeling a bit anxious when you see all the empty desks and email vacation notices at your company over the holidays, think of it this way: they are recharging their batteries and will come back more productive than ever.

Take some time off yourself. And enjoy.

My book “How Not to Hire a Guy Like Me: Lessons Learned from CEOs’ Mistakes,” is now available as an ebook.


Improve Your Productivity: Take Time Off

My wife will probably chuckle when she sees this topic. Yes, I’ve been accused at times of suffering with an acute case of workaholism. When you love what you do and are excited about helping companies emerge from tough situations to be viable and more successful, it can be tough to shut down work at a reasonable hour.

Yet studies show that people are actually more productive if they engage in “strategic renewal.” That includes sleeping more, taking more frequent vacations and spending more time away from the office.

An article earlier this year in The New York Times, “Relax! You’ll Be More Productive” claims that paradoxically, the best way to get more done may be to actually do less.

One of my favorite ways to get away from the pressures of work is to go on a cruise.

One of my favorite ways to get away from the pressures of work is to go on a cruise.

While the article discusses studies that show the benefits on productivity of extra sleep and working out, being a numbers guy, this part caught my eye.

“In 2006, the accounting firm Ernst & Young did an internal study of its employees and found that for each additional 10 hours of vacation employees took, their year-end performance ratings from supervisors (on a scale of one to five) improved by 8 percent. Frequent vacationers were also significantly less likely to leave the firm.”

Now that’s something to take note of. Improved performance of 8 percent and a higher retention rate? Those are major benefits that companies can take advantage of just by encouraging employees to take their allotted vacation time.

In the United States we start out with far less vacation time to begin with than our European counterparts. And we don’t even take the few days we do accrue.

In 2010 Expedia, the online travel agency, conducted a survey about vacation days. The average American earns 18 vacation days, but only used 14. Contrast that with countries in Europe where in France, for instance, the average worker gets a whopping 37 vacation days and uses 35 of them.

Only 38 percent of Americans say they use all of their vacation time, while 63 percent of the French do.

This seems a fitting topic at the beginning of a holiday weekend, a time when most workers are actually forced to take a day off when their businesses are closed. But a large percentage of our workforce now works on computers and laptops away from the office, so there may rarely be such a thing as a forced vacation.

You can still disengage from the pressures of work and engage with those around you by shutting off your cell phone or leaving it in the car during social events with friends and spouse. Answering a text during spousal time dampens the mood.

When dining out with friends, have everyone put their cell phones on the table. The first one who touches his or her phone gets the check!

One of my favorite ways to really get away is to go on a cruise. Then I only look at emails at 6:00 a.m. or at midnight when my wife is asleep. I leave my cell phone and iPad in my room during the day so I can really enjoy my vacation.

That means you have to make an effort to well, do less. In recent years I have decreased my working hours somewhat and try to take time to enjoy vacations with my wife. This Monday I’ll be joining millions of Americans who relax on Labor Day weekend, visiting with family or getting one last long summer weekend in before fall sets in.

Aren’t you due for some strategic renewal of your own?