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Unused vacation days cost the U.S. economy $236 billion

work in holidayA new study reveals the changes in American vacation habits. Although taking time off from work continues to be a challenge in America’s always-on work culture, the study shows that starting from 2016 American work culture began to change.

GfK conducted an online survey from January 26-February 20, 2017 with 7,331 American workers, age 18+, who work more than 35 hours a week and receive paid time off from their employer. These data were weighted and scaled. The survey included 2,593 managers who are company decision-makers including 479 senior leaders and 2,083 middle managers.

In 2016, average vacation use climbed to 16.8 days per worker compared to 16.2 days the year before. The more than half-day shift changes the trajectory of America’s vacation trendline with the most upward movement seen since vacation usage started its rapid decline in 2000.

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The amount of time off earned by employees in 2016 increased by nearly a full day (.7 days) to 22.6 vacation days. Even with this increase, a slightly smaller percentage of employees (54%) ended 2016 with unused vacation time than the prior year (55%).

Still, 16.8 days is a far cry from the 20.3 day long-term average from 1976 to 2000 and while Americans are using more vacation time, they are also leaving slightly more days unused than before. In 2016, 662 million vacation days were left on the table, four million days more than 2015. The rise in unused days can largely be attributed to employees earning more time off.

While unused days are up slightly, forfeited days—vacation days that cannot be rolled over, banked, or paid out—are down to 206 million forfeited days, an eight percent decrease from 2015. This time has a cost. By forfeiting vacation days, American workers gave up $66.4 billion in 2016 benefits alone. That means that last year employees effectively donated an average of $604 in work time to their employer.

Unused vacation days cost the U.S. economy $236 billion in 2016, due to lost spending. That spending would have supported 1.8 million American jobs and generated $70 billion in additional income for American workers. If the 54 percent of workers who left time unused in 2016 took just one more day off, it would drive $33 billion in economic impact.

The good news is the jump in vacation usage from 16.2 to 16.8 days delivered a $37 billion impact to the U.S. economy. It also produced an estimated 278,000 direct and indirect jobs and generated $11 billion in additional income for employees.

The most effective remedy for American workers who want to use more vacation days is better planning. A majority (52%) of workers who say they set aside time each year to plan out their vacation days take all their time off, compared to just 40 percent of non-planners. They also tend to take longer vacations. While three-in-four (75%) planners take a week or more at a time, non-planners take significantly fewer days—zero to three—than planners at once (42% to 18%).

Americans are still worried about job security when it comes to taking time off. More than a quarter (26%) say they fear that taking vacation could make them appear less dedicated at work, just under a quarter (23%) say they do not want to be seen as replaceable, and more than a fifth (21%) say they worry they would lose consideration for a raise or promotion.

These findings, from Project: Time Off’s State of American Vacation 2017 report, provide the most comprehensive annual look at America’s vacation habits based on GfK survey.

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