According to Project: Time Off, Americans used 17.2 vacation days last year, the most since 2010. Yet despite this marked improvement, over half of U.S. employees (52%) reported leaving vacation days unused at the end of the year. Overall, that means the U.S. workforce left 212 million days unused, or $62.2 billion in lost benefits that amount to an average of $561 donated by each worker to their employer last year.
The reasons for not taking paid time off range from fear of losing their jobs to poor planning, according to the research. But some people don’t get time off at all. In fact, at the federal level, the Fair Labor Standards Act (FLSA) doesn’t mandate that companies pay their staffers for time not spent working (including vacations, sick leave, or federal or other holidays). “These benefits are matters of agreement between an employer and an employee (or the employee’s representative),” it states.
In comparison, the U.S. lags behind other industrialized countries when it comes to federally mandated paid vacation. Paid holiday entitlement in the E.U. is set at a minimum of four weeks (20 days) per year, exclusive of bank holidays; however, a number of countries are even more generous.
So if it’s up to the employer here in the U.S., why does anyone get paid time off to take a break from work at all?
The 1910 failed proposal: three months off
Ironically, the push for paid vacation for workers has roots in the U.S. over a century ago.
President William Howard Taft proposed in 1910 that every American worker needed two to three months of vacation a year “in order to continue his work next year with the energy and effectiveness that it ought to have.” However, U.S. legislators didn’t agree. But across the Atlantic, both Sweden and Germany instituted their own laws, and workers there receive an average of seven weeks paid vacation.
1930s and ’40s New Deal: The union push
It would make sense that unions would have picked up where our legislators left off. That wasn’t the case, though, as historian Michael Berkowitz, author of A ‘New Deal’ for Leisure: Making Mass Tourism During the Great Depression, found that progressive employers in the early 1900s believed their salaried workers from admins to executives needed time off because of “working in offices, indoors, so they need to be rescued and have activity, to be reawakened–for productivity and efficiency.” Berkowitz also noted that department stores in the 1920s were giving their employees paid vacations at camps at the seashore.
Soon after, he notes, management literature begins to suggest that not only white collar workers need a vacation break. Those employed in manufacturing did as well. In the 1930s, the Labor Department organized a committee to look into why there wasn’t a federally mandated policy, especially when 30 countries were then offering some policy protecting the right of paid vacations. No legislation was made at that time.
Unions picked up the slack as they expanded in the mid-1930s, and by 1940, vacation coverage for hourly employees had grown to 50%. A 1943 report submitted to then Secretary of Labor Frances Perkins reveals that nearly 8 million workers, or 60% of those under union agreements, were entitled to paid vacation, up from just 2 million in 1940.
World War II: bonuses for taking vacation
During World War II, when employers were scrambling for talent, paid vacation spread, but more often it was used as a way to increase compensation with wage controls put in place by the National War Labor Board. Since manufacturing supplies for the Armed Forces was of utmost importance during that era, a lot of managers at companies making these supplies went against the recommendations of the Office of Production Management to provide vacation bonuses in place of time off. These employers were worried that their staff wouldn’t be as productive if they didn’t get some paid time off.
Another push to get workers to take paid vacation came from companies invested in getting people to travel in the post-World War II era when the American middle class was enjoying unprecedented prosperity. Berkowitz, the historian, points out that car and oil companies, motel chains, local chambers of commerce, and publicly funded tourism boards–not to mention smooth new interstate highways–galvanized a culture of travel among American working families.
That spurred the seeking of new destinations for vacation, but unfortunately, still didn’t convince lawmakers that they needed to protect the rights of those workers (and their families) to take the time to enjoy them, knowing they’d be paid while they were away from their jobs.
2009 and 2015: Paid vacation legislation dies
Not much progress has been made on a federal level since then. The Family Medical Leave Act (FMLA) was passed by Congress in 1993, guaranteeing a minimum of 12 weeks’ unpaid time off for workers to recover from illness, take time with a new baby, or deal with medical issues of immediate family members. Two attempts to pass “The Paid Vacation Act” (which would guarantee workers just one week of paid time off) in 2009 and 2015 met with opponents pushing back, saying it would kill jobs.
Project: Time Off’s research runs counter to that argument. This year, its analysts found that the more than 700 million days that go unused represent a $255 billion loss to the U.S. economy as vacation time used could have generated 1.9 million jobs.
Once again, employers are picking up where the government leaves off. The Bureau of Labor Statistics‘ last count this year finds that a full 77% of all workers in the private sector are given some amount of paid vacation annually.