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Average Vacation Time

Looking at the Average Vacation Time to Determine Your Business’s Policy

As a small business owner, you get to determine whether your employees receive paid time off from work or not. If you choose to offer paid vacation and sick days as an employee benefit, you might not know where to start. Knowing the national average vacation time could help you decide.

With paid vacation time, your employees receive their regular wages when they aren’t at work. This lets employees spend time with their families, focus on their hobbies, or take a break from work.

Benefits of paid vacation time

Offering paid vacation time is beneficial to employees and your business. After taking time off, employees are more:

  • Productive
  • Innovative
  • Relaxed
  • Engaged
  • Balanced

Paid vacation time is relatively inexpensive compared to other benefits you could provide. Offering paid vacation time could decrease employee turnover rates, increase your business’s bottom line (due to increased productivity), and result in satisfied employees.

Average vacation time

Companies are not required to offer paid vacation days to their employees. However, the majority of companies do. The Bureau of Labor Statistics (BLS) reported that 76% of private industry workers (e.g., small business employees) received paid vacation days.

Consider these statistics from the BLS for private industry workers when determining your standard vacation policy. Keep in mind that the data does not include sick time, holidays, or bereavement, which are other forms of paid time off you might offer.

The statistics are grouped by the years of service the employee has. They are ordered by least to most days. The most popular range is in bold.

1-5 years with the company

After one year of service at a company:

  • 0-5 paid vacation days (7%)
  • 5-9 paid vacation days (38%)
  • 10-14 paid vacation days (35%)
  • 15-19 paid vacation days (12%)
  • 20-24 paid vacation days (7%)
  • 24+ paid vacation days (2%)

As you can see, the majority of workers were offered between five and 14 paid vacation days. The average vacation time for small business after one year of service is 10 days.

5-10 years with the company

After five years of service at a company:

  • 0-5 paid vacation days (2%)
  • 5-9 paid vacation days (9%)
  • 10-14 paid vacation days (36%)
  • 15-19 paid vacation days (34%)
  • 20-24 paid vacation days (12%)
  • 24+ paid vacation days (6%)

Typically, the more years an employee has worked at a company, the more vacation days they are allowed. The majority of paid vacation days is 10-19 paid vacation days. The average vacation time in the U.S. after five years of service is 14 days.

10-20 years with a company

After 10 years of service at a company:

  • 0-5 paid vacation days (2%)
  • 5-9 paid vacation days (7%)
  • 10-14 paid vacation days (16%)
  • 15-19 paid vacation days (41%)
  • 20-24 paid vacation days (22%)
  • 24+ paid vacation days (13%)

Almost half of employees (41%) have access to 15-19 paid vacation days. The average vacation time for small business employees after 10 years of service is 17 days.

20+ years with a company

After 20 years of service at a company:

  • 0-5 paid vacation days (2%)
  • 5-9 paid vacation days (6%)
  • 10-14 paid vacation days (13%)
  • 15-19 paid vacation days (20%)
  • 20-24 paid vacation days (35%)
  • 24+ paid vacation days (25%)

The average paid vacation days after an employee has spent more than 20 years with a company is 19.

Average Vacation Time

Standard paid holidays

On top of personal days off from work, the majority of businesses also offer standard paid holidays to their employees. However, businesses are not legally obligated to give employees paid holidays.

Over three-fourths of workers in a private industry (77%) receive paid holidays. This percentage is higher or lower based on the type of worker.

For example, 97% of all workers in management, professional, and related positions (private industry) receive paid holidays. Oppositely, only 66% in construction, extraction, farming, fishing, and forestry positions receive paid holidays.

According to the Society for Human Resource Management (SHRM), these are the standard paid holidays that many businesses observe:

  • New Year’s Day
  • Memorial Day
  • Independence Day
  • Labor Day
  • Thanksgiving Day
  • Day after Thanksgiving
  • Christmas Day

Depending on your company, you might choose to stay open for some of these days. Or, you might decide to go off of the federal holiday schedule:

  • New Year’s Day
  • Birthday of Martin Luther King, Jr.
  • Washington’s Birthday
  • Memorial Day
  • Independence Day
  • Labor Day
  • Columbus Day
  • Veterans Day
  • Thanksgiving Day
  • Christmas Day

Creating your vacation policy

You can use the national average when coming up with your standard vacation policy for small business. Or, you can use it as a guide for developing a policy that fits your business.

Not all industries offer the same number of paid holiday and vacation days. For example, if you own a restaurant, you might decide to stay open on New Year’s Day.

When creating your standard vacation policy, you will need to come up with additional rules. Here are a few examples of conditions you might set in your vacation policy:

  • Employees must give you # days/weeks notice
  • Employees cannot take off more than # days at a time
  • No more than # employees can take off the same day
  • Employees can cash in # of vacation days for money at the end of the year
  • Employees can only carry over # days to the next year

You might choose to lump vacation, sick, and personal days under one paid time off policy. With a paid time off policy, your employees have a fixed number of days they can use for any personal reason.

Ready to offer your employees paid vacation days and holidays? Patriot’s time and attendance software integrates seamlessly with our payroll software. With time and attendance, you can manage employee work schedules and track their time-off balances. Try both for free today!

This is not intended as legal advice; for more information, please click here.

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