A recent study by Project: Time Off found that in 2015, private sector firms had $272 billion in unused vacation time on their books. Even more startling than the enormous number is the underlying fact that employees at all levels understand the importance of taking a break, but few feel that they can. This is a strong indication that, overall, company values do not support vacation as a necessary part of employee productivity and retention.
What it means
The $272 billion amount equates to roughly 658 million days of unused vacation. This is indicative of private employers creating a company culture in which vacations are frowned upon. Employees feel the stress of an increasing workload and the pressure to work without a sufficient break. They may not have the resources to cover their responsibilities while they are out, or feel that the mountain of work awaiting their return isn’t worth the time off.
What it costs
The measurable cost of this widespread problem is the dollar amount of vacation liability on the company’s balance sheet. An even greater but indeterminate cost is loss of productivity due to burnout. Employees who don’t take time off to reboot feel more stressed, overworked, and exhausted. They work less efficiently, which takes a toll on company profits.
Turnover is also a factor. When employees are feeling unenthusiastic and underappreciated, they tend to leave. To replace an employee, a company can plan to spend between 16%-20% of the employee’s salary to recruit, hire and train a replacement.
How you can prevent it
The solution is to shift company culture to embrace and promote the use of vacation time. Maintaining a work-life balance is becoming increasingly important to today’s workforce, and vacations are a necessity. Supporting and promoting– even rewarding the use of vacation time will increase retention, as employees will want to stay at a company that recognizes and values their need for balance. It will also increase productivity, as well-rested employees return with increased creativity and focus.
Cross-training is essential to help employees feel comfortable using their vacation days. Investing the time and resources to cross train will have a long-standing payoff. Additionally, when others step in, they feel more valuable. Learning other skills can open up the opportunity for leadership and advancement.
Your employees are your greatest asset. Nextaff can help your business keep your very best talent productive and satisfied. Contact us today for more information.