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AP Photo/Carolyn Kaster
The standard two-week vacation policy looks increasingly outdated.
PEAK PERK

The share of US job posts offering unlimited vacation is up sharply

By Michelle Cheng

Unlimited vacation is becoming a less unusual perk in the modern workplace. With technology enabling more jobs to be “on” 24/7 and employees placing greater value on work-life balance, the standard two weeks of vacation in the US is starting to sound outdated.

The US does not have a great track record on paid leave. It is the only wealthy country that does not require private employers to offer vacation time to its employees. To put that into context: The minimum number of days off workers receive in the UK is 28 days, while in France it’s 25 days (and that’s not including holidays).

A new report from jobs site Indeed highlights that the share of job postings advertising unlimited vacation is rising fast. US job postings with open/unlimited vacation or paid time off rose from about 450 postings per million in May 2015 to nearly 1,300 postings per million in May 2019, up 178%.

Not surprisingly, the perk is most commonly found in the tech sector. Jobs for software engineers and data scientists, who are in high demand, are around six to eight times more likely than jobs in other occupations to offer unlimited vacation. But non-tech employers are increasingly starting to offer unlimited vacation policies: In May 2015, the non-tech share of “unlimited vacation” job postings was 61%. By May 2019, it had risen to 65%.

In a tight US labor market where employers are drumming up benefits from dog-friendly offices to comprehensive family leave, unlimited time off can be an attractive perk to recruit and attain talent of all ages. In addition to enabling more flexibility for workers, the policy can improve workplace culture and boost employee morale. While studies show that working overtime can lead to poor work performance and decreased health, unlimited paid vacation may be part of the fix. 

But even as more companies including Dropbox and General Electric adopt unlimited vacation policies, the unspecified nature can create some unintended consequences. For instance, if workers can’t accrue unused vacation time, employers aren’t obliged to pay it out. There’s also the risk of some people taking less time off than they otherwise would have. A 2017 study from HR software company Namely found that US employees with unlimited vacation plans take an average of only 13 days off per year, whereas employees in a traditional plan average 15 days annually.

Still, unlimited vacation is a rare benefit found mainly among high-growth companies and salaried workers. Only 0.13% of US job postings, or just more than one in 1,000, had terms like “open PTO” or “unlimited vacation” in the job description. Even among tech job postings, only 0.9% of the total listed unlimited vacation as a benefit.