How More Vacation Time Can Increase Productivity

By Glen Stansberry on 2 November 2010 0 comments
Photo: PeskyMonkey

In a previous article, I wrote about why Germans are more productive than Americans but still have more vacation time. While researching the article, I found plenty of examples of other countries that also kick the pants of Americans in terms of workplace productivity, despite taking more vacation and often working less hours.

We Americans pride ourselves on our hard work ethics, rooted deeply in our Puritan background. It could be argued that "hard work" is part of our culture and heritage, and deeply important to our identity as a culture — but if other countries have fewer working hours and longer vacations, and are producing the same or more than us, then our work process obsession might need to be reevaluated.

How the U.S. Ranks in Productivity

In 2009, the consulting firm Mercer ran a study to determine the most competitive countries based on their gross domestic product (GDP). In terms of competitiveness, the U.S. is still the best in the world. However, if you look a little closer at the numbers and compare them with other labor statistics, you'll find that the U.S. ranks below other countries in terms of gross domestic product per hours worked.

In layman's terms: We're not as productive as other countries that take longer vacations.

A 2009 study by Expedia found that the United States ranks last in vacation days with an average of 10 days a year. Here are a few successful countries that thrive while giving more vacation than the U.S. (data taken from a BusinessWeek article):


Finnish workers have an average of 40 vacation days a year and rank 6th on the Global Competitiveness scale.


French workers also have an average of 40 vacation days, and France is 98.2 percent as effective as the U.S. in terms of GDP per hours worked.


Austrians average 38 vacation days a year, and 35 work hours a week. Despite all the "downtime," they still rank 14th on the Global Competitiveness scale with an unemployment rate of 4.3 percent. (At the time of writing this piece, the U.S. is at 9.2 percent unemployment; it was at 9.4 percent when the BusinessWeek article was written.)


Swedes have 36 vacation days a year and are still ranked 4th on the Global Competitiveness scale.

What do these countries prove? While the U.S. is still king in terms of competitiveness (as of 2009), other countries where employees work fewer hours per week are still nearly as productive (if not more) than the U.S. while taking more vacation.

Take Belgium and the Netherlands. Data from the Organization for Economic Cooperation & Development shows that these countries mandate 30 and 28 vacation days a year, respectively, and are still 2 percent more productive than the U.S. Tiny Luxemborg dishes out 32 yearly vacation days and is a whopping 27 percent more efficient than the U.S.

The Cost of Not Taking Vacations

The evidence above proves that taking vacations is good for not only your sanity but also for the bottom line. Benefits like relaxation and rejuvenation are immediate effects of vacation. (I myself just came back from a cruise in the Bahamas with my wife and can vouch for these fantastic benefits.) However, there are more benefits to vacations than meet the eye.

When you take more vacations, you relieve stress. Stress is a major health issue for workers and has even been called the "New Tobacco" because of the physically damaging effects it creates for your body. Studies also show that men who don't take regular vacations are 32 percent more likely to have heart attacks than those who do, and women are 50 percent more likely to have heart attacks if they don't take vacations.

The recent recession might have a silver lining — researcher Dr. Stephen Bezruchka of the University of Washington School of Public Health believes that the recession and the rising unemployment rates have had a positive impact on American's health. According to Bezruchka, Americans are sleeping more, eating better (by not eating out as often), and spending more time with family. Even though one never wants to see unemployment as a benefit, it seems clear that working less has a direct and positive impact on overall health.

What about employees who have accrued vacation time, but don't take advantage of it? Expedia conducts a yearly study concerning vacation times, and in 2009 it found that 34 percent of Americans don't take all of their allotted vacation time. Not only is this a health factor (higher stress, etc.), but organizations who let employees' vacation times accrue might have to pay for those days upon termination, which could be quite costly to the organization.

As we Americans continue to find ways to become more connected with our work through technology, it might be helpful to look at how the "old" way of working could be beneficial: taking more vacation, leaving "work" for the workplace, and taking better care of our health.

After all, it is just a job.

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