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Time off? How inflation and layoffs are threatening workers' vacation time

Summer vacation is a sacred time for most Americans.

So why is it in peril? A new study from ELVTR, an online learning platform based in Irvine, California, revealed that 55% of workers are either taking less time off or canceling vacation plans altogether due in part to recent layoffs.

“I think a lot of people are worrying [about losing] their jobs because there's a reason to actually worry about losing their jobs,” said Roman Peskin, co-founder of ELVTR. “I don't think that most Americans are in a situation [where] they are positioned to take risks.”

In May, ELVTR surveyed 2,300 workers over 18 years old (1,800 from the US and 500 from Canada, according to the study.) The study found that due to understaffing caused by recent layoffs, 37% of US workers are taking less time off and 20% will be missing out on vacation altogether.

Sacred time? Thirty-seven percent of US workers are taking less time off and 20 percent will be missing out on vacation altogether.
Sacred time? Thirty-seven percent of US workers are taking less time off and 20 percent will be missing out on vacation altogether. (Thomas Barwick via Getty Images)

Julia Pollak, chief economist at ZipRecruiter, who was not involved in the study, pointed out that such data has emerged despite job gains and economic recovery post-COVID.

She attributed the discrepancy to two explanations. The first, she said, was that inflation has diminished people's purchasing power and forced them to continue working through their usual vacation time.

“Since the pandemic, most workers have actually seen their real earnings decline, not increase after inflation. And so, people feel some degree of financial pressure to keep working and not to take time off,” Pollak said.

Workers have also lost negotiating power with their employers in the last year, she said.

“Workers had tremendous leverage between the end of 2021 [and] sort of mid-2022, when the entire economy was restaffing at once and there was very, very fierce competition and the threat of quitting caused employers to do all kinds of things to play ball and get them to stay,” Pollack said. “But it's now becoming a bit easier with the COVID recovery and labor force participation for employers to find workers.”

Meanwhile, those who take time off rarely enjoy a genuine break — about 68% say they work while on vacation, according to the study. The study revealed that 46% “struggle to switch off” while on vacation. Another 57% “get anxious if they don’t check their work emails.”

Also, a quarter of workers admit to “disrupting colleagues during their vacation.”

“It becomes a socially acceptable thing to do,” said Peskin.

Tired and stressed businessman working with a laptop at home. Home office and freelance concept.
Tired and stressed: Working on vacation is neither good for the employee nor the employer. (Getty Images) (juanma hache via Getty Images)

What's the impact of this behavior? The study showed that 45% of workers have upset “their partners or travel companions” by working on vacation. Also, there's a toll taken on the workers themselves.

“Psychological destruction, mental destruction — that's what it is,” said Peskin, “Those who do take vacation and continue doing work, not voluntarily but because they are worried about losing the job or worried about letting down their colleagues, … I think it's very worrisome.”

Pollak said that diminished or absent vacation also impacts companies. She pointed out that workers frequently cite burnout as one of the main reasons why they quit their jobs.

“Companies are often really left in the lurch when workers disappear after the huge investment they've made in their training and everything,” she said. “So, it would probably be better for companies if they gave people a vacation, rather than burning them out and seeing them leave with little notice.”

Dylan Croll is a Yahoo Finance reporter.

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