The Hidden Costs Of The Summer Slump

Between Memorial Day and Labor Day, offices all over the country get quieter as people go on vacation. But in addition to planned vacation, plenty of workers see the sunshine as a reason to call in sick to work. As many as 39% of full-time employees admit they feigned illness to take a paid day off to enjoy the weather, while 72% of respondents to an SHRM survey noted higher rates of unplanned absences on Mondays, Fridays, before public holidays, or before sporting or national events.

While most companies chalk it up to the cost of doing business, there is evidence that it hurts the bottom line. The same SHRM study found that the average productivity loss for unplanned absences was 36.6% and the annual cost of all paid time off (vacation or sick days) ranged between 20.9% to 22.1% of overall payroll. 

John Schwarz, Founder and CEO of Visier, a workforce analytics company, says although it is easy to make gut-feeling assumptions about what drives workers to absenteeism, in most situations, it’s a more personal issue. “Poor local management, a job that is much more difficult during hot weather, children out of school for the summer holidays, a spouse who needs the car to go somewhere, etc.,” he explains.

Schwarz believes it’s best to analyze the characteristics shared across a particular staff. Factors that could contribute to unplanned absences include:

• length of tenure
• time since last promotion
• managers span of control
• location
• generation
• recruiting source
• performance level
• amount of training
• absences in the previous year

A shorter time on the job can increase the chance the employee will call in sick, as will training for less than 20 hours, for example.

But Schwarz underlines that there isn’t one department or area of businesses in general that are more likely to take unplanned absences, it depends on the company. He does say that a rise in workers calling in sick could point to an overall lack of engagement.

“Satisfied and engaged employees are less likely to abuse the company’s sick policy,” he says. But it’s not enough to just do a head count. Schwarz says managers should compare absenteeism between different teams, departments, locations, and performance levels to determine whether there are more people taking leave during the summer months. Then, he recommends looking to see if one manager has a larger degree of absenteeism than another.

On the flip side, another productivity and profit suck could come from vacation time. But not how you think.

A recent Randstad survey of over 2,200 full-time workers revealed that 42% feel obligated to check in at work while on vacation and feel guilty for taking all their allotted time off, 67% reported feeling more productive after returning from vacation. 

Staying connected (and cleaning out the email inbox) might make workers feel less stressed during vacation and after they head back to the office, but Schwarz cautions that such “workcations” can lead to burnout, a decrease in morale, increased absenteeism, and attrition.

“We know that increasing the amount of work generally does not lead to increased productivity,” Schwarz says, citing findings from the Organization for Economic Cooperation and Development. Measuring productivity compared to hours worked per week in Germany and France, countries with much more generous vacations and somewhat shorter work weeks, revealed that while they work on average about one-fifth fewer hours, they are only one-eighth less productive than the U.S., he says.

Schwarz says it’s possible to find evidence of “workcation-related stress” by looking to see if there is a relationship between absenteeism and a particular manager. “If people feel they are required to work on vacation because the boss is always watching, it can show up in more absence days,” he says. It also shows up in engagement scores and resignation rates. “These are signs that a particular group is not really getting the time off they need,” Schwarz adds.

It’s up to HR to drive productivity by ensuring vacation time actually happens, according to Schwarz, to make sure that staff gets a chance to recharge their batteries. Otherwise, he says, the old adage, “All work and no play makes Jack a dull boy” holds true. But it also dings the bottom line in a measurable and negative way.