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What Is The Average Vacation Time for Small Businesses?

average vacation time for small businesses

When starting a small business or considering working for one, it is important to consider the average vacation time for small businesses. This average can depend on lots of factors but the most common is years of service. Depending on how long an employee has worked for your business often determines the average vacation time.

Although offering paid vacation time to your employees is not required by law, the majority of companies do. According to the Bureau of Labor Statistics (BLS), 76% of private industry workers receive paid vacations. Offering vacation time for small businesses can make your company more competitive and decrease employee turnover. Many small business owners, specifically those who are new employers, struggle to create a vacation policy that is fair and reasonable for their employees. When determining your standard vacation policy, consider the average vacation days per year businesses nationwide provide.

Years of Service

The average vacation time for small businesses depends on an employee’s years of service. The average vacation time is based on how many years an employee works for your small business. The average paid vacation days per year for employees who have been with a business for 1-5 years is 10 days. 

Employees who have been with a business for 5-10 years receive an average of 15 days for vacation. The average number of vacation days employees who have worked at a business between 10-20 years receive is 17. Finally, employees who have been at a business for 20 or more years receive an average of 20 vacation days. 

A more detailed breakdown of the average vacation gives the exact percentage:

1-5 Years of Service
  • 0-5 paid vacation days (7%)
  • 5-9 paid vacation days (38%)
  • 10-14 paid vacation days (35%)
  • 15-19 paid vacation days (12%)
  • 20-24 paid vacation days (7%)
  • 24+ paid vacation days (2%)
5-10 Years of Service
  • 0-5 paid vacation days (2%)
  • 5-9 paid vacation days (9%)
  • 10-14 paid vacation days (36%)
  • 15-19 paid vacation days (34%)
  • 20-24 paid vacation days (12%)
  • 24+ paid vacation days (6%)
10-20 Years of Service
  • 0-5 paid vacation days (2%)
  • 5-9 paid vacation days (7%)
  • 10-14 paid vacation days (16%)
  • 15-19 paid vacation days (41%)
  • 20-24 paid vacation days (22%)
  • 24+ paid vacation days (13%)
20+ Years of Service
  • 0-5 paid vacation days (2%)
  • 5-9 paid vacation days (6%)
  • 10-14 paid vacation days (13%)
  • 15-19 paid vacation days (20%)
  • 20-24 paid vacation days (35%)
  • 24+ paid vacation days (25%)

Choosing the Average Vacation Time for Your Small Business

You can use the average number of vacation time when coming up with your standard vacation policy for your small business. You can also use it as a guide for developing a policy that fits your business. Keep in mind that the average vacation days by industry may vary. Not all industries offer the same number of paid vacation days. 

When creating your vacation policy, you may need to come up with additional rules. Here are a few examples of conditions you might want to establish in your business’ vacation policy:

  • Employees must give you a number of days/weeks notice before taking paid vacation
  • Employees cannot take off more than a number of days at a time
  • No more than a number of employees can take off the same day 
  • Employees may cash in a number of unused vacation days for money at the end of the year
  • Employees may only carry over a number of days from year-to-year
  • Employees must use paid vacation days or lose them at year-end (unless your state bans use-it-or-lose-it policies)

Your small business might choose to lump vacation, sick, and personal days under one paid time off policy. With a paid time off policy, your employees have a fixed number of days they can use for any personal reason. Now, you may be wondering is vacation time the same as paid time off, or PTO. 

The best way to think about it is that vacation time PTO while PTO is not always vacation time. This means that PTO is an umbrella term for any time an employee takes away from work that your employer pays for. Other forms of PTO include maternity/paternity leave, jury duty, sick leave, holiday pay or disability leave. Whatever you decide to do, add your policy into your employee handbook.

Create Your Vacation Policy with Canal HR

You don’t have to create your employee vacation policy benefits alone. At Canal HR, we work with you to equip your small business with an overall benefits package that suits all of your employees. There are many intricate details that come with providing different employee benefits—and benefits in general. If you want to provide your employees with fair and reasonable vacation days without the hassle, contact us today to schedule a free consultation.