More Workers on Vacation Shows Better Job Market: BGOV Barometer
The number of U.S. workers on vacation has risen by the most since 2006, a sign of an improving labor market as more Americans have sufficient income and job security to take a few days off.
The BGOV Barometer shows there were 2.7 million people on vacation during April, based on the Labor Department’s monthly survey of employment conditions. The 12-month average was up 4 percent, the biggest jump since 2006, before the deepest recession since the 1930s threw 8.8 million Americans out of work.
As the U.S. unemployment rate has declined to 8.1 percent last month from 10 percent in October 2009, more people have jobs to take vacations from, and have held them long enough to earn days off. Confidence in those jobs and the additional disposable income they provide also make workers more willing to take vacation days.
More workers on vacation is a “little sign” of growth and shows that Americans are feeling more comfortable about the economy, said Joel Naroff, president of Naroff Economic Advisors Inc. in Holland, Pennsylvania.
“For a long time they had been too concerned about losing their jobs,” Naroff said. “Taking vacations, sick days, they tended not to do those.”
Increased confidence should also put employers on notice that workers may be growing less fearful of losing their current jobs, Naroff said.
Warning to Employers
“Businesses have had it pretty good for the past few years as workers have been concerned about losing their jobs and have been taking everything that businesses have been willing to dish out,” Naroff said. “It’s a warning sign that when things get a little better, the turnover could be enormous.”
Days off are up for 2012 even before next week’s Memorial Day holiday, the unofficial start of summer vacation season. AAA estimates 34.8 million people are projected to travel more than 50 miles in the U.S. for the holiday.
The 2.7 million workers off last month were almost double the 1.41 million on vacation in April last year, according to the Bureau of Labor Statistics. The vacation total for April 2012 is the most for any month since 2007, excluding the peak vacation months of June, July and August.
“This strikes me as unequivocally a good sign,” said Jared Bernstein, a senior fellow at the Center on Budget and Policy Priorities and former chief economist for Vice President Joseph Biden. “It’s a leading indicator that folks are feeling confident enough to take more vacation time.”
Whether traveling for vacation or staying local, people are more likely to spend money when away from the workplace, said Bernstein. Demand for food, lodging, transportation or other activities is needed for job growth, he said.
“If consumers are sitting on their hands, we will be stuck in an economic slog,” Bernstein said.
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