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Bureau of Labor Statistics > Employer Costs for Employee Compensation > Home

Paid Time Off: Measuring the cost of paid leave benefits

When observing overall employee compensation, it is important to consider not just the costs of wages and salaries but also the costs of providing various benefits. Aside from wage data, the Employer Costs for Employee Compensation (ECEC) provides detailed benefits cost data for a more comprehensive look at overall compensation. The ECEC provides the employer cost of a specific benefit as well as the percent of total compensation that the benefit represents.

Different types of paid leave benefits

Paid leave benefits cost employers on average $2.94 dollars per hour in September 2022, representing 7.4 percent of total compensation costs. The cost of paid leave is calculated by multiplying the total leave time used by the rate at which the employee was paid during the used leave time.

Paid leave includes a combination of four leave benefits, as shown in Chart 1. Vacation leave (3.8%), holiday leave (2.2%), sick leave (1.0%), and personal leave (0.4%) benefits, as a percentage of total compensation sum to paid leave (7.4%). Paid leave benefits accounted for 25.1 percent of the costs of total benefits.

Chart 1 data table

Table 1. Leave benefits as percent of total compensation, private workers, September 2022
Benefit type	Percent of total compensation
Total benefits	29.5
Paid leave	7.4
Vacation	3.8
Holiday	2.2
Sick leave	1.0
Personal leave	0.4
Source: U.S. Bureau of Labor Statistics, National Compensation Survey

Paid personal leave

Personal leave is a general-purpose leave benefit, not otherwise provided by other forms of leave. Some employers place restrictions on the purposes for which personal leave may be used.

Paid holidays

Holidays are days of special religious, cultural, social, or patriotic significance on which work and business ordinarily cease. Employees usually have these days off from work and may receive either full or partial pay for holidays. The NCS captures the entire set schedule of holidays offered by an establishment, even if some holidays are not provided every year. Therefore, when part of an establishment’s set schedule, holidays such as Presidential Election Day or Inauguration Day are included, even though they are only observed every four years. Similarly, holidays that are part of the set schedule are included even when they fall on a non-workday (e.g., Saturday, Sunday) in a given year, regardless of whether the employer provides an in lieu day or payment for the missed holiday.

Paid sick leave

Sick leave is paid absence from work if an employee is unable to work because of a non-work-related illness or injury. The employer usually provides all or part of an employee's earnings. Employees commonly receive their regular pay for a specified number of days off per year. Sick leave is provided on a per-year basis, usually expressed in days, and is never insured.

Paid vacations

Vacations are leave from work (or pay in lieu of time off) provided on an annual basis and normally taken in blocks of days or weeks. Paid vacations commonly are granted to employees only after they meet specified service requirements. The amount of vacation leave received each year usually varies with the length of service. Vacation time off normally is paid at full pay or partial pay, or it may be a percentage of employee earnings.

Trends in paid leave benefits

Among different occupational groups in private industry in September 2022, employer costs for paid leave benefits (per hour worked) varied. Employer costs for paid leave benefits averaged $0.86 for service workers and $7.50 for management, business, and financial workers. The average among all private industry workers was $2.94. (See chart 2.)

Chart 2 data table

Table 2. Employer costs for paid leave benefit (per hour worked) by occupational group, private workers, September 2022
Occupational group	Cost for paid leave benefit
Management, business, and financial occupations	$7.50
Management, professional and related occupations	$6.24
Professional and related occupations	$5.54
Installation, maintenance, and repair occupations	$2.70
Natural resources, construction, and maintenance occupations	$2.19
Transportation and material moving occupations	$2.17
Office and administrative support occupations	$2.15
Production, transportation, and material moving occupations	$2.06
Sales and office occupations	$1.96
Production occupations	$1.94
Construction, and extraction, farming, fishing, and forestry occupations	$1.72
Sales and related occupations	$1.71
Service occupations	$0.86
All workers	$2.94
Source: U.S. Bureau of Labor Statistics, National Compensation Survey

In September 2022, private industry employer costs of paid leave benefits averaged $3.79 for union workers and $2.86 for nonunion workers. Vacation leave accounted for 3.6 percent of total compensation for union workers and 3.8 percent of total compensation for nonunion workers. While paid personal leave accounted for 0.3 percent of total compensation for union workers and 0.4 percent of total compensation for nonunion workers. (See chart 3.)

Chart 3 data table

Table 3. Cost of compensation (cost per hour worked) by bargaining status, private workers, September 2022
Leave type	Union	Nonunion
Vacation	$1.94	$1.47
Holiday	$1.10	$0.86
Sick leave	$0.58	$0.38
Personal leave	$0.17	$0.16
Source: U.S. Bureau of Labor Statistics, National Compensation Survey

Accessing the data

To assist users in evaluating the reliability of these compensation costs, relative standard errors are also published for each estimate. The standard error for the series is divided by the cost estimate and expressed as a percent of the compensation cost.

ECEC data involving leave benefits, are available for private industry workers, civilian workers, and state and local government workers from 2004 to the present and will be produced for the March, June, September and December reference periods. ECEC data is available through the public database, as well as in Excel form. The cost of benefits is impacted by worker participation and users can obtain information on incidence and provisions of employer-sponsored benefits in the U.S. through the annual benefits publication, also produced by the National Compensation Survey program.