May 3, 2024 - Economy

Gen Z helps fuel rise in sabbaticals

Illustration of a switch with a briefcase icon, shifting from on to off.

Illustration: Allie Carl/Axios

More companies and workers are offering and taking sabbaticals, according to data from Gusto, a payroll platform.

Why it matters: A still-tight labor market, remote work and Gen Z expectations are all driving the trend, Gusto chief economist Liz Wilke tells Axios.

State of play: The share of workers likely on a sabbatical — defined by Gusto as someone who is off for three weeks or more during a prior two-month period — rose from 3.3% in January 2019 to 6.7% as of January this year.

  • The trend among Gen Z was even more pronounced: a jump from 1.7% to 8%. (See below.)
A line chart that shows the share of workers likely on sabbatical generally increased in the period January 2019 to January 2024. Two lines represent 22- to 26-year-olds and overall workers. Both lines show a similar trend with peaks in December and January each year, reaching a maximum of 8% for 22- to 26-year-olds and 6.7% overall in January 2024.
Data: Gusto; Note: Includes salaried employees with over 120 hours of paid vacation leave during the prior two months; Chart: Axios Visuals

What they're saying: "Gen Zers are taking a lot more advantage of that benefit because they really value work-life balance," says Wilke.

  • Simultaneously, older workers continue to change the way they think too, and Wilke expects there will be "increased demand and acceptance" of sabbaticals.

The big picture: Employers with less scale and capital to woo workers than the Walmarts of the world are "trying to respond in ways that they can," which is why Wilke says smaller businesses are offering the perk.

  • And for workers — particularly remote workers — who struggle with feeling like they can't or shouldn't take vacation, sabbaticals take some of that pressure off because the "company basically decides that [they] take the time off instead," she adds.

The intrigue: For businesses, "paid time off and sabbaticals are not interchangeable solutions," Tamekah Ebanks, Gusto's head of benefits, adds.

  • Sabbaticals are often granted to recognize and reward tenure and that could be a crucial way for companies to address turnover concerns.

💭 My thought bubble: I just got back from a two-week sabbatical, which Axios awards after three years.

  • Normally, I struggle with asking for and taking time off, but this was different: It felt celebratory, and I feel lucky to work for a company that considers the value of time-off rewards.
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