Want to offer unlimited PTO? Sounds nice, but perk seems to be losing luster

Once considered an almost irresistible perk, unlimited paid time off (PTO) is seeing a significant drop in popularity. When it first came on the scene, it seemed like a win-win for employees and employers alike. Employees saw a solution to work/life balance issues, and employers saw a way to entice recruits with an attractive benefit (not to mention a clever way to avoid paying out accrued leave). So, why the change?

Statistics tell a story

The Indeed Hiring Lab reported in July that its data shows declining popularity of unlimited PTO. The report notes that as of June, just 2.9% of U.S. Indeed job postings offered unlimited PTO. That’s down from 8.8% in March 2022.

Even though both employers and employees find a lot to like about the concept of unlimited time off, some find it’s not as appealing in practice as it sounds.

Many employees who were comfortable taking time off work when they had a set number of days feel pressured to stay on the job under an unlimited policy. They worry they’ll be seen as lazier or not as dedicated as employees who don’t take much, if any, time off.

Employers also see a downside, as workers who are hesitant to take time off suffer burnout and, as a result, lower productivity.

Pros, cons, and what it means