Ezra Klein points to a chart showing that the United States is the only OECD nation that doesn’t legislate any vacation. “That’s our country. Aren’t you proud?” he asks sarcastically, assuming that we should automatically be outraged by such a finding. But he doesn’t offer any argument as to why it should be the role of government to force private employers to offer paid holidays to workers. This is a fundamental disagreement as to the function of government, so I’ll move on to a few practical points.
Measuring only the number of legislated paid vacation days provides us with an incomplete picture of how many paid vacation days Americans have in reality. While the government doesn’t mandate that employers offer certain paid vacation days, there are 10 federal holidays. I don’t have the exact statistics in front of me, but I don’t think I’m going out on a limb to say that lot of people tend to get off for most of those days, and a certain portion of them are paid. This doesn’t take into account general paid vacation and personal days offered in many employment contracts. In other words, the fact that other countries mandate what we make voluntary may mean that the rest of the world takes more vacation, but it doesn’t mean that we get zero paid vacation days.
Obviously, there are workers who do not get any paid vacation days, so the question is what would the economic effects be of mandating that they do? Shifting a percentage of the population from work to leisure would reduce economic activity, which would hinder growth. Employers would be faced with the prospect of paying the same amount of money to employees, and getting less out of them. How would they respond? Perhaps they would find ways to either reduce wages, or limit future wage increases. If they don’t change wages at all, then it could put inflationary pressure on the economy because worker productivity would be decreasing relative to wages, and thus the same amount of money would be chasing fewer goods and services. Some people would argue that it would be worth the tradeoff, but it’s always worth keeping in mind that there’s no such thing as a free vacation.