Why Vacation Matters More Than We Thought: New Research on the Lasting Impact of Time Off

By Dr Dawn H Nicholson

We’ve long known that taking time off work is good for our health. But just how good – and how long the benefits last – has been less clear.  

Previous studies suggested the effects of vacation on employee wellbeing were modest and short-lived. Meanwhile, evidence suggests many employees are taking fewer breaks. In the U.S. alone, 768 million vacation days went unused in 2018 – a loss of $65 billion in benefits (U.S. Travel Association, 2019). 

These findings also seem to correlate with a trend for increased work-related stress. The UK Mental Health Foundation previously estimated there were 875,000 UK workers suffering from work-related stress, depression or anxiety, resulting in 17.1 million lost working days in 2022-23. Poor mental wellbeing costs employers in the UK an estimated £42 - £45 billion annually through presenteeism, sickness absence, and staff turnover. Understanding the true impact of vacation breaks on wellbeing could play an important role in reversing this trend. 

New Research on the Benefits of Vacations 

New research led by the University of Georgia and published earlier this year may offer valuable insights. The researchers undertook a detailed examination of previously published research into the link between vacations and employee wellbeing, using a meta-analytic approach to summarise data drawn from 32 studies, including 256 effect sizes (Grant et al., 2025). The results suggest that the benefits of vacation may have been underestimated and that vacations present a real recovery opportunity for employees, having a significant positive effect on their wellbeing. 

The Theoretical Background 

Two key psychological theories underpinned the research:  

• The Effect Recovery Model (ERM): (Meijman & Mulder, 1998)  
• The Conservation of Resources Theory (COR): (Hobfoll, 1989) 

According to the ERM, work demands require daily effort from employees, which activates their psychophysiological systems. The constant, repeated exposure to such demands means that these systems remain in a state of high activation, which can lead to physiological symptoms such as stress hormone release and increased heart rate, as well as psychological symptoms like fatigue and low mood. Employees require a break from their stressful work demands to allow their psychophysiological systems to recover. 

COR theory focuses on employee recovery through restoring, rebuilding and maintaining resources. There is a need for replenishment of personal resources like energy and positive mood, which can be achieved through leisure activities such as playing sport and socialising with friends. These resources can also become self-fulfilling: 'If I can recover by relaxing on the beach, then I may have more energy for a bike ride or hike, which could, in turn, increase my potential to achieve more resource gains.' Failure to restore these lost resources can lead to poorer health, reduced wellbeing and impaired performance.  

In summary, vacation provides the perfect time for individuals to be free from the demands of work (ERM), whilst taking active steps to restore and replenish their personal resources (COR).  

The Findings 

By combining and analysing the results from their meta-analytic review, the Researchers concluded the following: 

1. Wellbeing improved significantly when comparing before and after the vacation, and the effect was larger than previous studies suggested.
2. There was a ‘fade-out effect’ – with wellbeing decreasing on return to work – but at a much slower rate than previously believed. This means that the positive benefits of vacation last far longer than had been thought in earlier research. 
3. A mix of ‘home and away’ vacations seemed to provide a greater positive effect on wellbeing than just ‘away’ vacations. 
4. Longer vacations can lead to larger wellbeing effects during vacation, however, the ‘fade-out effect’ is steeper and faster – largely due to a greater build-up in work associated with longer vacations and the shock of returning to the working environment. 
5. How you spend your vacation also matters. Lying by the pool dealing with emails does not cut it. It’s important to disconnect completely from work to achieve the greatest recovery.  
6. Undertaking physical activities has the greatest possible impact on wellbeing recovery, followed by social activities. 
7. Culture can also play a role, with those from high-performance-orientation cultures – those rewarding innovation, high standards and performance improvement – experiencing greater wellbeing benefits during vacation but a quicker decline on returning to work. (Low-performance-orientation cultures value quality of life, societal/family relationships and belongingness).  
8. The number of national holidays a country offers can also impact wellbeing when combined with vacation time. The more national holidays there are (bank holidays, etc.), the greater the increase in wellbeing benefits from vacation, but the greater the decline in wellbeing after returning to work. 

Organisational Implications 

This new research underscores the importance of vacation when it comes to employee wellbeing. Business Psychologists have a critical role to play in helping organisations better understand this and translate it into actionable policies.  

Vacations are important for two reasons:  

1. To help you escape from the daily demands and stress of work 
2. To replenish and restore your personal resources 

That said, it’s important to consider how you spend your vacation. Opportunities to completely disconnect offer the greatest benefits to employee wellbeing – not easily achieved in today’s ‘always on’ culture. But this research suggests that longer breaks, with some physical activity and sustained detachment, provide employees with the greatest ability to recover their wellbeing. So, switch on the ‘out-of-office’ and ensure your work colleagues – and you – respect it. 

About the Author 

Dr Dawn H. Nicholson is Vice Chair of the ABP and Head of University Accreditation, with almost three decades of HR and consulting experience and a PhD in Decision-Making Psychology. A Chartered Psychologist and ABP Fellow, she has led Business Psychology programmes at Kent and Arden universities and remains active in the Business Psychology industry. As Biz Psych Cup Lead, she champions collaboration between academia and business. Passionate about guardianship and growth of the field, Dawn works to raise standards, support emerging talent, and promote the value of Business Psychology. She also enjoys countryside walks with her two lively cocker spaniels. 

References 

Grant, R. S., Buchanan, B. E., & Shockley, K. M. (2025). I need a vacation: A meta-analysis of vacation and employee well-being. Journal of Applied Psychology, 110(7), 887–905.

Mental Health Foundation.  

U.S. Travel Association. (2019). Paid time off trends in the U.S. 

Meijman, T. F., & Mulder, G. (1998). Psychological aspects of workload. In P. J. D. Drenth, H. Thierry, & C. J. de Wolff (Eds.), Handbook of work and organizational: Work psychology (2nd ed., pp. 5–33). Psychology Press/Erlbaum (UK) Taylor & Francis.

Hobfoll, S. E. (1989). Conservation of resources: A new attempt at conceptualizing stress. American Psychologist, 44(3), 513–524.