Getting employees to take full advantage of their paid time off has long been a thorn in HR’s side—one exacerbated by the COVID pandemic and the rise of remote and hybrid work. But new data highlights just how pervasive an issue unused PTO has become, and how it could be a major red flag for costly employee wellbeing issues.

In its survey of 1,000 working Americans, Clarify Capital found that workers leave six days of PTO on the table each year. The top reason? About 44% of workers said they are socking their PTO away “just in case.”

“Right now, PTO is increasingly being treated as a form of job insurance,” says Michael Baynes, CEO and co-founder of Clarify Capital.

Hoarding PTO as ‘self-preservation’

The influence of AI on the workplace, and its increasingly visible link to mass layoffs, has workers on edge—and unused PTO is one signal.

“Employees are seeing headlines about layoffs and AI disruption, then instinctively holding onto time off as a buffer,” says Baynes, who suggests many workers are likely hanging onto time off to use for possible job searches, as well as other reasons like caregiving or a “worst-case scenario” crisis.

“Time off is becoming more and more about self-preservation,” Baynes says.

Apart from uncertainty, the research found that the next top concern is financial costs. For instance, employees say they don’t have enough financial security to cover a vacation. Other top reasons were related to workload, including having no one to cover their responsibilities, the fear of falling behind at work and feeling guilty about being away.

One major influence on the reasons workers are leaving PTO on the table is the industries in which they work. For instance, educators mostly avoid using all of their PTO because of guilt, while healthcare workers are more likely to cite worker shortages.

Driving trust, culture to encourage PTO use

Regardless of the reason employees aren’t claiming their PTO, the phenomenon points to a larger breakdown in trust between employees and employers, Baynes says.

“If people believe stepping away will hurt their standing or make them seem replaceable, they’re reading between the lines of company culture,” he says.

While only about 8% say their organizational culture actively discourages employees from taking time off, many aren’t being proactive enough to actually encourage PTO use, which negatively impacts psychological safety.

“When taking time off seems risky,” Baynes says, “employees don’t fully trust that their employer will support them in their absence.”

HR should work to help the company transform how it thinks about PTO, transforming it from a passive policy to an actively managed behavior. This involves top-down leadership modeling, holding managers accountable for how much PTO their direct reports take and designing workflows to naturally accommodate employees taking time off.

Ensuring work can be handled in someone’s absence—and actively planning for such occasions—can help workers feel more comfortable disconnecting, he says.

“The most effective organizations treat PTO like any other performance metric,” Bayne says. “They normalize it and build systems that make unplugging possible.”

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