A common pattern when working in teams: when one person is out on vacation, there’s a disproportionate drop in productivity for the team as a whole. Lots of things end up blocked on the person who’s out. For instance, in a small software team, maybe the developer who owns a particular API is out, and nobody else knows that API well enough to confidently make changes, so anything involving changes in that API ends up blocked until the owner is back. Or, even if someone else steps in to handle changes to the API, they’re much more likely to introduce bugs.

To some extent, we can structure teams to mitigate that kind of problem. “Everyone does everything” is very costly, but underrated. Weaker versions like “At least three people can cover any given thing” are also costly, but underutilized.

But there’s a much less costly strategy which gains a decent chunk of the same benefits: coordinate vacation. If everyone goes on vacation 3 weeks per year on the same 3 weeks, then that’s only 3 weeks of nonproductivity for the team; the other 49 weeks are full steam. If everyone on a 10-person team goes on vacation 3 weeks per year at different times, then that’s 30 weeks per year of disproportionate productivity-loss; the team is at full steam less than half the time.

Thus the case for national holidays: it’s not like everyone is required to get the day off (at least in the US), but it’s a Schelling point for lots of people to take a vacation at the same time. People get their much-needed recovery time simultaneously, so teams can spend more time working at full capacity.

But in practice, most people take a lot more vacation days than there are national holidays - which suggests that the current number of holidays is too small.

It seems like companies (or nonprofit orgs) could profit by filling that gap at the company level: declare official “company holiday” weeks, and offer incentives for employees to take their vacations during those weeks. Unlike national holidays, the company holidays won’t necessarily line up neatly with good vacation times for spouses/children/parents/friends. But on the upside, since a company holiday need not be at the same time as the rest of the country, traveling should be easier.

Expanding from there, one could imagine a few companies/orgs which need to interface with each other a lot coordinating their Schelling holidays. For instance, when I worked at a trading company, the usual rule was “if the markets aren’t open today, we’re not working today”.

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One big problem is the disparity between people with kids and those without - those with kids tend to take all their vacation days when school's out.

Those without kids spread theirs around the year so they get cheaper prices.

In practice this means things are very quiet during the summer/winter vacations and then there's a smearing of one or two people out each week for the rest of the year.

The company incentives would have to be more than the difference in prices for planes and hotels between on and off peak seasons - often thousands of dollars.

But there’s a much less costly strategy which gains a decent chunk of the same benefits: coordinate vacation. If everyone goes on vacation 3 weeks per year on the same 3 weeks, then that’s only 3 weeks of nonproductivity for the team; the other 49 weeks are full steam.

Isn't that what happens, de facto, in places like France, where the month of August is socially designated holiday month, and more or less every office worker takes their vacation at that time?

Finland too (and I expect quite a few other EU countries to do so as well)

Yup! Also I hear China does a pretty good job of having lots of coordinated holidays.

The holiday industry would have to have separate Schelling holidays.

I worked for a company that tried this one year: one week off in July and two weeks off around Christmas and New Years. About half the company loved it, the other half hated it.

The half that loved it liked that everyone else was off, so they felt like they had permission to disconnect. Other than a handful of people who had to work essential functions, everyone else was off for the week and didn't have to worry about what was going on back at the office and gave people a needed break.

The half that hated it disliked that they felt forced to take vacation at a time that didn't meet their needs, and so then they felt bad about taking additional vacation that impacted the team because they had been forced to take vacation at a time that wasn't useful to them. It was nice enough to get more time off, but didn't solve any of the problems you describe because the time off was still needed at other times.

We backed off and chose not to continue.

The main reason I think to have more coordinated time off is if people aren't taking enough time off. For example, my understanding is that in Japan people typically don't take their PTO, so the government and companies coordinate to have a large number of holidays when it's socially sanctioned to take time off.

I suspect this would cause more problems than it solves.  There are usually enough daily or on-demand tasks that at least a skeleton crew needs to be available always, and the nature of crowds and pricing is such that many people want to take vacation when others AREN'T.  And in-company coordination fails when people at different companies want to vacation together.  

Combine this with the general desirability of building businesses/teams that DON'T stop working when any one employee is missing, and the intent (even if not the execution) to remove those bottlenecks, and it's very difficult to stand up and say it's worth any inconvenience to reduce the impacts, instead of working to reduce the causes.

I've done this at a small startup before; it worked pretty well.

What about weekends? There are currently 104 days in a year where you're not supposed to work.

The big difference is that these days are uniformly distributed through the year, and aren't in a one or two week block.

FWIW, this post strikes me as a very characteristically 'Hansonian' insight.

'Hansonian' meaning it explores a change that is a funny departure from a current equilibrium, but doesn't explain why it's only that change which is possible, rather than changing an underlying inefficiency or a different dimension of the equilibrium?

Why have paid time off (or allowed time off) at all?  Why not bid for time off, with different multipliers depending on how many are out at once?  At the very least, why not measure the correlates of expense of time-off and adjust accordingly, rather than just the intuition that for some teams, one member missing has a disproportionate cost and that should be fixed by enforced scheduling.


Why not bid for time off, with different multipliers depending on how many are out at once?

Because for actual humans, doing so has huge transaction costs. I'm reminded of the reason why micropayments failed., except this isn't so micro.

It also makes you lose predictablity--you can no longer look at a number and know that you have exactly that many days.

Software companies usually want to be able to directly respond when a critical bug appears and not have to wait three weeks till everybody is back from holidays. 

A middle ground version of this happens (in the US) over the summer when almost all kids are out of school for 8 weeks between June 15 and Aug 15 (plus or minus), so families that can often take thier long vacations during that time.

On my 10 person team, that led to the entire 8 weeks having 1-4 people off.

Coinbase does a quarterly weeklong shutdown and everyone I spoke with there was deeply grateful for it.  We would sprint to the shutdown, try to get everything finished / to a reasonable stopping point, then reevaluate projects on the other side.

Matt Yglesias makes a very similar case for more holidays here, including some interesting references to literature about the benefits of weekends and etc: https://www.slowboring.com/p/happy-juneteenth-observed

Basically unrelated, but I really enjoy the niche rationalist holidays of the Solstices, and to a lesser extent Petrov Day, Giving Tuesday, etc. We ought to come up with more of these!

In Italy we have this, in the Ferragosto week (around the 15 of August) a huge percentage of people is on vacation. In general a lot of people take vacations in August and schools of all order and levels (including university) are closed the whole month.

you cite software. turnover in that industry tends to be pretty high, which means the successful companies end up with some structure where when any particular engineer leaves, their responsibilities are re-distributed quickly. so (1) if a team member is out for a week their most urgent responsibilities can already be picked up by their peers and (2) wherever this isn’t the case, the employer is likely to see that as a failure in need of fixing.

unaligned week-long holidays sort of serve as a dry run to ensure that things are set up such that when the employee on leave were to leave permanently things would still continue.

there’s another way to address this coordination, btw: ask that employees schedule their time away 2 weeks in advance: when the team plans the next chunk of work, sequence things such that this employee won’t be working on a blocking task near the interval where they’re away.

regardless, certain Schelling points do arise naturally. it’s far more common for someone to take individual Fridays off than it is to take Tuesdays off, for example. weekends themselves are some example of what you’re getting at: extending those (by occasionally adding Fridays or Mondays) seems an easy course to follow.

Any industry with public exposure is going to run into problems. Take retail; having the store open at all possible profitable hours is much more important than having a full complement of staff at any given moment. My job is only adjacent to retail but even so, having a whole team go on vacation would put the supply chain on pause. That move might technically be possible with advance planning but it would have major impacts on throughput.

I think any sector that relies on moving physical matter (including people) through space is a bad candidate because you're often dealing with a cap on the amount of effective capacity your capital has, so having a team of people go dark will lead to underutilization. Consider maintenance jobs, shipping, manufacturing, food, emergency services, transport, and I'm sure a dozen others.

But in practice, most people take a lot more vacation days than there are national holidays - which suggests that the current number of holidays is too small.

Wait, what? You're arguing that – from the business perspective – vacation days would be inferior to holidays. But now you're using that claim as an argument for itself.

And national holidays don't even involve the same trade-offs as company holidays (i.e. for infrastructure usage), so even if we accept that there should be more company holidays, maybe there is an optimal number of national holidays.