22% Fewer Employers Hosting Holiday Parties

While the economic recovery failed to make great strides in 2011 and, in fact, appeared to stall in the second half of the year, nearly 70 percent of companies still plan to hold holiday parties in the coming weeks, according to an annual survey of human resources executives conducted by global outplacement firm Challenger, Gray & Christmas, Inc.

The percentage of companies hosting parties is about the same as a year ago, but remains well short of a pre-recession 2007, when about 90 percent of companies surveyed held holiday festivities.

The non-scientific survey of approximately 100 human resources professionals found that the overwhelming majority of companies holding parties (95 percent) are budgeting about the same amount for their events as a year ago.

“The economy is not improving as fast as many had hoped. While some companies are seeing improvements, most are still stuck in first gear and continue to hold off on hiring, equipment upgrades and other big expenditures. Yet, despite the less-than-celebratory business conditions, the majority of companies refuse to abandon the year-end holiday party,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

“For many employers, the holiday party is a way to demonstrate appreciation for employees’ hard work throughout the year. Others see the parties as a relatively low-cost morale builder. For smaller companies, the holiday party is simply an extension of a more family-like relationship that often exists between these employers and their employees,” said Challenger.
“The nice thing about holiday parties is that they do not have to be full-blown extravaganzas to be meaningful to employees. A small company on a tight budget can easily host a potluck lunch, where employees bring in a favorite dish to share with co-workers,” he added.

Only about 30 percent of companies surveyed are holding their parties on company premises. That is down from 53 percent of companies that did so a year ago. Sixty percent of companies are limiting attendance to employees only, perhaps excluding spouses or significant others in an attempt to save on cost. More than half (55 percent) are holding the party during the workday or near the end of the day.

“The most surprising finding of the survey was that about half of the respondents said their companies would be serving alcohol at their holiday parties. In addition to the added cost, serving alcohol adds a level of risk that most companies should strive to avoid. However, despite the increased cost and risk of including alcohol, many companies still embrace it as part of the festive atmosphere,” noted Challenger.

“For workers whose companies are holding parties this year, particularly those where alcohol is available, it is important to remember that there is a fine line between having fun and having too much fun. The economic recovery is still very fragile, so it is not the time to draw attention to oneself with embarrassing conduct at the holiday party,” said Challenger.

“However, employees should not simply stand in the corner in an effort to stay off the radar. It is equally important to remember that these events also offer great opportunities, such as socializing with senior executives who you do not interact with on a daily basis. Make an effort to break away from your comfort zone and introduce yourself to those who might help your career,” he advised.