41+ Average Bonus Statistics, Facts and Trends [2024]

December 19, 2023 0 Comments

Are you excited about the holiday season? 

Eagerly awaiting your Christmas bonus?

Majority employees expect holiday bonuses and many employers offer them.

Find out who receives the biggest average bonus and other important statistics.

Top Average Bonus Statistics – Editor’s Pick

  • In 2022, 46% of business owners provided Christmas bonuses. [12]
  • 40% of employees in the private sector receive some form of bonus. [1]
  • Women’s bonus values tend to be 68% lower than men’s. [2]
  • 33% of all companies plan to offer year-end bonuses to their employees. [3]
  • The private sector offers 2 times as many bonuses as the public sector. [7]
  • Since bonuses are a form of supplemental income, they are taxed higher than regular income. [8]
the private sector offers 2 times as many bonuses as the public sector

How Many Types of Bonuses are There?

Companies offer different kinds of bonuses depending on their profits and productivity.

Some organizations rely on referral bonuses, while others prefer cash payments based on profit sharing. 

These statistics explain which kinds of bonuses are most common and who receives them.

  • According to the US Bureau of Labor Statistics, 11% of employees receive end-of-year bonuses. [1]
  • Holiday bonuses were given to 6% of employees and 7% received cash profit sharing in 2020. [1]
  • 24% of employees received a Christmas bonus in 2022. [12]
  • 51% of business owners plan to award a Christmas bonus in 2023. [12]
  • Referral bonuses are popular with employers, with 82% of employers relying on referrals for recruitment. [4]
  • 45% of employees recruited through referrals stay with the company for more than 4 years. [4]
  • On average, a referral bonus amounts to $2500, and 6% of employees received it in 2020. [4]
  • 15% of companies offer non-monetary benefits to employees for referrals. [4]
  • 3% of workers receive employee recognition bonus and 1% qualify for longevity bonuses. [1]
  • Signing bonuses are usually a flat amount offered to all new employees or a salary percentage ranging from 5% to 25%. [5]
51% of business owners plan to award a Christmas bonus

Which Industry Offers the Best Bonuses?

Each industry has its own needs and their bonus offerings reflect this.

The size, market, product and customer base all impact the amount of bonuses.

Find out which industry ranks highest.

  • Among small business owners, 71% offer cash bonuses to their employees. [12]
  • Companies with less than 100 employees provide bonuses to 37% of employees. [1]
  • Larger companies include 44% of their employees in their bonus packages. [1]
  • The Information industry offers end-of-year bonuses to 26% of its employees. [1]
  • However, only 2% of workers in the information industry receive a holiday business. [1]
  • 19% of employees in management, business, and financial occupations receive end-of-year bonuses. [1]
  • Referral bonus is offered to 24% of workers in the information industry. [1]
  • In the management and financial sector, referral bonuses are offered to 10% of employees. [1]
  • Among sales personnel, 13% receive cash profit-sharing bonuses and the same figure for production workers is 11%. [1]
  • ESG-driven bonuses are 10% to 15% higher, on average, than bonuses based on objective financial metrics. [6]

Are Bonuses Expensive for Companies?

Bonus payments are not mandatory but companies still prefer to offer them.

These statistics explain if the costs of these bonuses are worth the benefits gained.

  • 70% of Christmas bonuses are under $500 in value. [12]
  • For most workers, their bonuses equal 1% to 5% of their overall salary. [5]
  • Among small business owners and employees, 70% agree that at least one week’s pay is a good holiday bonus. [12]
  • 62% of those small businesses that don’t give holiday bonuses believe that they are not profitable enough. [12]
  • 23% of companies award bonuses based on their profits for the year. [2]
  • Bloomberg reports that many companies award big annual bonuses to their executives despite their business performance. [6]
  • Cash bonuses for chief financial officers increased by 36% in 2021. [9]
executives receive big bonuses

Do Workers Expect Big Bonuses?

Employees definitely see a morale boost after bonuses.

These monetary benefits are important incentives, but what do employees have to say about them?

These statistics illustrate worker preferences about the amount and frequency of bonus payments.

  • 27% of employees reported that they expect a Christmas bonus in 2023. [12]
  • 84% of workers agree that Christmas bonuses improve employee morale. [12]
  • A Payscale survey states that 65% of US employees prefer bonuses based on personal performance. [10]
  • 53% of workers reported that 12 monthly bonuses are better than one annual bonus, while 47% chose the annual bonus. [10]
  • 51% of employees expect that their bonuses will be larger than last year. [11]
  • Bonuses may not be the best motivation since 58% of employees rank work-life balance above higher pay. [2]
  • Bonuses rank 3rd among drivers of job satisfaction, behind work-life balance and respectful treatment of employees at all levels. [2]

FAQs

What is an average bonus?

An average bonus refers to the typical additional compensation given to employees beyond their regular salary. It’s often based on performance, company profits, or specific metrics.

How is the average bonus calculated?

The average bonus is usually calculated by taking the total bonus pool allocated by a company and dividing it among eligible employees based on predetermined criteria, such as individual performance, tenure, or company performance.

Is there a standard percentage for average bonuses?

There isn’t a universally fixed percentage for bonuses. It varies greatly depending on the industry, company policy, and individual performance. However, bonuses commonly range from a few percentage points to several times an employee’s base salary.

Are bonuses taxed differently than regular income?

Bonuses are generally considered supplemental income and may be subject to different tax withholding rates than regular wages. However, the specific tax treatment can vary by location and individual circumstances.

Can bonuses be negotiated or increased?

In some cases, bonuses may be negotiable, especially for specific roles or during hiring negotiations. However, increasing bonuses usually depends on company policies and financial situations.

In most places, bonuses are discretionary, and there’s typically no legal obligation for employers to provide them unless stated in an employment contract or agreement.

Conclusion

On average, bonuses are attractive to employees and companies rely on them for improving morale.

Average bonuses vary across industries based on their dynamics. 

Small business owners prefer cash bonuses, while the sales industry is famous for referral bonuses.

Most companies base their average bonuses on their profitability and executives usually receive the lion’s share of bonuses.

Overall, bonuses prove to be a good motivator for employees but other factors like work-life balance and recognition are gaining more importance.

Sources

  1. US Bureau of Labor Statistics. Employer-provided bonuses: what are they, what types of businesses offer them, and who receives them?
  2. SHRM. HR Leaders May Need to Look for New Retention Incentives After Bonuses Backfire
  3. SHRM. More Companies Offer Bonuses as a Challenging Year Ends
  4. GoRemotely. 25+ Employee Referral Statistics You Should Know in 2023
  5. Indeed. FAQ: What Is a Fair Bonus Percentage for Employees?
  6. Forbes. 2022: The Year Of The Performance Bonus
  7. Governing. How Public Employee Benefits (Beyond Pensions and Health Care) Compare to the Private Sector’s
  8. Jobcase. An overview of annual bonuses
  9. Wall Street Journal. Bigger Bonuses Lift CFO Pay as Companies Rebound From Pandemic Shock
  10. Small Business Trends. 65% of Employees Prefer Bonuses Based on Personal Performance
  11. SHRM. Employees Have High Hopes for Bonuses This Year
  12. Upflip. Naughty or Nice? Christmas Bonus Statistics Everyone Needs to Know (2023)

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