Bonus pay can be a valuable way for employers to attract and retain workers. And because bonuses often are tied to performance, they create a financial incentive for employees to meet goals and boost productivity.
We analyzed six years of ADP payroll data to see whether bonus payouts are increasing in size and whether more workers are receiving them. Our anonymized sample contained data on some 12 million workers at employers with 50 or more people on the payroll from December 2019 through December 2024.1Looking at December each year, we calculated annual pay and bonuses using a method similar to that used by Pay Insights. For each job, we observed total pay over the preceding 12 months and noted any transactions marked by the word “bonus”. For each job, we observed total pay over the preceding 12 months to compute annual pay. If a job was paid only part of the year, we estimated an annual equivalent using the observed pay rate. Annual bonus pay was then computed by separating payroll transactions from annual pay based on descriptors which strictly indicate a bonus payout. Metrics such as wage growth and bonus growth are based on a sample of job-stayers and measure year-over-year growth in annual salary or annual bonuses. Tips, stock options, and commissions were not counted as bonus pay.
The data showed us that bonuses are becoming less common. Less than half of U.S. workers receive a bonus each year, and the share of workers receiving these pay perks has been falling since 2021. In 2024, fewer than 40 percent of workers received a bonus.
The median bonus payout for all U.S. workers has been shrinking, too, falling to $1,786 in 2024 from $1,857 a year earlier.
In 2024, payouts ranged from no bonus at all to a high of $50 million. Bonus amounts in the 75th and 25th percentiles were $6,500 and $600, respectively.
Among job-stayers—people who have been at the same employer for the past 12 months or more—the median growth rate for 2024 bonuses was 1.3 percent from the prior year.
Employers grant bonuses throughout the year, but workers are more likely to receive them in certain months. In any given year, 13 percent of recipients receive their bonuses in December, 9 percent get them in January, and another 9 percent in November.
Who’s getting bonuses?
Bonus use peaked in 2021, when nearly 44 percent of workers were awarded one.
The temporary labor shortages of the Covid-19 pandemic likely contributed to this bump in bonus awards, as employers increased wages and pay extras to attract and retain workers.
The share of people receiving a bonus increased in 2020 and 2021 across all industries except for mining. Health care experienced the largest increase—14 percentage points—from 2019 to 2021.
At the time, employers were offering bonuses to attract frontline health workers during the pandemic’s public health crisis. Since 2021, the percentage of employees receiving a bonus has gotten smaller but remains greater than it was before the pandemic. s
Year-over-year bonus growth shot up in 2021 across most industries. Leisure and health workers had the highest median growth in bonuses, at 21 percent and 20 percent, respectively. It should also be noted that these growth rates are from a lower base as these two industries rank at the very bottom in bonuses among the industries.
In 2024, 51 percent of construction and manufacturing employees received a bonus, the largest share of any sector. Education professionals fared the worst, with only 18.6 percent of employees receiving a bonus.
How significant are bonuses?
Bonuses make up about 3.5 percent of total gross pay for U.S. workers. In information, finance, and mining, that share rises to 5 percent or more.
Income level matters, too. Among the highest-income earners, bonuses make up a significant share of total pay. For employees making between $150,000 to $250,000 a year, bonuses account for 10 percent of total pay. For people making more than $250,000 a year, they make up 25 percent of total pay.
