Key Findings

• The average end-of-year bonuses increased about 2% compared to 2023 bonuses. December bonuses in 2023 came out to an average of $2,447 compared to $2,503 in December 2024. 
• The share of workers receiving a bonus declined in 2024 by almost 2% compared to 2023. While some employers are continuing to use bonuses as a tool to keep their top performers engaged, many do not appear to be paying out bonuses to the entire staff.
• The average end-of-year bonus increased significantly among several white-collar industries, including Communications (up 22%), Technology (up 7%), and Professional Services (up 6%). 
• Many service industry workers saw smaller end-of-year bonuses in 2024 than in 2023. Sectors like transportation and warehousing faced reduced demand, leading to significant declines in year-end bonuses for workers in these industries.

Introduction

End-of-year bonuses are both an important tool that employers use as incentives to acknowledge performance throughout the year and motivate retention and performance in the year to come. They are also an important piece of employee compensation. Gusto’s data show that many workers received larger bonuses in December 2024 compared to December 2023, but this increase was concentrated in certain industries.

The average year-end bonus in 2024 was $2,503, up about 2% compared to 2023. However, the share of workers receiving a bonus declined by almost 2% over the same period. So, while there are fewer workers who received a bonus this year than in 2023, the average payment was a bit higher for those who received one.

This indicates that while some employers are continuing to use bonuses as a tool to keep their top performers engaged, they may not be paying bonuses to the entire staff, as we sometimes saw during the peak of the hiring market in 2021 and 2022. 

Bonuses were up across most industries, but some industries saw declines.

After a year of modest hiring and wage growth across the economy, bonuses in 2024 have risen across most industries compared to 2023. This reflects a general optimism among small business owners and managers as we head into 2025.   

There were notable increases in several white-collar industries, including Communications (up 22%), Technology (up 7%), and Professional Services (up 6%). This is particularly notable since these industries had some of the lowest wage growth in 2024 but are forecasted to have the highest wage growth in 2025. Increases in end-of-year bonuses are additional evidence we may see more investments in these industries in the form of wage growth as we head into the new year. 

Conversely, declines in bonuses in service industries such as Personal Services (down 10%), and Tourism & Accommodations (down 7%) signal that after years of significant wage growth in response to pandemic-era shutdowns and subsequent reopenings, we may be starting to see a cooling in the wage growth for service workers as we enter 2025. 

The share of workers receiving a bonus is slightly down but varies notably by industry. 

About half of the 19 industries we track saw decreases in the share of workers that received a bonus from 2023 to 2024. 

Meanwhile, the other half had either stable or increased shares of workers who received bonuses. The largest drop was in Healthcare & Social Assistance, with 8% fewer workers receiving a bonus relative to 2023. 

Methodology

This report's data comes from anonymized payroll data from more than 400,000 businesses across the country. The average bonus is measured as the average bonus paid to employees who received bonus payments greater than zero in December 2024. The share of employees who received a bonus measures the share of active employees in December 2024 who received a bonus payment greater than zero.