Corporate America's next assignment: Save happy hour

As the traditional happy hour fades, companies are investing in team-bonding events. Getty Images; Alyssa Powell/BI

The traditional happy hour is on the decline due to high prices and changing social habits.

Companies are taking an active role in planning team-bonding events like barbecues and workouts.

For some employees, company events don't live up to spontaneous, informal gatherings with coworkers.

Sagar Risal has found plenty to like about company-sponsored social events.

They've helped him open up to coworkers, meet people outside his immediate team, and celebrate shared successes, said Risal, a 25-year-old who works in financial technology in New York City.

But they still feel different from spontaneously grabbing drinks with a few colleagues after work.

"At a non-company-sponsored event, it's usually with coworkers that you choose to hang out with," Risal told Business Insider. "With work events, it's the entire company that's there."

While Risal's employer mostly throws holiday parties , other companies are going further to bring their workers together, organizing experiences ranging from barbecues and line dancing to custom hat making and high-intensity workouts.

These increasingly elaborate events are part of Corporate America's attempt to revive a fading after-work ritual: the happy hour. The time-honored tradition was once seen as affordable, casual, and spontaneous, but now rising prices, hybrid work , and changing social habits have made these informal gatherings harder to sustain.

Now, for better or worse, some employers are trying to create a replacement.

The traditional happy hour is fading

Happy hour's biggest selling point used to be the prices.

When happy hour rose to prominence in the mid-20th century, cheap food and drink deals were always integral to its cultural status. One 1951 newspaper ad for a café in Los Angeles advertised 25-cent cocktails — $3.22 in today's money — from 5 p.m. to 6 p.m.

The discounts that defined happy hour may no longer feel like much of a deal. Datassential found that among roughly 800 beer drinkers surveyed in 2026, happy hour attendance decreased by 9% from the previous year, while nearly two-thirds said they paid full price for drinks — an increase of 7%.

This comes amid a broader rise in alcohol prices. The average price of an alcoholic drink purchased in a bar, restaurant, or club in the US has increased by more than 25% since just before the COVID-19 pandemic and by more than 75% since 20 years ago, according to the Bureau of Labor Statistics .

As alcohol prices increase, happy hour's modest deals may not be as desirable. Jeff Hutchens/Getty Images

As bar prices rise alongside other cost-of-living increases, modest discounts like $1 off a beer may no longer make an after-work drink feel particularly affordable. Morgan Kulessa, co-owner of Wing Bar in Jersey City, New Jersey, said that in a world of cocktail prices that "would send anyone into a coma," cheap drinks aren't even the central draw anymore.

"It's rare that people are truly looking for a happy hour," Kulessa told Business Insider, noting that, in her experience, many people instead prioritize proximity and atmosphere when looking for bars.

The pandemic also changed how people approach their time outside the home, making an impromptu drink after work feel like a bigger commitment. Heidi Precob, a senior event sales manager at BoomPop, a nationwide corporate event planning firm based in San Francisco, said that in the age of remote and hybrid work, leaving the house for a happy hour is a "bigger ask."

"That time and energy investment is really important to people now," she said.

In Kulessa's experience, even when employees are required to return to the office, it still doesn't always translate to people filling up the bar straight after work. She estimates that about 80% of her regulars have returned to the office nearly every day, and those who get off work at 5 p.m. often appear at around 7:30 p.m. or later, rather than heading straight there.

"Even if you leave the office at 5, how realistic is it for you to be at the bar at 5:01?" Kulessa said. "People want to go home, drop their bag off, maybe even shower. I consider them my second seating."

Hybrid work is also having an effect on happy hour turnout. Michael Paulsen/Houston Chronicle via Getty Images

Companies are trying to rebuild happy hour

As some workers have moved away from spontaneous happy hours, employers have stepped in to design new types of events that could serve as their replacement. Precob said companies are looking to create experiences beyond "run-of-the-mill events" and are taking an active role in planning in an effort to try and get employees to connect.

While typical happy hours are still popular among BoomPop's clients, Precob said, hybrid events — the pairing of alcohol and an activity — are on the rise. Activities like custom hat making, line dancing, and company barbecues amount to what she calls "the evolution rather than the decline" of the company happy hour.

Other companies are cutting alcohol entirely and looking to other areas, such as fitness, to meet their team-bonding needs. Barry's, a fitness chain that specializes in high-intensity workouts, previously told Business Insider it saw a 55% increase in corporate bookings from 2024 to 2025.

"Just kind of throwing them in a room together and hoping some magic happens isn't really the answer anymore," Precob said. Companies are looking for an experience, "designed layer by layer," because it makes employees more likely to attend future events.

Precob also said most of BoomPop's clients — including tech giants, software developers, and commerce platforms — plan events at least three months in advance, or often up to a year beforehand. Employees typically get weeks or months to mark the occasion in their calendars.

The limits of company-sponsored fun

But having companies take on the role of social organize...

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