Employers dread March Madness. Challenger, Gray & Christmas
CEO John Challenger’s famous annual survey predicts this year’s
tournament will have cost $1.7 billion, all told, in lost
productivity.
The survey has come under fire from some quarters. But, for the
moment, let’s leave Challenger’s $1.7 billion figure unchallenged.
That’s a lot of money — a little more than 2 percent of basketball
fans’ total productivity during the tournament. It’s certainly
enough to hurt a bottom line.
Of course, not everyone follows the tournament. Television
ratings are down 9 percent from last year’s Madness. Eight out of
nine televisions in use during game time will be tuned elsewhere.
Thirty-seven million people will enter an office bracket pool this
year, out of a total U.S. workforce of about 153 million.
That means a little less than one half of 1 percent of total
productivity during the tournament will be lost to workers filling
out brackets and watching games on company time. This year’s
tournament lasts 16 work days. Over the course of an entire year,
that $1.7 billion comes to a little more than one hundredth of 1
percent of GDP.
Not exactly earth-shattering, is it? If economic growth goes
negative this quarter, anybody who blames March Madness should be
sent to the showers early.
JOHN CHALLENGER protests, “Those who insist there will be
no impact are kidding themselves.” He’s right. But those
who assume that his estimate of that impact is accurate are also
likely kidding themselves.
The survey makes a leap in logic to get to $1.7 billion that
perhaps it shouldn’t — that if people weren’t following the
tournament, they would otherwise be working. Truth is, workers will
waste some of their time whether it’s March Madness season or
not.
Employers know this. They are not stupid. Down time is already
factored into wages. People are paid according to how much they are
expected to produce. And it is expected that they will not spend
their entire 40 hours on the job actually working.
Nobody knows whether filling out brackets or talking trash to
coworkers is additional slacking, or whether it simply
substitutes for other forms of slackery. Workers regularly
waste time forwarding bad Internet humor to friends and family.
They make personal calls on office time. They go to the water
cooler to catch up on the latest gossip.
Challenger may even be right about the $1.7 billion in time
dedicated to March Madness, but we don’t know if it’s a
net productivity loss or not.
My hunch is that there is a net loss, but it is a lot smaller
than $1.7 billion. People probably do reduce their other
derelictions of duty, but not enough to compensate for all the time
they spend following games.
IT’S ALSO POSSIBLE for the tournament to have some positive effects
in the workplace. March Madness can be great for morale, and good
morale often translates into to productivity gains.
For instance, Duke — the hated Yankees of college basketball —
lost to West Virginia on March 22. Their elimination brought joy to
perhaps as many as 90 percent of college basketball fans.
There are other morale-boosting benefits besides Duke’s
early-round elimination. Almost every office has a bracket pool,
official or otherwise. The best ones give the last-place finisher
his money back, just to rub it in. Besides being good clean, mostly
illegal fun, these bracket contests help employees get to know each
other a little better, even if only to trade friendly insults. A
happy office tends to be a more productive office.
True, brackets come at a cost, and not just the $5 entry fee.
They take time to fill out. That time could be spent working — or
forwarding Hello Kitty e-mails. No one knows the exact balance. But
the worst possible impact is .01 percent of GDP and more likely
it’s far, far less. The people might as well have their fun.
