Employment outplacement firm Challenger, Gray & Christmas has announced there will be a work slowdown next week that will likely cost U.S. employers at least $1.2 billion per work hour.
It’s called March Madness. It affects an estimated 50 million workers. It’s the NCAA Division I Men’s Basketball Tournament, which begins Thursday, March 20.
“There are distractions every day at the office, but the first week of the annual men’s college basketball tournament is particularly hazardous to workplace productivity,” said John A. Challenger, CEO of Challenger, Gray & Christmas.
“While March Madness distractions may not alter the nation’s quarterly GDP numbers, you can be assured that department managers and network administrators notice the effect on work output and company-wide internet speeds,” he explained.
Challenger said the impact on productivity comes from several directions.
“You have employees talking about which teams made or didn’t make the tournament. You have other workers setting up and managing office pools. Of course, there are the office pool participants, some of whom might take five minutes to fill out a bracket, while others spend several hours researching teams, analyzing statistics and completing multiple brackets.”
The actual games begin right in the middle of the workday on Thursday for folks on the East Coast and at 9 a.m. on the West Coast where, Challenger said, workers can spend the entire workday streaming games on their computer or mobile device.
A 2009 Microsoft survey estimated that 50 million Americans will participate in March Madness office pools. If each of those 50 million workers spend just one hour of work time filling in their brackets, the cost to employers in terms of wages paid to unproductive workers would be $1.2 billion, based on average hourly earnings of $24.31 reported in the most recent employment report from the U.S. Bureau of Labor Statistics.
According to other surveys, this estimate could be low. In 2012, 86 percent of respondents to an MSN survey indicated they would devote at least part of their workday to updating brackets, checking scores and following games during the tournament.
If that survey pool was representative of the U.S. working population, more than 100 million workers expected to be distracted by March Madness. The same survey found that 56 percent of workers planned to spend at least one hour of their workday on March Madness activities.
Nonetheless, Challenger says employers should not “clamp down” on the distraction.
“At the end of the day, it is unlikely that a few days of March Madness distraction will impact the company’s bottom line. Taking a hard line on office pools and online streaming, on the other hand, could have a dramatic impact on the bottom line, if it leads to increased turnover or causes employees to become disengaged, which will not only lower both the quantity and quality of work output,” said Challenger.
He said that employers may want to seek ways to use March Madness as a tool to increase employee engagement. Promoting a company-wide office pool that is free to enter, for example, could help boost camaraderie and encourage interaction among co-workers who may not typically cross paths. Relax dress codes and allow workers to wear sweatshirts and T-shirts in support of their favorite team.
“Companies may be able to prevent unplanned absences related to March Madness by serving a catered lunch on the first two days of the tournament. Others may want to have a couple of televisions around the office showing games, which might keep some employees from streaming games at their desk,” he suggested.