March Madness Costs Employers 3.75 Million Hours Per Day

With the field of 68 teams now selected for the NCAA Division 1 men’s basketball championship tournament – affectionately known as March Madness – companies around the country are preparing for is likely to be a week with noticeably diminished productivity as workers begin the annual tradition of organizing office pools, filling out brackets and watching streaming broadcasts of the games from their desks.

“Monday could be particularly dreadful on the productivity front, as a new study out today from a Penn State University assistant professor suggests that the loss of sleep stemming from the annual change to daylight savings time results in workers to spend more time than normal surfing the web. The ‘cyberloafing,’ as it has been coined, could be particularly robust today as many workers take to the Net to research teams and study match-ups in an attempt to generate a winging office pool bracket,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

“Certainly, statisticians, economists, academia and college basketball fans will likely scoff at our estimate, and rightfully so. It is to be taken with a grain of salt, as it is meant to be a tongue-in-cheek look at how technology continues to blur the line between our professional and personal lives. Ultimately, March Madness will not even register a blip on the nation’s economic radar and even the smallest company will survive the month without any impact on their bottom line.”

In its annual “study,” that gives legitimate scientific studies a bad name, outplacement firm Challenger, Gray & Christmas, Inc. predicts that while March Madness will not be the downfall of the American economy, it could result in millions of hours in lost productivity, or at least diminished productivity, as workers across the nation take time from their work schedules to watch games online, check scores and manage their office pool brackets.

Based on last year’s data, online March Madness coverage could attract more than 2.5 million unique visitors per day, each spending an average of 90 minutes watching games. With private-sector workers earning an average of $23.29 per hour, Challenger estimates that employers will end up paying distracted workers about $175 million over the first two full days of the tournament.

“Statisticians, economists, academia and college basketball fans will likely scoff at that estimate, and rightfully so. It is to be taken with a grain of salt, as it is meant to be a tongue-in-cheek look at how technology continues to blur the line between our professional and personal lives. Ultimately, March Madness will not even register a blip on the nation’s economic radar and even the smallest company will survive the month without any impact on their bottom line,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

“That is not to say there is absolutely no impact. However, it is felt at the micro level. The company’s internet speeds may be slower, some workers will not respond to emails as promptly, and lunch breaks may extend beyond the usual time limits. It’s mostly a headache-inducing annoyance for information technology departments, human resources and department managers,” said Challenger.

So, why does the company continue to issue its dubious estimates of March Madness productivity loss year after year?

“It’s an opportunity to remind workers that practicing some moderation in their March Madness viewing will go a long way toward keeping managers off their back. Meanwhile, it is equally important for employers to cut workers some slack, particularly in an economy that has left many workplaces understaffed and overworked,” said Challenger.

A survey just released by MSN indicates that employers may simply have to accept the fact that workers will find some way to enjoy the games. In the survey, 86 percent of respondents said they plan to devote at least some time during their work day to follow games, scores and updates, showing a five percent increase from last year (81 percent).

A more detailed breakdown of the MSN survey data revealed that more than half (56 percent) plan to dedicate at least one hour of work during the first two days of the tournament to watching games or following scores, with 11 percent saying they will do the same for at least five hours and six percent saying they take the first two days off!

Luckily for these determined basketball fans, there are more choices than ever when it comes to watching tournament games. Last month, Turner Sports, CBS Sports and the NCAA announced that NCAA® March Madness® Live, formerly March Madness on Demand, will provide college basketball fans with more opportunities to watch games across multiple devices. For the first time, mobile devices sporting the Android operating system will have access to the games, which should help boost viewership from last year’s record-breaking levels.

According to statistics released shortly after last year’s NCAA men’s basketball tournament, March Madness on Demand (as it was still known, at the time) saw a 47 percent increase in total visits during the first three rounds, reaching a whopping 26.7 million visits, during which a total of 10.3 million hours of streaming video was consumed.

Other statistics revealed that there was an average of 2.4 million daily unique visitors on broadband and 702,000 average daily unique users through mobile apps during the second and third round of 2011 tournament. Each of these users spent an average of 92.9 minutes per day streaming live video.

This year, the tournament begins on March 13 and 14, when four play-in games will determine the final entrants to the field of 64 teams that will kick off second-round games on Thursday, March 15 and Friday, March 16. The 32 games played Thursday and Friday could begin as early as noon eastern time, right in the middle of the workday.

“It is not just a matter of watching the games during the workday that threatens productivity. Starting the Monday before the tournament begins, workers are likely to be distracted by filling in their brackets for the ubiquitous March Madness office pools,” noted Challenger.

In the MSN survey, 31 percent of respondents said they planned to enter at least two betting pools. That is down from 58 percent who entered two or more pools last year. That may provide some relief for department managers, but the survey shows that 58 percent still plan to enter at least one pool.

So, what is an employer to do about the potential for increased distraction related to March Madness?

“Rather than try to squash employee interest in March Madness, companies could embrace it as a way to build morale and camaraderie. This could mean putting televisions in the break room, so employees have somewhere to watch the games other than the Internet. Employers might consider organizing a company-wide pool, which should have no entry fee in order to avoid ethical and/or legal questions,” Challenger suggested.

“At the very least, department managers may want to consider simply looking the other way, unless March Madness proves to be an overt and significant problem. Obviously, if an employee fails to meet a deadline or if customer service suffers as a result of March Madness distractions, then there should be consequences. However, if employees are getting all of their work done and customers are happy and the biggest problem is a slow internet connection for a couple of days, it may be best to let it slide,” he said.