March Madness Costs Offices $192 Million


NEW YORK (MainStreet) — Employers may not be looking forward to March Madness.

According to a report from outplacement company Challenger, Gray & Christmas, Inc., an estimated 8.4 million work hours will be lost to the annual three-week long tournament set to begin Tuesday.

Challenger says if you multiply that figure by $22.87, the average hourly earnings among private-sector workers, the financial impact would exceed $192 million.

The estimates are based off of last year's traffic statistics from, whose online streaming service attracted 8.3 million unique visitors. These visitors enjoyed a total of 11.7 million hours of online video and audio, which averages to about 1.4 hours per visitor.

Challenger expects the 2011 figures to increase at least 20% to about 14 million total hours, largely due to the growing popularity of smartphones and tablets. CBSSports, for instance, is featuring a free smartphone app that allows users to watch the games for this first time on their phones this year.

There are also four additional first-round games this year since the NCAA expanded the tournament to 68 teams. However, Challenger says, the impact these games will have is expected to be minimal since they will be played during primetime.

"It could make filling out one’s bracket a little more complicated, depending on how those running the pools decide to incorporate the new format,” CEO John A. Challenger explained in a press release.

Challenger also explained that the hit to productivity isn't as bad as many employers might think.

Referencing Labor Department data, Challenger said there are roughly 108.3 million people on private payrolls, each working an average of 34.2 hours per week. This puts the total number of hours worked by the American workforce in one week at about 3.7 billion.

“Over the three weeks of the tournament, the nation's 108 million workers will have logged more than 11 billion hours of work," Challenger said. "The 8.4 million hours lost to March Madness is a relative drop in the bucket, accounting for less than one-tenth of one percent (about 0.07%) of the total hours American workers will put in over the three weeks of the tournament."

Challenger said that despite the minimal impact, small firms may experience a few hiccups due to the tournament.

“For an office with 50 to 100 workers, five or 10 people streaming basketball games will definitely have an impact on everyone else’s internet speed,” he said.

As such, Challenger suggests that employers embrace the tournament as a way to build company morale and workplace camaraderie.

"This could mean putting televisions in the break room, so employees have somewhere to watch the games other than the Internet," he said. "Employers might consider organizing a company-wide pool, which should have no entry fee in order to avoid ethical and/or legal questions.”

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