THE BIZ: MADNESS PRODUCTIVITY MADNESS

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Stop celebrating, March Madness fans, and get back to work!

March Madness is almost here and we all know what that means: thrilling games, staggering upsets — and massive damage to the American economy. According to Challenger, Gray & Christmas, a Chicago consulting firm, this year's college basketball championships will cost employers as much as $1.7 billion in lost productivity.

     That estimate is about as sound as Syracuse's case for making the NCAA tournament.

     Every year, Challenger conjures up headline-grabbing projections by taking a bunch of numbers from different sources and multiplying them: the number of college hoops fans in America times the number of days in the tournament times the number of hours per day that fans watch games times the average hourly wage. One big problem with that approach is it doesn't differentiate between casual and intense fans. Another is that games take up entire working days only at the very beginning of the tournament; then it's on to nights and weekends.

     More important, all "lost productivity" estimates should come attached to a giant rock of salt, because they assume employees would be hard at work if they weren't distracted by March Madness or the Super Bowl or fantasy sports. Economists can prove you're losing productivity to something as long as you're working less than 168 hours a week. The real-world truth is that every work day contains some slack time and if you don't slack off to college basketball this month, you'll probably just slack off to something else.

     Even during the 2002 World Cup, when English pubs started opening at 7:30 in the morning so fans could catch soccer matches, companies surveyed by the London Chamber of Commerce reported significant increases in staff taking vacation, but low absenteeism. Fans seem to substitute watching sports for other enjoyments and distractions, rather than using sports as an excuse to waste extra hours.

     Which means we should start asking whether the economic impact of March Madness is actually negative at all. Filling out brackets and watching games are social activities that probably bring employees together far better than most corporate "team-building" exercises. Fifty-two percent of gambling on NCAA tournament games takes place in office pools, which means a large chunk of the $3.5 billion wagered every year on college basketball ultimately gets spent on lunches and beers with colleagues.

     There's been some media buzz about how online access to the tournament could jam corporate Internet connections, but no evidence that more than a few small companies are actually worried about it. And while the latest survey data from the Fantasy Sports Trade Association shows employers are increasingly blocking online access to events such as the NCAA tournament, it also shows that employers are increasingly participating in office pools, too. Lesson: Don't feel guilty, and do invite the boss to play.

     Of course, there is one group of workers that undoubtedly becomes much more productive this time of year: the people who come up with claims about how everyone else becomes less productive. Our friends at Challenger, Gray & Christmas declared that March Madness cost employers $765.7 million in 2004, $889.6 million in 2005, $3.8 billion in 2006 and $1.2 billion last year. But such wildly swinging estimates are about as reliable as Robert Morris in a conference tournament. Of course, if the numbers throw a big enough scare into the suits that run your company, Challenger is always available for hire as a productivity consultant.

Think you know men's basketball? Well, predict the winner of each matchup in this year's tournament and you could win $10,000 cash! It's free, so create your entry today!

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