No, March Madness Does Not Cost Companies Billions In Lost Productivity

It’s NCAA Tournament time, which means it’s also time for that annual round of news stories about the billions of dollars in “lost productivity” likely to be suffered by American companies as a result of workers having their eyes and attention on the men’s college basketball tournament instead of their work responsibilities.

This year, as every year, this discussion is being driven by a firm called Challenger, Gray, and Christmas LLC. The 2019 version of the Challenger report, per a press release, states that “March Madness will cost employees $13.3 billion in lost productivity.”

Challenger, Gray, and Christmas — which is an outplacement firm with no special expertise in statistics or polling — calculates these figures by estimating that “48 percent of all workers, or 75 million people, [spends] over 6 hours of work time on March Madness activities,” over the course of the three-week tournament.

“Streaming games during work hours, heading to a local restaurant to watch the games, filling out brackets, or just discussing the games with co-workers will mean hours of distractions during the three-week tournament,” Andrew Challenger, the firm’s vice president of global outplacement and executive coaching, said in the release.

These numbers, though, are extremely questionable, and not only because there’s no way nearly half of the workers in the United State are spending six hours of work time on their bracket or watching games.

Journalist Jack Shafer, writing in Slate back in 2006 in reaction to a previous Challenger, Gray, and Christmas survey — which put the figure at a much lower $3.8 billion — debunked the entire reasoning behind the reports.

First of all, Shafer noted, only two days of the tournament, the first two days, are held during the day on weekdays. The rest of March Madness, from the second round through the Final Four, takes place either at night or on a weekend, so if employees are watching live streams or sneaking off to the bar during the day, they’re not doing it for the entire three weeks.

Also, the 75 million figure doesn’t line up with established numbers of how many people actually watch the tournament games. As Shafer says, the estimates further assume that workers aren’t wasting time on other things when they’re not watching March Madness.

It's March Madness time, which studies link to billions of dollars lost for businesses nationwide due to less productivity in the workplace. @KSNBLocal4 https://t.co/Of5kxnp9hJ

— Kelsey Dickeson (@KelseyDickeson) March 22, 2019

Shafer also assailed Challenger as “attention-seeking professionals who are in the business of increasing productivity.” It’s also unclear why the average person should feel bad or guilty about companies suffering lost productivity.

Despite the numbers being essentially groundless, the March Madness “lost productivity” still issue gets written about widely in the press every single year. Fox Business, for instance, wrote up the survey uncritically.

WGN Radio, in a report this week, somehow upped the lost productivity figure all the way up to $604 billion. It’s unclear, however, where the supposed amount had originated.