Tuesday, April 4, 2017

The Dark Side of March Madness

Written by: Josh Swanson

The Dark Side of March Madness

March Madness is single handedly one of the most popular eventful basketball event that occurs throughout the entire year. With it comes once in a lifetime opportunities for players, schools, and fans. However, there is another side to March Madness that is over sought. Every year, millions of people fill out brackets and just about the same amount stream or attend the games while at work or school. Lots even take off of work or school. Focusing on work, many people don’t realize the negative effect March madness has on many businesses. When March Madness Arrives, productivity of many workers significantly drops. Now yes, march madness brings in millions and millions of dollars in revenue to the economy, but many businesses whose profits and customer base is not directly correlated with March Madness are hurt by it every year due to the productivity decrease seen by the employees.

According to Fox Business, over 23.7 million workers will use company time to research, perfect, and build their March Madness brackets for 2017. Sadly, not only is that true, but U.S. employers may suffer over $615 million in hourly wages meaning that they will be paying over $615 million for workers to do nothing but bracket related stuff. Additionally, it is estimated on the higher end that if say 81.5 million workers spent an hour or more on their brackets, businesses would lose over 2.1 billion. To put this in the correct perspective, the term “losing money” could mean either the business is physically losing money due to the negative productivity or they could just be losing the opportunity to profit more money. To be honest, due to the fact that consumer spending is at such a high rate and the private spending rate at a low from people spending so much money on things having to do with March Madness, businesses that indirectly deal with March Madness could take advantage of the imbalanced disposable income of consumers.

With the overall increase in technology and technological platforms in the recent years, the overall demand for march madness has increased due to the rise in technological advances. Workers now have numerous ways they can stream the games without leaving their desks.Due to this, over $6.3 billion is lost just in productivity showing the major decrease in the labour force.

Many cities received serious positive benefits economically from the tournament. For example, March Madness affected Milwaukee with a $6.6 billion impact as they hosted a couple of very good games. This is great for Milwaukee as a city, but it is interesting to think about how many Milwaukee based business lost out on sales or profits because of worker productivity. In fact, there were probably many workers who took the day off to either go to the game since it was so local, or went to work and “took the day off.” Due to the fact that in order to stream games, it is basically free for any person who wants to, the opportunity cost for workers when handling their own personal money is not as high because they don’t have to use it to still see the games.

The amount of money that is lost through the negative productivity is something that seriously affects businesses as many businesses are in firms that strive to get most of their business within the months of March and April. Either way, March Madness has its positive aspects and and its negative ones too. Yes, March Madness does help local economies such as Milwaukee which increase the city's revenue as well as increasing the gross domestic product, but it also decreases businesses productivity and profits during these couple weeks due to the major drop in employee productivity.


Works Cited



Barrabi, Thomas. “March Madness 2017: U.S. Companies Will Lose Billions to Slacking Workers.” Fox Business, Fox News, 1 Mar. 2017, http://www.foxbusiness.com/features/2017/03/01/march-madness-2017-u-s-companies-will-lose-billions-to-slacking-workers.html

Shafer, Dan. “March Madness Economic Impact in Milwaukee Exceeds Expectations.” Industry News, Milwaukee Journal Sentinel, 21 Mar. 2017, http://www.bizjournals.com/milwaukee/news/2017/03/21/march-madness-economic-impact-in-milwaukee-exceeds.html

19 comments:

  1. It is really interesting to see how much, economically, that March Madness affects. Although many people build their brackets or watch the games during work, it is kind of excessive to blame the productivity on only that. However, it is good for many other businesses like the ones you mentioned in Milwaukee, as they gain a larger revenue due to March Madness fans. Most of these businesses are probably restaurants as people like to watch games there. Overall, I agree that March Madness can help and hurt some businesses and their productivity.

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  2. It is crazy to see march madness, but I do not think people take into consideration all the different impacts that it has. Although there is a decrease in productivity at the work place, I still see the positives outweighing the negatives. I myself had the opportunity to attend march madness this year and it was and it was quite the money maker. Every restaurant, parking garage and hotel was full meaning money is definitely being made. Overall I see the positives outweighing the negatives in this great college event.

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  3. I can safely say that I was one of those workers whose productivity significantly declined during the hours of March Madness. I am certain that my output as an employee was not as much as it would have been had March Madness not existed. One thing you didn't talk about, however, was the time spent by teachers in classrooms showing off March Madness games. The educational time lost on March Madness could be significant too. Not at Pewaukee, of course, but at some other schools teachers like to watch March Madness during the day as well and seeing as they have command of the classroom, they can show the tournament to all of their students, effectively wasting class time and taxpayer dollars. But I wouldn't complain, March Madness is great.

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  4. If the business is having a company bracket it may be perfectly acceptable to take time out of ones work day. Companies may have a bracket competition as an ongoing team building event to allow employees to discuss basketball with each other as a change in events so they can maintain more personal relationships and in turn, become better teams. If the bracket is not work related however, this is a serious issue which employers must combat. If an employee wont stop watching the games, the company will be essentially throwing away resources to pay an employee who for 1/12 of the year, does not work. Not only is it economically wrong for employees to watch basketball while on the clock, it is also ethically wrong. As for students, watching basketball has no place during instructional time. Taxpayers invest thousands of dollers to ensure every kid has the same opportunity to attend school and create a life for themselves, but if the students want to waste societies investment in them to watch basketball, the students are clearly not deserving of the opportunity to receive years of free education.

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  5. Although hosting the final four brought a great deal of business to Milwaukee, more money was probably lost due to research for brackets. There's nothing wrong with taking some time out of the day to fill out a bracket, especially for company pool. In a way, a short break to fill out a bracket can increase work in the long run. I do believe that it is okay that some worker activity is lost to create brackets, as it only happens once every year.

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  6. Before reading this article, I knew that lots of people in school or work streamed the games instead of working, but I did not realize the cost was that high. It would be interesting to look at how much that number has increased over the years as technology has progressed to make the games easier to watch free and on the go. As you stated, now that the games are free, there is a much lower opportunity cost to people because they do not have to pay or leave work to get in on the action.

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  7. March madness also takes away from schooling as many students focus on completeing these brackets that school work may decrease in quality and some students might not even turn in work for their classes decreasing their grades.

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  8. In addition to people being distracted while at work, streaming the games slows down the internet for everyone else at the school. This in turn, prevents others from being able to get work done.

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  9. It is really crazy how much businesses lose money to a simple basketball tournament that goes on every year. I think businesses should find a way to make their workers work and participate in the games, almost like a bracket for the company and at the end of the day the workers can check the games together in the break room instead of wasting their work time watching the games.

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  10. People don't think of the opportunity cost of march madness. After reading this and seeing the negative side of the event, is march madness really worth it?. The cost is so high but it comes with some good things. But march madness is hurting the small businesses that can't come back from that big of a loss from there workers.

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  11. The amount that a business loses do to a tournament like march madness is crazy to think about. It makes sense because in school we see this a lot too, where students are more interested in the games than the school activity. Like kevin said above, it's not only hard on businesses but schools too because the internet is slow because there are a lot of people trying to stream the games. It's a problem that should be fixed in school and business to make sure that people can max their benefits and profits while still enjoying the March madness hype.

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  12. Streaming the March Madness games have surely become the norm, but I never really thought about the negative impacts of it. It would be really interesting to send out a survey to those working in the Milwaukee area asking how much work time they've spent streaming basketball (or any sport for that matter depending on the time of year). I'm sure a huge percentage would say they've dedicated a lot of their time to streaming games, especially since the opportunity cost is so low as you said. Business could probably set limits on the amount of streaming if their output becomes super low or employees just have to realize that by streaming games they'll fall behind on their work.

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  13. It is a shame that economic output is decreased by so much just due to a sporting event. It is crazy that the entire output of a nation can be decreased so much just due to a basketball game. The productivity of a nation can be reduced so much by a small event, it is unbelievable.

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  14. To be completely honest, it is not hard to believe that work productivity and profit decreases for certain businesses during March Madness. In a way, I have seen a tiny glimpse of what the workforce may have looked like during this time just by coming to school. Whether it's students asking to go to the bathroom to watch the end of a game or the constant notifications going off on their phones, March Madness is distracting. However, the tournament makes a good profit. Milwaukee was one of many cities that held a few basketball games. The revenue that is brought in just by one game is incredible. The local restaurants are packed and the city is buzzing! Overall I think the revenue cities bring in and the fun the tournament provides makes the slight distraction for a month worth it.

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  15. It is very interesting that we always hear about all of the positives and almost none of the negative impacts of March Madness. It is not very hard to believe that so much money is lost due to this event. Many people tune into this event regardless of their knowledge of basketball. Based off of just the amount of people I saw watching the event at school, one could only imagine adults across america watching from their work. I think it would be really interesting to see a graph of a companies productive before and during March Madness.

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  16. March Madness is something that I look forward to every year, and is something I will continue to look forward to. You mentioned a lot in your piece about the time people spend creating their brackets that lead to the loss of revenue, but I also think that a large portion of this is watching the games on the first Thursday and Friday to see how their bracket is doing that contributes to this massive loss. It is interesting to hear about the "dark" side of march madness, because often times it is put in such a positive light. I will never stop watching March Madness, but after hearing these facts, I may think twice before I completely engulf myself in basketball and not in my work.

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  17. I never considered the effect that March Madness has on the economy relating to businesses that are not correlated with March Madness activity. For example, I never thought about March Madness basketball, affecting the amount of money that a bank loses out on. However, this makes perfect sense considering even in school, all that people want to do is stream the March Madness games from their laptops. Sometimes the teachers even give in to allowing the game to stream during class if they (a) give in to the peer pressure from students, or (b) wish to watch the game themselves. Overall, the productivity during the school day decreases. Not only at school, but at home students do not put in the work of completing chores because their time is occupied by basketball. Therefore, after I began thinking about these circumstances, it makes sense that they also relate to businesses as workers also slack off because of their love for watching the tournament. If they are given a computer, the temptation is there to search the web for the games. Unfortunately, this costs the businesses as they are paying employees to do virtually no work during this time. To most workers, their consequence of falling behind in work, is nothing worth changing as they believe watching the game is a far better option. It is their choice, but unfortunately it can lead to a massive loss for companies.

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  18. It's interesting to see the negative sides to March Madness because it is such a well known event during college basketball season. Many individuals are distracted by watching the games instead of getting work done. Although, I personally think that there are more positives because local restaurants or places like Bdubs play the game which consumers can eat while watching the game. For those companies, they most likely gain a larger profit during March because of March Madness.

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  19. This is very interesting to see the "dark side of March Madness" because it is generally put in such a positive light. I can definitely see how it would decrease productivity for the workers who are watching the games, but it can also slow down the internet for those who are actually trying to get stuff done. Perhaps the firms who are trying to maximize their profits and productivity in March and April, should set aside times were the employees can watch March madness, and can therefore be more productive and completely focused during the time they are actually working.

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