March may be over, but the madness is in full swing as the NCAA tournament comes down to the Final Four. With barely a week to go in this annual fascination with college basketball, companies large and small are feeling the financial effects – some good, some not so much. Whether they’re plagued by employees losing productivity or bolstered by a sudden influx of tournament-hungry patrons, the impact is undeniable.
A Blow to Productivity
According to a recent report from outplacement and career transitioning company Challenger, Gray and Christmas, more than 50 million American workers are participating in office pools. While the annual practice may have cost companies approximately $1.2 billion in lost production time in the first week of the basketball tournament alone, the firm has cautioned corporate executives to avoid taking a hard line against bracket pools, friendly discussions at the water cooler and those taking time out for updates. A blow to employee morale and loss of camaraderie could be even more costly to a company’s bottom line in the long run.
A Rise in Morale
While the setback to productivity has declined as the basketball games have transitioned to evening and weekend play, the excitement of bracket busters and newly formed kinships at the office continues. Companies that allow employees to wear their favorite teams’ colors or check office pool updates on the clock can still reap the benefits of enthusiastic workers. A pre-tournament survey by staffing services firm OfficeTeam found that 32 percent of the 300 senior managers surveyed believed that support of March Madness activities had a positive impact on worker morale, compared to just 20 percent in 2013.
A Boon to Business
On the other side of the financial fence, many merchants have seen a rise in business during the NCAA tournament. Hotels, restaurants and shops in host cities have experienced a surge in bookings, as have providers for air and ground transportation. Mid-West bracket host city Indianapolis, for example, expected a $20 million spending impact from this past weekend’s showdowns between the University of Kentucky and University of Louisville, as well as the University of Tennessee and University of Michigan. Kentucky eked out a win against Michigan amid an economic boost for Indianapolis merchants.
Meanwhile, restaurants and sports bars throughout the country offering televised games with food and drink specials are drawing record crowds of their own. In some cases, employees for these businesses are picking up extra shifts and working longer hours to meet the demand.
With the semi-final games set for Friday, April 4 and the championship on Sunday, April 6, 2014, the eyes of millions of Americans are on the Florida Gators, Connecticut Huskies, Wisconsin Badgers and the Kentucky Wildcats. While there’s no doubt that the economic impact of the NCAA tournament has created both winners and losers, only three games remain until it’s back to business as usual.