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Workus InterruptusSure, take a break—and help cost the U.S. economy $588 billion.

By Jeff MerronPosted Thursday, March 16, 2006, at 12:06 PM ET

While writing the second draft of this article, my telephone rang. I didn't answer it, but I took a few seconds to check caller ID and think about it. Then it took me a few minutes to get back on track. This interaction—three minutes out of my workday—supposedly cost the U.S. economy about a buck.

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"Workplace interruptions" like that phone call slice $588 billion a year from the national economy, according to a widely quoted figure that comes from the New York consulting firm Basex. If American workers could work without interruption, the country would apparently be able to pay off this year's record $400 billion federal budget deficit and still have enough cash left over to mail every U.S. citizen a check for $635.71.

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In 2005, Daniel Gross found that fat people and the niche markets they create could save the U.S. economy: "Our competitive disadvantage in the gym could ultimately be a competitive advantage in the international marketplace." Also in 2005, Daniel Gross discussed how Katrina could damage the American economy more than 9/11. This month, Austan Goolsbee described how incentive pay could make bus drivers more efficient.

Except, of course, that Basex's estimate—like just about every other estimate you see that's followed by the phrase "costs the U.S. economy"—is largely bogus.

Time magazine explained how these costs are calculated when it published the $588 billion figure in January. Using Bureau of Labor statistics data from 2005, Basex estimated that "knowledge workers" earn an average of $21 an hour. Then, based on online surveys and about 200 follow-up phone interviews, Basex concluded that these knowledge workers spend an average 2.1 hours each day fielding interruptions from e-mail messages, phone calls, instant messages, chatty co-workers, and so on. Included is the time workers spend "recovering"—getting back to what they were doing in the first place.

The Bureau of Labor Statistics counts 56 million knowledge workers in the United States, says Jonathan Spira, CEO and chief analyst for Basex. Rounding down a bit, Basex estimated that each worker is "losing" to interruptions 10 hours a week, or 500 hours a year. The cost per year for the average knowledge worker: $10,500. Multiply by 56 million, and you get to $588 billion.

So, if we eliminated workplace interruptions, I asked Spira, would the companies we work for boost profits? Would we all get big raises? Not so much, Spira admitted. "The U.S. economy wouldn't grow by $588 billion if we got rid of these interruptions," he said. "We put it this way to illustrate that managers don't really know how to manage."

It's true that fewer interruptions might give employees more time to debug software, seek new business from important clients, or write more articles. But that time hole is no gold-spinning Sutter's Mill.

The point is that the oft-used phrase "costs the U.S. economy" is disturbingly vague and rarely accurate. Spira told me that his figure often gets cited without question. What other workplace-related issues are supposedly draining our national bank account? Here's a list based on a quick Nexis search.

Cost to the U.S. economy of annoying co-worker behavior: $300 billion.

Cost of negativity: $300 billion.

Cost of disengaged employees: $256 to $363 billion.

Cost of spam: $22 billion.

Cost of product counterfeiting and copyright piracy: $600 billion.

Cost of movie pirating: $3 billion.

Cost of delays at U.S.-Canada border: $4.1 billion.

Cost of power disruptions: $100 billion.

These figures aren't destined for any reputable economics textbook. To begin with, it's hard to believe that workplace interruptions really do nearly eight times the damage of rising oil prices, which are said to cost the economy $75 billion. Then consider the double-dipping. No doubt some work "negativity" involves all those annoying co-workers. And when the power goes out, disengaged employees don't even notice. Consider in addition that each of these costs has a corresponding economic payoff. Anti-spam efforts keep well-paid software engineers employed. Annoying co-workers have spawned a healthy market in noise-canceling headphones. There's no standard method for smoothing out all the overlap and contradiction.

Often, though not invariably, "costs to the U.S. economy" are self-serving sums concocted by lobbyists, companies, and advocacy and trade groups in order to grab attention. Basex, for example, is a consulting company that—you guessed it—would love to help you cut down on all those pesky interruptions, for a fee.

That's not to say there's nothing at all to the hype, though. If I'd closed my office door and muted my phone, I'd have finished writing this 25 minutes ago. Which would have given me time to send a copy of the Natalie Portman rap to my buddy Andrew. Ah, I can annoy him with that tomorrow.

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Jeff Merron is a staff writer and columnist at ESPN.com.

COMMENTS

I agree with your overall conclusion, but you make a mistake by reducing the cost to the economy caused by certain unproductive tasks by the benefit to the economy from the creation of jobs just to combat the unproductive task.

For example, costs of spam to the economy is not reduced by the creation of an anti-spam industry. If it were not for the spam, the money spent on antispam could be spent elsewhere, such as higher salaries. Likewise, the workers providing antispam service could do work making things that actually did create wealth. Its like saying theives and burglars make the economy stronger because the price of what they steal is far less than the industries of alarm systems, police, judges, and prisons to combat and control them. The total costs of the theft to society, like the cost of spam, is the direct cost of evil plus (not minus) the costs of all efforts to reduce the evil.

For a better explanation of this common "broken window" falacy, check out what Fredrick Bastiat wrote about 150 years ago:
http://en.wikipedia.org/wiki/Broken_window_fallacy

--seldeen

(To reply, click here.)

I work in market research and am constantly cursing the mere parroting of numbers without context.

Of course sports is the worst offender, but numbers quoted with any type of government connection can actually be a lot more dangerous since people may actually act based on those numbers.

For example - imagine the holy hell work would be for the typical "knowledge" worker if managers were all on the lookout for wasted time at work (such as this response) - hell because the $588 billion lost is probably based on an 8 hr workday. Would love to see that again! Nowadays we "knowledge" workers are often times expected to stay connected to work 24/7 via Blackberry's; internet; cell phones; long daily hours

so these types of numbers are next to useless - if I spend 2.1 hrs a day replying to Slate articles that doesn't mean I am working less than an 8 hour day. It just means I spent 2.1 hrs replying to Slate articles.

Ah Mr Twain and his lies, damned lies and statistics...

--BRONXBOB

(To reply, click here.)

Those are not workplace interruptions, mister, they are affirmative distractions. Like Slate, or the Fray, for example. By affirmative, I mean they can actually be conducive to productivity. I work in finance. Political and business news here often relates, at least in broad outline, to what I do. So I use the analysis, follow the links, read the stories, become interesting at cocktail parties with the right people and voila! I have done more good for my employer than an entire day of procedure-writing.

--rundeep

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