February 27, 2012
Metra commuters can get an extra day of rides on their February pass this year. Apartment dwellers receive an added day for their month’s rent. And auto sellers have an extra day to build up their monthly total.
The 29th day added to February — leap day — brings a smidgen of a financial boost for some consumers and slight adjustments for businesses that rely on daily sales and workers who are paid by the hour.
But for businesses in a global economy, the effects of the extra day are fairly insignificant, especially as hourly-based manufacturing jobs have decreased and more people are paid an annual salary, experts said.
“For most businesses (leap day) was never a big deal and absolutely over time has diminished,” said Ken Goldstein, an economist with The Conference Board, a nonprofit business research association.
Leap year has been around since the days of Julius Caesar. It is needed because the Earth’s orbit takes a little longer than 365 days to travel around the sun. Feb. 29 is added to the calendar every four years, except for century years not evenly divisible by 400.
Various traditions have sprung up for leap day over the years — it was once known as a day when women could propose marriage to men.
Larry Lubell, president at Urban Insurance Agency in Chicago, said February is usually a tough month for his business, and he’s glad to have an extra 24 hours to generate revenue. Wednesday “will diminish the negative effect the month usually has,” he said.
Lubell said his company usually takes in about $15,000 less in February than other months. Leap day is likely to cut that shortfall in half, he said.
For auto dealerships and hotels, Feb. 29 represents an additional opportunity to sell cars and book rooms. But because it falls on a Wednesday, this year’s leap day will be less of a bonus than it could be, they said.
It would be better if Feb. 29 fell on a Saturday, when the car dealerships tend to see the most business, said Gene Storm, general manager of Fletcher Jones Honda in Chicago.
“The way the car business works is I can sell zero cars one day but then seven on the next,” Storm said. “But in general, Wednesday is not going to be dramatic.”
An extra Wednesday in the month also will be less of a boon for hotels, where weekends are when business booms.
“It’s just an extra day,” said Jewel Ritchie, manager of the Hotel Felix in downtown Chicago.
Some businesses plan to make small changes.
Richard Dux, owner of a downtown Subway restaurant, said his February expenses have to be adjusted for the extra day because most of his workers are on hourly wages.
He said the additional day accounts for about 90 more working hours and will cost him an additional $70 in utilities.
But Dux, like other business owners, say that’s not a big deal.
“It’s a short-term phenomenon,” said Sebastien Gay, economics professor at theUniversity of Chicago. “If there are losses, (businesses) will recover in the next month.”
For many businesses, changes in the weather each year will have a much bigger effect than an extra day in February.
Joan Schermerhorn, property manager at Evanston-based Schermerhorn & Co., whose company manages about 90 rental properties, said the savings this year on heat and snow removal are much larger than anything to do with leap year.
“We look more at the big picture,” she said.