It takes the Earth 365 days and six hours to make one full rotation around the sun. In order to account for those six extra hours, we introduce a leap day every four years—tacking on a 29th day to the end of February. We keep our calendar aligned with Earth’s revolutions and everyone gets an extra 24 hours—seems like a win-win, right?
Well, not for everyone. Salaried employees are typically paid for 261 days of work, but in a leap year they work 262. This results in a very small difference in salaried workers’ pay. If an employee makes $50,000 a year, they make roughly $191.57 a day in wages. But in a leap year they make $190.84. That’s a difference of $0.73 each day.
Plus, in order to get to work today, employees have to spend extra on commuting and another day’s lunch.
And you don’t just lose out at the office. You can also expect to take a hit on bank interest today. When calculating interest rates, banks typically don’t account for February’s extra day. That means they’ll keep the profits from your money. But don’t get too concerned—when you’re making about 1% annually, it doesn’t add up to much.
Though these losses won’t break your wallet, some people are calling for leap day to be a national holiday. The online retailer Zappos is giving its 1,600 employees a paid day off today and launching a social media campaign called #TakeTheLeap to make the day a holiday for everyone.
There are some financial benefits to leap days—Monthly subscription services like cable and Netflix become a bit cheaper. So does insurance and your mortgage. And renters get an extra day for free.
And Leap Year is good for the U.S. GDP, which gets a boost from an extra day of productivity: 1/365th of the GDP is about $50 billion. That’s more than the annual GDP of Costa Rica.
As for markets, the results are mixed. Over the last 40 years, the S&P was up for five leap days and down for five. What will today bring?