Salary Disparity Highlights Challenge for MLS

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On Thursday, the Major League Soccer Players Union released their bi-annual list of all MLS player salaries, and contained within the PDF which can be found here is some pretty jaw-dropping information.  Now, considering the MLS is still a relatively young major sports league, currently in its 21st season, and the difficulty in getting soccer to appeal to the American audience, we shouldn’t expect to see the same kind of salaries as the traditional “Big 4” North American leagues- the NFL, NBA, MLB, and NHL.  However, the large differences in pay, especially the ridiculous differences between the league’s highest paid players to the league average, highlight one of the biggest challenges facing the MLS in the future.

Currently, the average salary in the MLS is $316,777.30.  By everyday standards, this is a lot of money.  However, the sum is far less than the minimum salaries for all four of the major North American leagues, which stand around $500k.  Perhaps the comparison to these leagues is unfair to the MLS.  However, a 2014 study by the Daily Mail of 34 of the world’s biggest soccer leagues, found here, concluded that the MLS ranks just 22nd in average player salary per year, just behind leagues in Denmark and Greece.  However, the league ranks 8th in average attendance and 13th in average club income per year.  Out of the leagues listed, only the Japanese J-League offers players a smaller proportion of its average club income than the MLS.  In this sense, by global standards MLS players are underpaid.

A big reason for this is the MLS’ salary cap (full information available here), which essentially states that first 18-20 players on a team’s 28-man roster, known as the Senior Roster, cannot be paid more than $3,660,000 million in total, with no more than $457,500 going to a single player.  Additionally, the cap sets minimum salaries of $62,500 for players 21-24 and $50,000 for players 25-28.  The main exception to the salary cap comes in the form of the Designated Player Rule, which states that a team can pay up to three players more than the league maximum as long as a certain amount, determined by the player’s birth year, counts toward the salary cap and the club picks up the remaining cost.

The Designated Player Rule has undoubtedly been beneficial to the MLS, allowing the signing of international stars, beginning with players such as David Beckham and Thierry Henry, and more recently Kaká , Steven Gerrard, and Andrea Pirlo, among others.  With these players have come increased media coverage and excitement in the MLS.  However, by allowing a small minority of players in the league to make essentially a limitless salary while heavily constricting pay to the rest of the league, a large salary imbalance is created.

The average salary for an MLS team is currently about $8.7 million, or well over twice the league’s salary cap.  Kaká is the league’s highest paid player, making $7,167,500 this season for Orlando City SC, just edging out Toronto FC’s Sebastian Giovinco, earning 7,115,556 this year.  Both of these players single-handedly make more than 14 of the 20 teams in the MLS.  In fact, nine players- Kaká, Giovinco, Michael Bradley, Gerrard, Frank Lampard, Pirlo, David Villa, Jozy Altidore, and Clint Dempsey all make more than FC Dallas, the league’s cheapest payroll at roughly $4.3 million.  In terms of salaries, the league is so top heavy that the MLS average salary of $316,777.30 is almost three times more than its median salary of $117,000.  The league’s top 10 highest paid players (the nine above and Giovani dos Santos) make 33.25%, or just under one third of the salaries for the entire league.  The 23 players earning $1 million or more make over 45%.  Kaká makes over 62% of the salary for his entire 28-man team.

This kind of disparity between members of the same league is simply ridiculous.  It’s tough to really fault the MLS, though.  When David Beckham joined the MLS in 2007, everyone suddenly wanted to attend LA Galaxy games.  With more stars, the MLS is starting to create these “must-see” games that drive in revenue.  However, a league so top-heavy in salaries and advertising is only really desirable for those few big names.  Only a handful of MLS players are “set for life” upon retirement, and most of them are by no means “rich”.  It doesn’t seem fair to have some players making over 100 times more than other players on their same team.

At the end of the day, everyone in the MLS is a professional athlete, and deserves to be compensated as such.  Often, an aging superstar will still be one of the best players in the league, but by no means do they make their entire team, or are they miles better than players making small fractions of their salaries.  Soccer is not basketball, where having a LeBron James instantly turns a team into a title contender.  In ESPN’s 2016 Anonymous MLS Player Poll, just 8% of responders thought MLS players were being paid fairly, and two-thirds would leave the MLS if they had a chance to play in Europe.

If MLS salaries do not become more evenly spread out, we will see many good players deciding to play overseas.  Right now, the majority of MLS players are basically backup dancers while most people watch only for one or two stars.  Why play in the MLS when you can make more money in another country and be paid more appropriately?  Of course it isn’t that cut and dry- the MLS is a growing league quickly gaining international respect.  Plus, it’s in America, and many players would rather play in their home country with the quality of living America has to offer.

However, the MLS has to realize the problems associated with its salary imbalance and work in the future to continue increasing the salary cap so all players are paid like the professional athletes they are.  The United States has the #1 American football league, #1 basketball league, #1 baseball league, and the #1 ice hockey league in the world.  If they truly want to have an elite soccer league and turn the “Big 4” into the “Big 5”, they have to encourage great players to join and stay in the league.

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