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Is the gap widening?

Analysis of rosters shows growing divide in player salaries

Amy Trask, the former Oakland Raiders chief executive officer, recalls speaking to football operations officials shortly after the NFL’s 10-year collective-bargaining agreement passed in 2011, who cautioned her the deal would destroy the middle class of team rosters. That prediction may have proved prescient.

The groundbreaking pact, which will enter the halfway mark in the next season, has fulfilled many of its objectives: revenue growth, player health and safety reform, and an increase in benefits.

Whether an unintended consequence, however, NFL rosters are increasingly populated by very highly paid stars and those earning closer to the minimum levels. Sports teams in all leagues always have had wide ranges in pay, but the 2011 CBA exacerbated the gap. Call it the NFL’s version of income inequality.

“I am not sure there is [one] answer why,” said Trask, who left the Raiders last year after 26 years and is now a commentator for CBS Sports. “The structure of the pay scale of the new CBA, the salary cap, the quest to sign the very high-end free agent and the dollars that demands.”

NFL rosters are increasingly populated by very highly paid stars and those closer to earning minimum levels.
Photo by: Getty Images
The CBA sought to fix the problem of huge bonuses paid to incoming rookies, many of whom did not play well. And no doubt it has done that. In the year before the CBA, the first pick in the draft, Sam Bradford, signed a contract guaranteeing him $50 million. Last year, the No. 1 pick, Jadeveon Clowney, signed a contract guaranteeing him $22.2 million.

The CBA created rookie pay slots. And maybe as importantly, it defined and set the incentives allowed in contracts.

“It’s taken negotiations out of most contracts,” said agent Leigh Steinberg, who created one of the first incentive-laden contracts in 1993 for Drew Bledsoe. “There are no voidables, no options, all creativity has essentially been taken out.

“My daughter could negotiate a contract.”

Jack Bechta, an agent who makes a living off the non-stars on rosters, said draft picks are more valuable to teams now because of the length of time they are twined to clubs, and the set pay. As a result, teams are more apt to stick with several of them than a higher-priced veteran.

“The swing linebacker who used to get $3 million, that guy is a minimum guy now,” Bechta said. Minimum pay is based on years of service.

According to data put together for this story by Overthecap.com, a website that tracks NFL player salaries, in 2009 players earning $1 million or less represented nearly 54 percent of the league; last year the figure topped 61 percent.
Meanwhile, players earning between $1 million and $7 million annually represented 42 percent of the league in 2009, and 33 percent last year, according to the Overthecap.com data. Figuring those numbers for a 53-man roster, that would be a difference of five fewer players making between $1 million and $7 million.

When looking at the very top, however, the figures are more favorable now. In 2009, players earning $10 million or more annually consumed 1.37 percent of NFL rosters. Last year the figure topped 2 percent. Players earning between $7 million and $10 million annually took up 2.7 percent of NFL rosters in 2009, and 3.3 percent in 2014, according to the website’s data.

Whether the league or NFL Players Association consider this an issue is unclear; neither would comment on this issue.

The CBA roughly cut the players’ take of league revenue from around 53 percent to 47 percent, with the owners’ premise that by increasing team profit margins, they could invest and grow the business. And no doubt profit margins have increased, by most accounts from the low single-digit percent range in 2010 to the low double digits now.

Have those profit margins helped the players? League revenue is up from around $8.5 billion in 2010 to an expected $11.5 billion this year (and that figure could easily grow with a new Thursday night television package). So far, that has not translated much into the salary cap, which rose from about $121 million in 2011 to $133 million in 2014 (it likely will hit $145 million this year).

It’s unclear if the rise in the cap this year will halt the widening pay disparity on NFL rosters. Some of that has to do with the pronounced demand for skill position players, like quarterbacks and wide receivers. Take the Detroit Lions. Last year, their three highest-paid players — quarterback Matthew Stafford, wide receiver Calvin Johnson and defensive end Ndamukong Suh — earned $46.7 million, or about 35 percent of the salary cap for the 53-man roster.

The cap doesn’t tell the whole story, however. The players’ share includes benefits, which are rising at a far greater pace than the cap. “There is a whole new category of benefits, from helping players return to college, to medical,” Steinberg said. “And that is great for the average player.” Benefits are approaching $30 million annually per club, up from a mid-to-low $20 million range before the CBA.

The NFL on this point defends the labor pact for doing what the owners said it would do: generate new revenue and make the pie bigger. A league spokesman pointed to three new stadiums and 12 venue renovations since 2011 as evidence that owners are now investing. Other areas include investment in the in-game experience, expansion of international games, a new over-the-top network, and large grants to make the game safer.

And by signing a 10-year, no opt-out labor deal, that gave the media networks confidence to sign long-term contracts, said Marc Ganis, a sports consultant with close ties to NFL management.

The disparate levels of player pay come at a time when the relationship between the union and league is as frazzled as it was during the contentious lockout of 2011. The union has criticized the league’s move on a new personal conduct policy, and has portrayed the league as being power and money hungry.

Be it potential playoff or regular-season expansion, or the image of the league, Ganis explained, the poor communication between labor and management is hurting revenue growth.

Joe Banner, a former team executive, said it “is not good for either side to be squabbling; they should be spending time enhancing the league. If time is being taken away from doing that, it doesn’t serve anybody.”

Experts are not sanguine next season’s cap growth will change matters.

“[T]he rich will continue to get richer more rapidly than the lower- or middle-paid players in the league will, as the minimum salaries continue to rise by only $15,000 per year, even though the overall team salary cap is increasing at a much greater rate,” said Michael Ginnitti, founder and editor of Spotrac, a website that tracks athlete salaries across the major sports.

Jason Fitzgerald, who runs Overthecap.com, is more blunt.

“The general takeaway is that bigger cap players are rising in the NFL,” he concluded, “while the $5 [million] to $7 million player is falling away, as is the $1 [million] to $3 million player.”

With little productive communication between union and league, even if this were an issue that one side wanted to address, chances are slim of a solution. So the next chance to address presumably will come in 2021, when the current CBA is due to expire.

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