Editor's note: This story is revised from the print edition.
Major League Baseball's free-agent class has seen salaries fall a collective 26.6 percent this off-season, driven down by tighter team budgets, a high number of available players and the continued effect of MLB's new collective-bargaining agreement, according to an analysis of the new deals.
The average annual value of 153 free-agent contracts signed through last Wednesday is down more than $796,000 per player to $2.19 million of guaranteed money. That compares with an average 2003 salary of just under $3 million for those players, and marks a second straight year of decline for MLB's free agents (see chart).
As of early January 2003, contracts for the 65 free-agent signees of last year's class had dropped by an average of more than $626,000 per player, or 16.5 percent from the year before.
The declining fortunes of this year's class come as union leaders and player agents are watching the market closely for signs that salaries are being artificially depressed. MLB Players Association officials did not comment prior to press time.
MLB and team executives, however, contend that this year's decline is merely the result of a combination of greater supply, the amount of debt the industry is carrying, and the league's new collective-bargaining agreement, which took effect in 2002.
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| Kevin Appier: Down $11,200,000 |
"There has been very active bidding for players," said MLB executive vice president of labor relations Rob Manfred, "and despite that fact, I think you've seen a continuation of some price correction, which really shouldn't shock anybody."
Players in the free-agent class of 2001-02 who had signed new deals by mid-January 2002 averaged a collective salary increase of 23.6 percent, or more than $736,000 annually per player.
Of the 153 players who signed deals this year, 80 took pay cuts, which is the same percentage (52.3 percent) as last year, when 34 of the 65 players saw their annual salary drop. Forty-one of 80 players took cuts of 50 percent or more.
The average age of the 80 players taking pay cuts is 33.2, compared with 34.9 last year.
Some of the more concrete explanations that helped account for last year's drop-off — an aging group of veterans and the relative absence of high-impact free agents — were less of a factor this year. The average age of free agents who had signed as of mid-January last year was 34.5, while the average age of this year's signees is 33.
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| Miguel Tejada: Up $7,000,000 |
Further, whereas last year's list of marquee players did not extend much beyond Jim Thome and Tom Glavine, this year's class includes a notable list of in-their-prime stars, including Vladimir Guerrero, Andy Pettitte, Bartolo Colon and Javier Lopez. Other high-profile players in the class include Gary Sheffield, 35, who signed with a new club, and veterans Ivan Rodriguez and Greg Maddux, both of whom had yet to sign as of Wednesday.
Also affecting this year's class has been the influx of "nontenders," the term for players with three to five years of experience whose rights-holders decline to offer them contracts, thus making them free agents and ineligible for arbitration.
The increase in nontenders in the last two years has helped flood the free-agent class and made belt-tightening club executives more inclined to cut their own players loose, trusting that the open market will yield cheaper alternatives to arbitration.
"We're probably much more cognizant of trying to get a bang for our buck," said Dave Littlefield, general manager of the Pittsburgh Pirates. "[Clubs] are looking at a variety of alternatives that in some instances may not be viewed as a perfect fit, but may be a good alternative relative to cost."
Littlefield said that for the Pirates, who are trying to reduce payroll to the high-$30 million range from last year's $50 million-plus payroll, the approach is a matter of simple economics: Attendance and revenue have declined for the Pirates while expenses have increased since the club moved into PNC Park in 2001.
"You hear at different times that there's outcry with the idea that, 'Oh, they're going to run [a sports team] like a business,' " Littlefield said. "From the Pirates' standpoint, we have to run it like a business. It's what we should be doing."
Senior writer Bill King contributed to this report.
For information on each of the 153 MLB free-agent deals analyzed in this report, click here.
