Over at FanGraphs, Nathaniel Grow has a good story up looking at the biggest issue facing the Players’ Union as it looks ahead to collective bargaining negotiations with the owners following the 2016 season. It’s not rules. It’s not service time manipulation. It’s that the players, for all of the money they make, are taking home a considerably smaller portion of league revenues than they have in recent memory. They’re even taking home a smaller percentage of revenues than NFL and NBA players, who have historically had far weaker unions.
And it’s not so much that salaries are down — though owners are better about not giving out dumb contracts than they used to be — it’s that revenue is up dramatically and it hasn’t trickled down to the players:
So even though MLB’s television revenues have increased substantially in recent years, relatively little of this extra money is flowing to the players. Instead, teams are largely pocketing these additional revenues as extra profits, raising the league’s overall revenue without a corresponding increase in player payroll. As a result, the new television money is actually lowering the players’ share of overall league revenue on a percentage basis.
One point Grow misses, which one curmudgeonly but insightful person on Twitter pointed out, is that all of that TV money isn’t necessarily being pocketed per se. Rather, a lot of it is going to debt service, as owners are increasingly leveraging themselves to buy teams. It’s a good deal for the owners still and it’s not like this puts them in the poorhouse, but it is worth noting that it’s not a zero sum game between owners and players and that there is another hole into which that money is going.
That caveat aside, yes, the players are getting less of a share than they used to. Grow notes that, gaining back a certain percentage of revenue is no easy trick. Indeed, the only sure-fire way to guarantee that a certain percentage of revenues is spent on salary is to agree to a salary floor structure that, almost necessarily, requires a salary cap for it to come to fruition and to be workable. And the MLBPA has built its entire modern history on opposing such a thing.
Interesting times ahead, but I do think that overemphasizing percentage of revenue on the union agenda is not necessarily the wisest thing. Obviously it’s worth watching and the more a worker can do in that regard the better, but there are other things the MLBPA can and should be sure it doesn’t sacrifice as it thinks about their share of revenue.
The NFL, for example, has a nice percentage of overall revenue going to the players in the aggregate. Any one player, however, also has a non-guaranteed contract and is generally treated like cattle or machinery by that league. Baseball players, in contrast, have pretty good working conditions, security and quality of life. It’d be unwise, I think, for a union full of workers with a limited amount of time in which to set themselves for life to roll back some of those protections in the interest of grabbing extra revenue. That’s especially true when their salaries are still extremely healthy as it is and that the source of that big revenue explosion — TV deals — could be subject to a bubble and possibly even a crash some day given how crazy and unpredictable the future of pay TV is.
Ultimately the people who will make these strategic decisions are paid way more than I am, so we’ll leave the ball in their court. But it’s worth noting that protecting a worker’s quality of life and well-being is not always the same thing as making sure their salaries are maximized.