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MLS Is To Salary Cap What Donald Trump Is To Humility – Forbes

Bobby McMahon

I cover the world’s most popular sport, the bad, good and brilliant
When is a salary cap not a salary cap? Based on the salary survey published by the Players Union the answer has to be when it is operated by Major League Soccer. The regulation salary cap for each of the 20 teams is $3.49M but……then comes a myriad of loopholes and exemptions.

So many deviations in fact that rather than a cumulative cap of $70M the guaranteed compensation for the over 560 MLS players in 2015 slightly less than $160M.

No wonder a core competency for a MLS GM is understanding the cap and how to manipulate it rather than any ability to gauge playing talent.

Toronto FC are the leagues big spenders with a wage bill of $22.8M. Next come LA Galaxy ($19.5M) and New York City FC ($17.9M). Orlando City SC and Seattle Sounders are both a smidgen short of $11.5M.

These five clubs (25% of MLS) account for over 52% of the league’s wage bill.

The other 15 clubs are all within a relatively narrow band that stretches from $6.6M (New England Revolution) down to FC Dallas at $3.9M.

MLS-Salaries-443x1940
For years MLS would use the average salary as an indication of how players pay was improving.  But the growth in average salaries was driven far more by the introduction of the Designated Player rule.

Sign a couple of players for $5M each, total the payroll and divide by the player pool and lo and behold the average had gone up for another year.
It made for good headlines but it was a grossly unfair representation of what the “average” player was making. The median salary – the number separating the higher half of a data sample from the lower half – is a far better indicator.
MLS-salary
*Guaranteed compensation for players assigned to clubs.

Pay by position

There is also the impact of pay by position. Not surprisingly goalkeepers are the poor relations of MLS as they are in other leagues. The further we move forward the more the average and median salaries increase.

MLS-by-position

Consuming the Pie

The Designated Player rule brought in order to acquire David Beckham in 2007 has proven to be the thin edge of the wedge with the number of such players growing exponentially since then.

But while some have embraced the notion it is clear that others have opted to build in a more homogeneous manner. Some moved down the expensive designated player path only to retreat. New York Bulls are a prime example. RBNY was once home to Thierry Henry, Tim Cahill and Rafa Marquez, but the highest paid player for the Red Bulls is now Bradley Wright-Phillips. Wright-Phillips plundered goals last season in MLS but for years he operated on the margins of the English top flight.

RBNY cut its payroll from $11.3M in 2014 to $3.9M in 2015.

Montreal Impact is another example of a club opting to largely pocket the money once paid to now retired Italian players Marco di Vaio and Alessandro Nesta. Of course, that doesn’t mean that the door has been permanently on such clubs signing designated players, more perhaps a case of keeping the powder dry.

This chart shows how much of each teams’ payroll is consumed by the top earner.

MLS-consumption

The LA Galaxy are now operating with the equivalent of four designated players. The payroll is so top heavy that managing the disparity must be an ongoing tax on the Galaxy management and coaching staff’s power of persuasion.

MLS-LAG
The situation at Toronto FC is similar with three highly paid designated players while the others play the role of something akin to the 1%.

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