I want to call foul on the mainstream media. As I mentioned, a majority of the players in the league make less than $2 million, and yet people like Stephen A. Smith throw around that $5 million figure as gospel. We keep hearing the NBA lockout being described as “millionaires versus billionaires”. But most NBA players won’t become big earners like Kobe and LeBron. Here’s a fun breakdown:
Since the 1990-1991 season 1461 players have entered the NBA and of those:
- 490 — or 33% — never earned $1 million in career earnings*
- and that means… 971 have earned at least $1 million in career earnings*
- 752 have averaged a salary of at least $1 million per year*
- 643 have earned at least $5 million in career earnings*
- 165 averaged a salary of at least $5 million per year*
As we can see, less than half of all NBA players in the last 20 years — the period of time where NBA salaries have been at their highest — have hit that $5 million mark over their entire careers. Just over one third — 33% — of all NBA players in the last 20 years have not even hit the $1 million mark in career earnings. And these numbers have been adjusted for inflation!
Here’s a fun comparison: on average, 1600 people win a lottery of at least $1 million every year! That’s right; the lottery has produced almost twice as many millionaires in the last year as the NBA has in the last twenty years! The popular perception is that once a player enters the NBA they will earn millions and millions of dollars. The truth is that many players don’t hit that high mark.
More importantly, for many of these players, this is their primary source of income and it has cost them many years of hard work. Not only that, but once a player’s playing career is over, that income stops. The number of open announcing and coaching jobs is far fewer than the number of retired players capable of filling them. It’s not as if a 35 year old ex-NBA player can just go back to school and get a new degree that will allow them to re-enter the NBA. No, when an NBA player retires, they either have to find a new source of income, or start taking from their savings.
When people say NBA players are lucky to be paid to play a game, they’re right. You have a much greater chance of becoming a millionaire through the lottery than you do of playing in the NBA. Even so, the payout for getting into the NBA is simply not as high as people think, and there are many obstacles – rookie contracts, injuries, and NBA owners – that may prevent an NBA player from getting paid. So yes, NBA players are lucky, but the truth is they haven’t really hit the jackpot — at least not as big of a jackpot as people think.
-Devin and Dre
*Numbers adjusted for inflation and from Basketball-Reference
490 — or 33% — never earned $1 million in career earnings*
and that means… 971 have earned at least $1 million in career earnings*
752 have averaged a salary of at least $1 million per year*
643 have earned at least $5 million in career earnings*
165 averaged a salary of at least $5 million per year*
Aww, poor things.
And they get rewarded every step of the way. Even if you’re on the side of those who argues that the NCAA exploits its athletes (I think they do), the overwhelming majority of NBA athletes had the opportunity to attend a quality four-year educational institution for free… which leads me to…
NBA players — even those who only play 1-2 seasons at minimum level contracts earn enough money to be set for life. Not necessarily in the sense that they won’t ever have to work another day in their lives, but in the sense that even a minimum rookie deal, in conjunction with a free college education (Assuming the athlete took advantage of that), sets an athlete up at worse for an upper middle class lifestyle for life.
Like everyone in the WoW network, I’m on the side of the players here. The evidence is overwhelmingly in their favor.
Further, I see the reason for this post. There’s a ridiculous amount of misinformation about player compensation out there.
But let’s not fall into the trap that players are being totally and completely victimized here. Everyone who plays in the NBA has enough resources at his disposal to live a very, very comfortable life for the rest of his life.
If 33% of players make less than $1 million, and they still have 40ish years until retirement age, doesn’t that mean that they have roughly $25,000 per year pre-tax? And they get taxed at 50% because it’s all earned in a few years, AND 10% goes to their agent. That hardly seems to be “set for life” to me. Yes they have it good, but set for life is a gross exaggeration.
Ben,
On your aww poor things comment. I feel this is a dangerous attitude. A lot of people are ok letting bad things happen to people just because they’re better off than a lot. The “they’re just lucky to have a job” mentality scares me when I see companies treat people poorly. That has definitely happened here.
On the college. I still disagree with this. It is not a free education. They work for it and it is in fact detrimental. I had a part time job all through school but it’s not like Target ever said “You know taking Calc 2 interferes with practice. You want to keep your job right?” Not only that if the student gets injured or declares for the draft and fails they lose their scholarship. It’s not free, it’s not guaranteed.
Finally I’m skeptical on the set for life even on a min rookie deal. If a players earns a million dollars you can lop off 40-50% for taxes + agent fees. Factor in the fact that they’re young, which is when we make our dumb decisions, and as Dave has pointed out many have people expecting to benefit from their windfall. Many players go bankrupt.
My main point I hope is that when NBA players are all portrayed as super rich players earning $5+ million every year and that just isn’t as true as people think. The players are getting crushed in the PR battle and this is one of those points they should counter.
“Aww, poor things” is exactly right. Nobody should feel sorry for the NBA players, no matter if they are in the $1 million category or in the Kobe/Garnett category. $1 million for *playing a game* is an absolute windfall. They don’t have to work hard – they have to practice and play games. They are supremely talented, and should be fairly compensated for their talent, but let’s not kid ourselves that they are really *working hard*. I also don’t think that the comparison to lottery winners is apt. There are many more people playing the lottery than basketball players.
I don’t see anybody else like this, but I’ve steadily moved away from the players’ position as time has gone on and the owners’ offer on BRI split has increased. 50/50 seems immensely reasonable to me. And I am on the owners side on many of the “system issues” – there ought to be a hard cap, for instance, for fariness sake.
I feel this still boils down to a PR battle. Playing in the NBA is a job. It does require work. It’s a very weird world where people think they can call something fun and then get upset with a person for asking for money. Imagine if in the regular world your boss could dock your pay every time you did something you enjoyed because heck! you were lucky enough to have fun at work, why should they pay you too?
Mike Gollic on Mike and Mike had a good point about football. He said many players wouldn’t have retired if all they had to do was play on Sunday. He said it was all the things during the regular week that he couldn’t take anymore. NBA players do have to practice and do have to do things that aren’t enjoyable (are we really going to try and sell working out as enjoyable? Also travel is not fun!) Yet as fans we see them play a 48 minute game and forget all of that and the history to get there very quickly.
Dre is absolutely right, A.K.S. Do you have any idea what goes into becoming an NBA player? They have strict training regimens, strict diets, strict practice schedules, strict travel schedules. They have clauses in their contracts that control what they can and cannot do during their free time (for example, skiing, surfing, or riding motorcycles). Despite what many people think, becoming an NBA player is more than just genetics — without years and years of hard work, these players would probably have ended their playing careers at high school.
The same is true of any athlete at the highest level. I thought that we had moved away from the outdated ideas of amateurism that pervaded our culture in the early 20th century, but I guess not.
Should people get paid for making music? Acting? Directing movies? Designing video games? Yes. People in these fields — professional sports included — are simply making what the market allows for. If you really have a problem with the salaries in all these professions, feel free to make your voice heard in the only effective way — with your wallet.
Why is he taking salaries from players during the 1990-91 season when they weren’t even operating under the same CBA? This seems fishy, and I would be willing to bet that the more recent numbers do not support the premise. It also does not mention if the players included in the sample are ones that were signed to 10-day contracts which would drastically bring down the average. Lastly average salary is not a good indicator of total earnings because there is no data about the average length of the players career.
Avon,
Man who is this “he” you keep referring to? He sounds ominous!
Alright so I did include a link at the top (and I referenced the stat) that shows salaries from the last season if you want more contemporary. I went back to 1991 because that is the longest back salary data goes that is continuous (there is 1980s data at Basketball-Reference but 1990 and 1987 are missing) I did not use aggregate averages in any of the stats, which is what many people do. By including a 10 dayer with Kobe in “average salary” you skew the average. I just counted the players that beat the threshold. The point on average salary is just to show that most players (thanks a lot to rookie contracts) don’t even average $5 million a career.
Devin, I think you are overstating things a bit. We know, for example, what NBA players eat. For the most part, they don’t follow “strict diets” – they eat at the Cheescake Factory. I’m betting that 95% of NBA players have worse diets than I do (to be sure, the expend a lot more calories than I do). They have strict work and travel schedules – big deal. So do I. And so does 90% of working America. And let’s not forget what they are doing a good deal of the time they are at work – playing basketball! Something that most of us would do for free. The worst thing you can say for their jobs is that they are extremely high pressure, with failure being extremely visible. And that sucks – God knows I would hate it if I screwed up something on my job and 18,000 people booed and hundreds of thousands more watched the screw up on TV. But still – it’s basketball.
As I said, these are very, very talented people, and they should be compensated in accordance with their talent. But they certainly have hit the jackpot.
Hi Dre,
My apologies, I didn’t realize there was any opportunity for back and forth. My concern with the information provided is the benchmark is set very high. To say that most players do not earn $5MM over the course of their career is misleading in terms of their overall financial standing in the US. With all of the talk about the disparity between rich and poor in this country, even making the minimum NBA salary puts them in the top 1% of all Americans. Most people would bend over backwards to make this amount of money. Yes it is still a career and yes the players work VERY hard (most of them at least) to earn their money, but I still consider them to have hit the jackpot. According to this site:
http://www.basketballelite.com/index.php/sports-business/nba-business-minimum-nba-salary/
The minimum salary for last year was $473k. It would take me more than a few years to make that amount of money.
I heavily side with the players over this lockout but to say that NBA players are not well off is just not true.
Avonhun,
Oh don’t get me wrong. I absolutely think NBA players are paid very well and by virtue of the small number of them they are VERY lucky. My key concern is how the problem is stated. People like Stephen A. overstate how much players make (hence my $5 million benchmark) and some understate how difficult it is. For example as we can see from the comments some say the players “do no work” and just “play a game” as opposed to giving any credit to the hours and sacrifices required to actually get an NBA career. My goal was to point out how these perceptions are off.
A.K.S., if it’s so easy to be an NBA player and they’re set for life, then why aren’t you one? Oh that’s right, because you didn’t put in 15+ years of work to get there. And when you finally make it, sorry, you’re not as good as you thought. Yes you did well in high school. And college. But you weren’t up against NBA players. So we’re gonna cut your non-garuanteed contract after 5 games. Good luck in Europe. Magnum Rolle got cut before the season even started. Heaven forbid you get injured.
It’s hard work, and a thousand people are out there trying to get YOUR spot. The problem here is that the NBA bills itself on it’s stars, and so everyone associates “NBA player” with Lebron, Kobe, Howard, etc. Half the players that come into the league have non-garuanteed contracts. Not everyone is a Lebron or Bismack Biyombo, with a body so natuarlly acclimated to basketball that they could have stumbled into the NBA half asleep.
Dre,
That is a fair point, I misread the intentions of your article. It is true that there are many guys in the league not making marquee money. I often hear about ex-NBA players who sell cars, own restaurants or host radio shows to make ends meet after their time in the league. The lower echelon players are lucky that they typically represent the league in labor negotiations rather than the highly paid stars or things would probably go very differently.
This is the strange irony of the lockout. The two actual important financial issues for each party have only a little to do with the opposing party, and a lot to do with their fellow owners or players.
I have no doubt a lot of owners are losing money, for the simple reason that if you track reported revenue since 2006, the bulk of revenue growth occurred in the 6 biggest markets, while remaining flat in half the league; while both external costs and player salaries (by virtue of the 57% BRI and minimum salary) increased. But that means the single biggest issue for owners is revenue sharing, because regardless of the eventual BRI paid to players, if the revenue trend continues small market teams eventually start losing money again.
Similarly, because players will get a fixed percentage of BRI regardless of the various salary restrictions, their main effect is on the distribution of money between players. To the extent that players on rookie contracts and superstars are underpaid, and veteran journeymen overpaid, it is mostly a problem internal to the players. I’m actually surprised that they have a united front for a policy (no hard cap) that benefits a minority of players, but perhaps most players on rookie contracts have aspirations that their pay day will come.
I think one very important part is left out here. In discussing how “little” most players actually make over a lifetime, you bring up another issue. Let’s say hypothetically the NBA negotiations deteriorated in such a way that the owners decided to scrap this season and the next, just to prove a point. What would happen?
The NBA owners for the most part wouldn’t skip a beat. They have made their money elsewhere and, as it has been stated in many ESPN and other articles, most of them purchased the franchises as a toy or trophy. The NBA doesn’t make or brake them financially. However, the NBA makes or brakes the finances of THOUSANDS upon THOUSANDS of individuals associated with it, especially on the player and facilities sides. You may say, “oh other investors will step in and create a new league.” This is true, eventually. But it would start of slow, with only a fraction of the teams. Who’s that going to benefit? Only the best players. What happens to the draft process? The cities that don’t get teams back?
I’ve been a high school teacher since 2003. Do you know how many students lives are already at that age completely revolving on hopes of becoming an NBA player? Many of them care NOTHING about grades with the exception of doing the minimal required to pass. These then turn into college athletes with no desire or value for education. So, you say they don’t have time to focus on education. That’s a cop out, because most of them wouldn’t anyway. All you have to do is listen to young professional athletes everyday. Ignorance and evidence of their value system spews out on a regular basis. And don’t get me wrong, it’s not totally their fault. The media, schools, and communities are more to blame than anybody else. But, my point is this. The money they make in the NBA is a privilege. Most of the guys making that ,minimum salary have no business earning that money in what we might call “real world” expectations relative to education and work ethic. Some people have said things here about their work schedule and difficult life. Really?
There’s other people who spend their entire lives working toward their goals, having to limit their activities, having little time to themselves, and incurring massive debt. They’re called doctors. And not just the “Nip Tuck” billionaire specialists. But the ER doctors working 80 hour work weeks to make less than an NBA rookie who’s idea of a rough life has been practicing a lot and traveling the country playing basketball. I think people need a reality check. Without the NBA owners, how many people’s lives would come crumbling down? Or communities for that matter?
There’s a reason why everybody wants to be the “boss.” Because you get to make the rules. And or course labor unions are their to protect against injustice, and they should be. But here’s the injustice the NBAPA is claiming:
$2,000,000,000.00 divided among 520 players (each year) isn’t enough. WoW.
Eaviles,
Wow didn’t quite get your point there. Let’s start pro-owners
However, the NBA makes or brakes the finances of THOUSANDS upon THOUSANDS of individuals associated with it, especially on the player and facilities sides – So the issue here is do they help? Sure thousands of people work for them but do NBA owners help the local communities? Maybe externally but from an economic standpoint getting an NBA team has not been shown to help. Why would it? It’s only in use 41-57 times a year for NBA games. What’s more tax payers tend to pay for them. So the community pays itself.
The NBA owners are responsible for helping thousands. So sure the NBA shuts down thousands of people lose jobs, but are you telling me they can’t go find other jobs? What’s more the economist have shown that just because sports leagues shut down it doesn’t mean people stop spending money on entertainment. So no NBA means other businesses get a jump in business and hopefully hire.
Final point – There’s a reason why everybody wants to be the “boss.” Because you get to make the rules. In this case your argument is actually that players should be greedy and want more money (see Michael Jordan) so they can be owners. Yet you’re calling them greedy. I don’t quite get it.
Eaviles,
Onto the players
So, you say they don’t have time to focus on education. That’s a cop out, because most of them wouldn’t anyway I think we got tangental here but I agree. The NBA and NCAA have a “minor league” where they pay players in “education”. The issue is most of the players don’t want and the school wants them focusing on basketball. So my point there was saying potential NBAers get a free education was not true. You seem to agree. Why can’t they just jump straight into the NBA? More risk for the owners and more expensive. Make them play a season or two in college for nothing and it helps evaluation.
I still jump back to the same point. You are simply doing a PR spin. By claiming that it didn’t require any hard work to become an NBA player or saying that none of it is hard we can call them privileged. I am content to call them lucky. That said just because we don’t like how well off they are doesn’t mean they didn’t work to get where they are. You said you’re a high school teacher? In some third world country a person has worked just as hard as you to have a much worse life. Should we give your money away to a richer person?
You also did a very weird thing calling out the ignorance of players and their value systems. This is kind of odd. You essentially vilify them to justify taking their money. I may not agree with how NBA players spend their money and how some act. I in fact would love it if the league did more to help with money management and guidance (as many players enter at around 18-19). That said simply saying “Well I don’t like their values, let’s take their money” is a bit strange.
$2,000,000,000.00 divided among 520 players (each year) isn’t enough. WoW. – Let’s phrase that another way btw
$2,000,000,000.00 divided among 30 owners (each year) isn’t enough? WoW!
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It seems everyone is in agreement that the players have a pretty great deal (how great that is and how much they had to put into it are more debatable).
The big market owners also have a pretty sweet deal. They make a great return on investment while getting to own their trophy NBA teams.
The small market owners may or may not have a decent deal. There is a lot of debate out there about whether they are losing money and how much. Also about whether an NBA team should be seen as a business or more like an aesthetic prize to own.
My point is that all the players have a great deal (some better than others) and even with a lower revenue split they will. It seems fair to move the deal to the point where the small market owners at least have undebatably a decent deal if you aren’t really hurting the players big time in the process.
I think more changes are necessary than the BRI split. There should be more revenue sharing. And if there were a way of pulling off a profit split instead of a revenue split, that would also seem better. But moving the BRI split a few more percentage points down seems like it will help the owners (who have more leverage) more than it will hurt the players. So I approve of that change.
My problem with a revenue split is basically this:
Imagine a marketing team comes up with a way to spend $1M that will bring in $1.2M more in revenue. Normally, that should be a great proposal. 20% return on investment is nothing to sneeze at. But if an owner follows through on that proposal, he spends $1M and (let’s say the split is 50/50) brings in another $600K for a net loss of $400K.
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So what? My point was that they have the resources available to them to make it otherwise. The fact that many of them don’t choose to utilize those resources properly is not an argument against my original point! It’s another, “Aww, poor players…” argument!
Again, I’m on the side of the players in this lockout. But I’m begrudgingly so. The owners are seeking to exploit them and take from them unfairly. The best arguments for the players explain how this is the case — including your argument here about “average” income for players. It’s a good argument.
My point is that it’s being oversold just a bit. We don’t need to feel sorry for these guys. They make hundreds of thousands of dollars at minimum to play basketball. They have to pay agents. Who cares? Hundreds of thousands of middle class workers have union dues to pay. They have to pay taxes. Who cares? So do the rest of us.
I agree with this 100%. I’m not disputing the facts, just disagreeing with the presentation.
Take a rookie scale deal for a second rounder last season, and then subtract 40% for taxes, agent fees, union fees, etc. It’s going to take me years to earn that much money (and I’m on the social profit sector, striving to make public life better, not providing entertainment).
Anyone with even a basic grasp on personal finances could take one year’s worth of that salary and develop a long-term financial plan that would all but guarantee a comfortable life. I’m not saying such a player never has to work again. I am saying that if you take $300k and invest it wisely (in education, in property, in long-term financial investments), you will have very little to worry about.
This doesn’t justify anything the owners are doing (the owners disgust me), but it does make me a little less sympathetic with the players. Millionaires and billionaires squabbling over billions — that’s what this lockout is. I don’t feel like I need to feel sorry for any of them, no matter who’s spinning and winning the PR battle. The fact is that they’re all ridiculously privileged and ridiculously rich, no matter who wins, and no matter how “just” the eventual outcome turns out to be.
@brgulker:
As others have tried to explain, you’re sadly mistaken about players having all the resources to be set for the rest of their lives. If that was the case, then why do 60% of players go broke w/ in 5 yrs of retirement?
Do you really believe that 3 out of 5 middle class ppl w/ all the resources they need to be set for life would blow it?
Also, they don’t get a free ride at college for 4 years. They sign 1-year scholarships. 1 year of college is not enough to ensure someone has enough resources to be “set for life”.
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