The salary cap in the NFL is up to $208 million per team for 2022 and continues to rise each year by about $20 million. This salary cap sets a maximum budget that each team can pay their entire player roster. Even with this rise, the wage gap between the minimum salary and the highest individual salary for NFL players has continued to widen.
The current minimum salary for a first-year player is $705,000 meanwhile, the highest average salary is over $50 million (Aaron Rodgers, Quarterback, Green Bay Packers). That is quite the jump from the gap a mere five years prior. Five years ago in 2017, Matthew Stafford (Quarterback, Detroit Lions) held the highest average salary throughout the league at $27 million, meanwhile the league minimum was $465,000 in 2017. From 2017 to 2022, the minimum salary increased about 50% while the highest salary increased over 80%. The gap between the minimum and highest salary widened by $22.7 million over that same period. This gap is not only widening in average or total salary, but we are seeing a more uneven distribution of the salary cap meaning star players are getting paid a larger percentage of the salary cap than in years past. A recent article in Sports Illustrated supports this thought. The article is about the long snapper position, a highly skilled, yet low paying position in the NFL. According to this article the “highest earners at their position, (long snapper position) accounted for about 1% of the league’s $120.6 million salary cap in 2012, that figure dropped to 0.66% entering the 2022 season” (Prewitt). While this is only one position, it certainly highlights that the bottom of the roster players in the league are not receiving the same compensation they once were.
The top quarterbacks drafted in the last few years, Lamar Jackson, Joe Burrow, and Justin Herbert are coming up on first time contract extensions that will likely top Aaron Rodgers’ $50 million average salary. This means we could see this wage gap between the minimum salary and highest grow even further apart. Who knows how much this gap will grow by 2030 when the collective bargaining agreement expires…
This is not an unsolvable problem. One solution would be to structure the salaries more like performance-based NBA contracts. In the NBA, an invitation to the league’s All-Star Game or being voted to the All-NBA team at the end of the season creates escalators to larger potential contracts. In this case a player would have tangible marks to hit to receive a larger contract. Instead of having the normal back and forth negotiations, a player would have a preset contract value based upon performance. A player like Lamar Jackson Quarterback, Ravens would not have to negotiate his contract, but rather there would be a predetermined amount based upon his career accolades. The compensation in his contract would reflect his MVP award, making the Pro Bowl (the NFL’s equivalent to the All-Star Game), and being voted to the All-Pro Team (similar to the All-NBA team). He would be eligible to have a higher value contract than a player like Jimmy Garoppolo Quarterback, 49ers who has not been recognized with any of the same honors. The same would go for a player with a lower salary like Jeremy Reaves Safety, Commanders (average salary of $762,500). He made his first Pro Bowl and was voted to the All-Pro Team for the first time this season. His next contract would have a higher preset value than in years past when he did not have these accolades. This would give a player like Jeremy Reaves tangible marks to hit to increase the value of his future contract. Having performance-based contracts could allow for more players to maximize their earnings in the NFL. It would change the current landscape of the NFL where quarterbacks and a select few other players are dominating the salary cap.
For more information on this topic, please contact a member of Withum’s Professional Sports Services Team.