## Tuesday, February 19, 2008

### NHL Economics

Seth over at Empty Netters, found this interesting article. Apparently, NHL Players are making more now than they were back in 03-04, before they took that 24 % roll back on all salaries.

What always kills me when people compare year to year spending is their complete neglect of inflation. Just because your grandfather regales you with stories of the fudgy wudgey man selling him ice cream for 5 cents back in 1938, does not mean inflation is only a long term effect. Especially this past year, when the dollar weakened significantly, there has to be some sort of conversion.

In the article, it is claimed that the total league wide payroll this year is $1.4 billion, compared to$1.34 billion in 03-04. Assuming 15 % inflation from 2003-2007, that $1.34 billion translates into$1.54 billion in present day terms. What it all means is that players are still getting paid 9.1 % less than their 03-04 counterparts. Its a lot less substantial than 24 %, but I'd also like to believe that the NHL is doing better financially.

Maybe I'm an idiot and they were actually talking in terms of the Canadian loon (it is a Canadian paper after all), but I'd like to think they try and keep some consistency when dealing with finances in sports. Regardless, the amount the players are making relative to total league revenues is what really matters, but I'm too lazy to try and find that out.

#### 1 comment:

pauliebleeker said...

econ and sports Sam? you're like the utility blogger. this whole inflation thing is really good insight when it comes to labor relations in sports...and elsewhere. good job picking up on that.