NFL Teams Are Downsizing, Before They Lose A Cent
>> 5.11.2011
It started in December 2008, when the NFL laid off ten percent of its staff. From the AP article:
Commissioner Roger Goodell said Tuesday that the league is cutting more than 10 percent of its staff in response to the downturn in the nation’s economy that could put a dent in ticket sales for next season.
That’s right: the NFL laid off 150 people because the richest sports league in the world may—or may not—see a dip in ticket sales. Not because there had been, just because there might be. I don’t have actual ticket sales figures, so I can’t tell you exactly how the prophecy was fulfilled, but we can see the reported attendance thanks to ESPN.com’s NFL Attendance database:
| Year | Total | Avg. | Pct. |
| 2007 | 31,164,982 | 69,661 | 99 |
| 2008 | 34,668,552 | 68,249 | 97 |
| 2009 | 34,292,808 | 67,519 | 95 |
| 2010 | 34,014,344 | 66,957 | 95 |
It’s true that in terms of percentage of capacity, there was a dip from 2007 to 2008: instead of NFL stadiums across the league being 99% full, on the average, they were merely 97% full (the spike in total attendance is due to four teams not reporting their home attendance in 2007). Apparently, the specter of looming disaster—only 97% capacity!—spooked the NFL so badly that they had to lay of 10% of their workforce. It’s a good thing they did, because they suffered another horrific 2% drop in 2009! Again, that’s attendance—people who showed up—not tickets sold.
It’s unfathomable to me that the economics of the NFL are structured so that if every team doesn’t sell out every game, people have to lose their jobs. There’s nine billion coming in the door to split amongst a total workforce of several thousand . . . and in order to make payroll, the league has to dump many of the few who don’t draw six-, seven-, or eight-figure paychecks? Secretaries and sales folks had to go on the dole so the NFL could afford Roger Goodell’s $9.76 million 2009 salary—a figure arrived at after Goodell volunteered for a “20-25%” pay cut from off his previous $11M. Math was never my strong suit, but I don’t think one million is 25% of eleven million.
Unfortunately, the teams are following the league's example. According to a 2009 USA Today article, “10-12 teams” had laid off “about 200 people” in advance of the 2010 season. How could they justify mass job cuts in anticipation of an economic downturn, even as revenue, ratings, and interest are at levels never before seen in the history of sport?
Some of the league's layoffs are clearly intended to impact talks on the collective bargaining agreement, which could start up this spring, after the NFL Players Association selects a new executive director to replace the late Gene Upshaw. The owners opted out of the contract last season, arguing it was too favorable to players, who receive nearly 60% of total revenues — an estimated $4.5 billion next season with a salary cap increasing from $116 million to $123 million.
Oh right. Posturing.
A year later, NFL teams continue to cry poor, and it’s again the little guy who’s feeling the pinch. Some teams, like the Chiefs and Jets, have already laid off or furloughed employees this offseason. Yesterday, the Dolphins announced that salaries would be slashed 10-20% for for all “support staff” for the duration of the lockout. So, some owners are making sure that all their employees feel the pinch of the lockout they’re imposing, not just the ones they’re negotiating with. This is particularly egregious coming from Dolphins owner Steven Ross, who in January gassed up his private jet and flew to California to offer Jim Harbaugh a salary “in the $7 million-to-$8 million range.” Clearly, he’s got the money to pay his administrative assistants. He just doesn’t want to.
That several other NFL teams have announced that they will not lay off or furlough staff due to the lockout is both heartening, and damning. Heartening, because it lets us know that not all owners are hell-bent on Scrooging everyone on their payroll, just because they can. Damning, because it proves that the rest of them are doing exactly that.
I have to say, not for the first time, that I’m awfully proud of the Lions franchise for doing this the right way: Tom Lewand announced back in March that there will be no changes in staffing as a result of the lockout. I’m not sure whose call that is; I know Mr. Ford rarely involves himself in the nitty-gritty of league business. But here’s a golden opportunity to tighten up employee costs under false pretenses of hardship, and the Lions aren’t taking it. As mad as I am about the way other teams are approaching this whole mess, I’m proud of the way the Lions are.
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