Wednesday, June 6, 2012

Analysis of Compensation in the MLS

The availability of a dataset on compensation of MLS players allows for a interesting analysis of league-wide compensation (data here in PDF).  The figure above shows the distribution of "2012 Guaranteed Compensation" for MLS players, with the lowest paid players on the left and the highest on the right (there are 549 players in the dataset). You can click on the figures in this post for a better view.

You can see that it is a rather skewed distribution. The graph below shows the salaries of those players who make less than $1 million (which is almost all of them), and it is still skewed.
The average salary in the MLS is $164,000 but the median is only $80,000. The lowest compensated player is $33,625 and the highest (Thierry Henry) is at $5,600,000. There are 328 players who make $100,000 or less.

The graph below shows the distribution of compensation against the league total, which is almost exactly $90 million. It shows that 50% of the league's compensation goes to 492 players and the other 50% of compensation goes to 47 players.
You are probably wondering how the MLS stacks up in terms of its Gini coefficient, a measure of income  (in)equality. That is shown in the graph below (from this excellent online calculator). It shows that the MLS has a level of inequality that might be comparable to Haiti or Bolivia, and much higher level of inequality than found in men's professional tennis. It would be interesting to compare across sports, countries and leagues, but that would necessitate a big data collection effort.

1 comment:

  1. Yikes, this is fascinating. And it is clear that the Rapids' Omar Cummings needs to renegotiate his contract.