The battle between Major League Baseball and Minor League Baseball continues, as MLB is still seems set on attempting to eliminate a few leagues, as well as a handful of full-season teams for reasons that don’t exactly pass the sniff test. One of the reasons that MLB has continuously stated is that they want to raise pay for minor leaguers. Of course the only thing stopping that from happening was their own unwillingness to do so. The Cincinnati Reds are responsible for paying all of their minor league players, just like every other organization is responsible for playing theirs. Nothing about the way MiLB works was preventing the teams from changing how much they were paying players – the Toronto Blue Jays actually increased wages for their minor leagues in 2019.

Earlier today it was announced by the Associated Press that Major League Baseball that raises would be coming in 2021 to all levels of the minors. From their memo that was sent out from the commissioner’s office to all of the teams:

Level Old Pay New Pay
Rookie $290 $400
A-Ball $290 $500
Double-A $350 $600
Triple-A $502 $700
Pay per week

Now, it needs to be noted that the old pay was the minimum, as is the new pay. In the past, players that were repeating a level got a small boost in pay per month. Let’s also note that this is the pay scale for players who are still on their original contract. Once a player reaches free agency they can negotiate their salaries and they do not have to be paid the minimums. Players who are on the 40-man roster get paid differently than this, even if they are in the minors. And of course, players are not paid for spring training, extended spring training, or during the offseason. They are only paid during the season in which they are playing games that count in the standings.

Emily Waldon of The Athletic and Baseball America made an astute observation on twitter this afternoon about the timing of when the pay scale goes up:

We do not know how the minor league affiliation situation is going to play out yet. We do know that it really feels like Major League Baseball is going to fight pretty hard to cut out non-complex level rookie-ball teams. But let’s look at how both scenarios would play out with regards to pay and what it means to organizations.

Let’s start out with the breakdown from the Cincinnati Reds perspective. It’s important to note here that the Reds have three rookie-level teams, and some organizations only have two of them – so the overall numbers aren’t going to be the same for each organization.

Weeks of Play Total increase for player Number of players Increase to MLB Team
Rookie 12 $1,320 120 $158,400
A-Ball 21 $4,410 60 $264,600
Double-A 21 $5,250 20 $105,000
Triple-A 21 $4,158 20 $83,160
Total 220 $611,160

Let’s talk a little bit more about the specific numbers here. Starting with the number of players – I counted 40 players per rookie-league roster. The limit is 35, but that doesn’t include guys on the injured list, either, so I added five per team to play it safe. In A-ball I counted 30 players per roster, though that number probably isn’t quite that high.

In Double-A and Triple-A I only counted 20 players each. The reason those roster numbers are so low, and while the 30 per team in A-ball isn’t quite right is that those rosters are going to have some free agents on them. They get to negotiate their salary with their second contracts. Likewise, guys on the 40-man roster get different pay, too – and a majority of the free agents and 40-man guys will be in Double-A and Triple-A. The increase won’t come to any of those players.

So, with all of that out of the way, the increase in pay for a Major League team, if they do not eliminate any teams, the Cincinnati Reds would be taking on roughly the same price paid to one Major League rookie contracted player per season moving forward.

But what happens if Major League Baseball were to go through with their plan to eliminate the teams that they initially proposed? Well, that’s where things get a little bit tricky. Some organizations are running two teams out of their spring training complexes at the rookie-ball levels now. If every team were to do that, while then only having full-season ball teams everywhere else, then the increase would be roughly $558,360 in additional spending (down from the $611,160 shown above). But if each organization were limited to only having one complex level rookie-ball team, then that number would drop even further, down to $505,560 – give or take a little bit depending on exactly the number of free agents a team had signed for the year.

No matter how you want to slice things – eliminating two rookie-ball teams isn’t saving a team much money – at least in terms of player salary. There’s plenty of money that goes into the other side of things. The Reds, or any other big league team is still paying for things like coaches, managers, trainers, low-level employees (video guys/Trackman operator) at those levels, too. There are also a few other expenses that go into it, too.

Forbes makes estimations each year based on the values of each team, and within that they break down what goes into that. One of those things is the revenue for each team. For the Cincinnati Reds, the number calculated for their revenue in April of 2019 was $257M for the year. The organization would see the increase in minor league player pay be 0.2% of their yearly revenue. And that number is only if no teams are eliminated.

Zero point two percent. That’s a rounding error. And that’s for the Cincinnati Reds, who are one of the lowest revenue teams in the sport, and who also have more teams than some other organizations in Minor League Baseball. Most teams are going to see a lower percentage of their organizational revenue than that. This is also assuming that it’s just the Major League Baseball organizations that are going to cover that. Rob Manfred may have insinuated at the Winter Meetings that the minor league franchises should cover a part of the proposed increase in wages for the players.

“Obviously there is a way to pay people more without reducing the number of franchises,” Manfred said. “I think the question there becomes who should bear all of the costs associated with the player-related improvements that we think need to be made in the minor league system.”

It’s great that something is FINALLY happening to make things a little bit better for minor leaguers. Having an extra $440-1000 is a real benefit, one that absolutely can help in a meaningful way. But take the guys in rookie-ball, for example. If they are a player who has wasn’t just drafted, that means that they didn’t get paid in spring training. It means that they didn’t get paid in extended spring training, and that they don’t get their first “baseball check” of the year until the very end of June. And when that check comes in, it’s $400 a week. Some of that money is going to their uncle Sam. Some of that is going to cover clubhouse dues (this can range anywhere from $5-10 a day in most organizations, though a few organizations cover this themselves).

So let’s just be nice and round that off to $100 a month towards clubhouse dues. Before taxes, because that’s going to differ in each state/city that a guy is playing in and after the $100 for dues, a guy who is assigned to the AZL Reds, Greeneville Reds, or Billings Mustangs is being paid $1,613 a month.

Can someone make that work? Sure. Particularly if they are single, with no children, no parents/grandparents/other family that is in need of financial support, and they want to take on a roommate or two. But given the hours that they work, the skill required for their job, the fact that unlike nearly every other job on the planet – they get assigned to a town/city, have to travel for work, and don’t get to choose where to work that job, they are still being drastically underpaid.

I’m not sure what the “right” amount of pay should be for Minor League Baseball players. But even with the increased salaries that are coming in 2021, it doesn’t feel like it’s nearly enough – especially at the lowest levels. Major League Baseball has talked about making things better for minor leaguers, and to be fair, these increases will help do that. But if they really wanted to improve their lives, the increases would have been more than they are. These guys are still going to need to go into the offseason and train for their baseball jobs, but also have to go get jobs in order to support themselves – all while focusing less on becoming the best baseball players that they otherwise could be.

Selling insurance, or being a substitute teacher – while being fine professions – aren’t exactly the same as being able to spend time working with a trainer to improve your perceived weaknesses. Working a 9-5 leaves less time in the offseason to hit the cages, the gym, the track to get in some cardio – whatever it is that an athlete needs to do in order to up their game. It just seems penny wise, pound foolish from where this particular writer stands.

9 Responses

  1. MK

    If money is the real issue you have to wonder why they believe the complex teams are the way to go. The team owners of the Appy and Pioneer Leagues buy the uniforms, pay for transportation and game expenses like balls umpires etc. Most obviously make this up with ticket sales,sponsors, etc. All the expenses are the teams on the complex leagues.

    Reply
    • Doug Gray

      I believe that 6 of the 10 teams in the Appy League are owned by the big league club.

      Reply
    • Doug Gray

      If you mean clubhouse dues – I honestly don’t know for spring training. With offseason workouts, those are done on the players time wherever they live. There’s no clubhouse.

      Reply
      • Scott Sammons

        Currently the minor league pay for off season workouts and spring training is $10.00 per day. This is criminal!

  2. Michael Smith

    Step in the right direction but not by much. MLB by far has the largest minor league system and there is a real cost for them. Still in the end it would not be real taxing imo to pay $24,000 a year as a starting point. This allows most players if they choose to concentrate on baseball year round. This would benefit the team and player

    Reply
  3. Oldtimer

    A typical pro athlete “works” 10-12 hours per day during their seasons. When you factor that in, their MiLB salaries are closer to (if not below) minimum wage in USA.

    Reply
  4. BK

    Using a teams gross revenues to illustrate the financial impact of increasing pay is misleading as teams have hundreds of millions in expenses that offset those revenues. A better measure would be operating income. The Reds operating income in 2019 was $37M, by far their highest reported by Forbes (my guess is that this was due tot he new TV contract kicking in). Keep in mind, operating income excludes such items as interest expense, tax expense, depreciation and any investment income the Reds may have earned from non-baseball activities. These items are used to calculate a business’ net income. In short, the Reds net income was almost certainly well below $37M. Operating income and net income are much more relevant as they provide better insight into how much the Reds can spend on a discretionary basis.

    Using $37M (operating income), the expense would be 2% of the operating income or ten times higher on a percentage basis when compared to the gross revenue figure used in your article. Your point that ~$600K/year is a small amount for baseball is valid, but small doesn’t mean insignificant.

    From reading this site, we’ve learned that the Reds have made a number of investments in player development over the last couple of years: increased # of coaches, hired nutritionists, added technology to the minor league parks, better meals, etc. These are the types of improvements funded with what you are calling “rounding error”.

    I’m happy to see the pay increases for minor leaguers–long overdue.

    Reply

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