Footballers' wage dip just a blip
Premier League wages have fallen by 3% during the 2004/05 season, after a decade of 20% annual wage increases
Premiership wages may have fallen for the first time in the history of the
league, but by 2007 club FDs could once again find themselves battling to
control skyrocketing salaries.
Deloitte’s latest football finance survey revealed that after a decade of 20%
annual wage increases, Premier League wages fell by 3% during the 2004/05
season. The Premiership’s wage to turnover ratio also fell to below 60% for the
first time in five years.
But Alan Switzer, senior consultant in the Big Four firm’s sports business
group, warned that when the Premier League’s new television deal with Sky Sports
and Setanta for the 2007/08 season kicked in, club boards would once again be
faced with the reality of having to budget for rising wages. The new deal is
expected to boost Premiership revenues to more than £1.7bn.
‘In the past, agents and players have successfully negotiated better wages
ahead of improved TV deals,’ Switzer said.
The good news for football club FDs is that although wages are expected to
increase as a result of the upcoming TV deal, clubs should be able to retain a
greater slice of revenues than previously.
‘Clubs have become more focused on controlling costs. Contracts have become
more performance-oriented so although we expect wages to increase in 2007, we
expect clubs to hold on to a bigger portion of revenues,’ Switzer said. ‘We
don’t expect to see the same rate of wage increases that we have seen in the
past.’