A Hefty Raise for Baseball’s Youngest Stars?

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The players are expected to deliver a counterproposal to the owners on Monday in the latest effort to end the MLB lockout and, when they do, it should include a hefty raise for some of the game’s youngest stars.

While baseball set revenue records nearly every year during the last decade, the league’s minimum salary has not kept pace with that economic growth. The last major increase to the baseline salary was in 2012, when it was raised to $480,000. In the decade since it’s gone up just 18% to $570,500, barely exceeding the rate of inflation according to the US Bureau of Labor Statistics. The owners’ latest CBA proposal included raising the minimum salary to $600,000 but, as Travis Sawchik of theScore noted, that would actually be a pay cut once inflation is factored in.

While the minimum salary has remained relatively stagnant, the value of franchises has skyrocketed. Using Forbes’ estimates, in 2012 the value of the median MLB franchise was $494 million. In the most recent estimates that figure has more than tripled to $1.65 billion.

During that time baseball’s minimum salary has also trailed behind its peer leagues. For the 2021 season the NFL’s league minimum was $660,000 for rookies, up from $375,000 a decade ago, and included a required escalation for players based on service time. A player in his third NFL season made a minimum of $850,000 in 2021.

The NBA, meanwhile, blows that figure out of the water: The league minimum salary for rookies during the 2021-22 season is $925,258 and that figure escalates rapidly based on service time. By an NBA player’s third season they’re guaranteed a minimum of $1,669,178.

Minimum Wages?

MLB teams, meanwhile, are allowed to keep players at or near the league minimum until they qualify for arbitration after three full seasons in the majors. So while a player who debuts in the NBA and plays three years is guaranteed around $4 million, a baseball player in a similar situation is guaranteed around $1.7 million.

Players with zero to three years of MLB service time made up almost two thirds of all players in 2019, again according to Sawchik. All told, 37 of the 61 players to wear a Brewers uniform at some point during the 2021 season fell into that category. It’s a list that includes NL Cy Young Award winner Corbin Burnes and top contributors like Willy Adames, Brandon Woodruff, Adrian Houser, Freddy Peralta, Devin Williams and others. With the exception of players who have signed long term contracts (like Peralta), they all made the league minimum or slightly more during their time in the majors.

Furthermore, modern roster practices make it harder for fringe MLB players to reach service time thresholds. The Brewers are one of many teams to use something of a revolving door in their bullpen, calling up a fresh arm from the minors, pitching them a few times and then sending them back down for another fresh arm. While those players being shuffled in and out all play a role on the MLB roster, they only accumulate MLB service time while they’re with the big-league team. As such, they may not qualify for arbitration or receive any significant raise until they’ve played in parts of five or more MLB seasons.

Incentives to Owners

A significant increase in the league minimum salary would not only help those players: It would also raise the disincentive for tanking. One of the sport’s lingering challenges is some owners’ refusal to spend above a bare bones payroll threshold. Right now an Opening Day 26-man roster making the league minimum would have a payroll of just under $15 million, but raising the league minimum to $1.5 million would raise that figure to $39 million. That’s already more than three teams’ Opening Day payrolls from 2021 (per Spotrac).

A change this significant would require a pretty significant philosophical shift for the players union. In the past the union’s negotiating strategy has at times reflected the fact that baseball’s clubhouse leaders and union representatives are largely experienced players who “paid their dues” to reach a point where they earn significantly more than their lesser-tenured peers. When push comes to shove in the current negotiations, veteran players would have to agree to fight for a minimum salary increase for the next generation and perhaps lose something that would benefit them directly.

With that said, a significant increase to the MLB minimum salary would go a long way to both get some of the sport’s increased revenues into the hands of its young stars and disincentivize tanking. It would be a good thing for the health of the sport, and it deserves serious consideration.