• Sumo

By Ken Reed

Major League Baseball (MLB) owners are pushing Congress to allow them to continue paying minor league baseball players less than a McDonald’s worker or Walmart greeter.

The reality for most minor league players today is that the hot dog vendor in the stands is making more money than they are.

And MLB owners are working hard to keep it that way. They’ve paid hundreds of thousands of dollars to lobbyists who are pushing members of Congress to include language in the new omnibus bill that would exempt minor league baseball players from federal labor law, including federal minimum wage requirements. It would also exempt owners from punishment for previous violations of minimum wage, maximum hours and record-keeping requirements.

Given the huge salaries players at the Major League level enjoy, most people have no idea how poorly compensated minor league baseball players are. From an economic perspective, the lifestyles of minor league players have very little in common with Major League players.

It’s a perfect situation for economic exploitation: powerful Major League baseball owners, operating a self-regulated monopoly, who control the minor league system and determine what to pay minor league players; a large supply of young aspiring baseball players in high school and college passionately chasing their Major League dreams; and the lack of a minor league baseball players union to protect the players’ interests.

Players at the lowest levels of minor league baseball make approximately $1,100/month. Players at the highest levels of the minor leagues can make close to $2,200/month. However, it’s important to note that those wages are for the regular season only, which is about six months. Players don’t get paid for spring training or any training sessions during the rest of the calendar year.

As a result, a large percentage of minor league baseball players have annual incomes that place them below the U.S. poverty line. In fact, players at the lowest levels of the minors have hourly wages that work out to approximately $4/hour, based on the typical 60-hour workweek of minor league players.

Meanwhile, revenue for Major League Baseball owners has skyrocketed during the past decade, due largely to dramatic increases in media income.

According to Statista, a statistics website, Major League Baseball’s 30 teams generated around $9 billion in total revenue during the 2016 season, almost twice the revenue generated ten years prior, when total revenue was at $5.5 billion.

MLB franchise values are also soaring. Strong revenue growth has had a large impact on the valuation of MLB franchises. In 2017, the average franchise value was estimated at $1.54 billion, a new high.

Despite this strong financial picture, owners have refused to throw minor leaguers a few bones. Minor league player salaries have remained stagnant for a decade.

Fixing this economic injustice would hardly dent the wallets of Major League owners. Raising the wages of all minor league players to the federal minimum wage level would cost each MLB team less than $4 million. The average Major League Baseball salary is approximately $4.5 million.

Major League Baseball owners are trying to claim that minor league baseball, as we know it, would go away if they had to pony up the money to bring all minor league players up to a minimum wage salary.

Let’s look at that claim realistically. First of all, MLB owners are heavily reliant on their minor league teams to provide the talent to fill out their Major League rosters. The minor leagues aren’t going anywhere. Second, MLB owners are swimming in a large pool of media revenue.

As but one example of their media bounty, each MLB team is expected to receive $50 million in the first quarter of 2018 from MLB’s sale of BAMTech to Disney last year. BAMTech is a digital media company spun off from MLB Advanced Media.

The idea that minor league baseball in smaller communities across the country would cease to exist if Major League Baseball owners had to pay their minor leaguers a basic living wage is ridiculous.

Congress should just say “No” to exploiting young minor league baseball players.

Ken Reed, Sports Policy Director, League of Fans

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