2010 MLB Opening Day Payroll Analysis

In this session of Purple Row Academy, I'll examine the Opening Day payrolls of the 30 MLB teams and perform basic analysis on some recent trend data, particularly with the Rockies. For those of you who are wondering, I have not forgotten about finishing up my series on revenue sharing, but I want to delay that until I have more time to do a proper job on analyzing it. I already have some data sources for ODPs so I thought I would share some analysis with you, my stunning and intelligent readers.

A team's ODP relative to last year's figure often is evidence of how a club views its chances in the upcoming year. If a team made a big off-season acquisition that increased its ODP, for example, it would indicate that the club sees a window of opportunity to make a run at the playoffs. If a team decreased its payroll through a salary dump trade or failing to re-sign its veteran free agents, it is an indication that the team expects to be rebuilding that year. 

ODP figures can also be a sign of backloaded multi-year contracts (such as Todd Helton's) becoming more costly. In other words, a large player payroll isn’t always a good thing, as it can signal that a club has little to no payroll flexibility during that year and even for future seasons.

2010 Payroll Expenditure by Team

Overall, according to data collected by Maury Brown of the Biz of Baseball, in 2010 teams spent 2.35% more on their total Opening Day payroll than they did in 2009. In 2009, Opening Day payroll for all MLB teams totaled $2,655,395,194, a number that increased this year to $2,717,766,875--about a $62.4 million difference. In all, 16 out of 30 teams increased their payroll from their 2009 level. 

Ultimately, though, the total payroll expenditure number only tells us so much, partially due to the fact that it includes a different amount of players each year (all 15 day DL players are counted on a team's ODP). Let's break this down a little more--by identifying those teams that had large changes in payroll from 2009 to 2010.

The data used by Brown to calculate this is based off the USA Today Salary Database, which as I've noted before is different than the data I used to project and calculate the Rockies' 2010 ODP. The USA Today Database takes its data from the figures released by the MLBPA. When the MLBPA figures salaries, it prorates the signing bonus and any guaranteed buyouts and ignores money paid or received in trades or for players who have been released.

As a result, this data may not reflect a club's actual payroll expenditure, but it is still good for capturing a snap shot of the direction they are going in. For the sake of consistency I'll use the USA Today figure for the Rockies' payroll of $84.227 million rather than my calculated value of $83.477 million.

Below, courtesy of Brown, is the Opening Day player payroll for each of the 30 clubs for 2010, the percentage of increase/decrease from 2009, the 2009 Opening Day payroll figure for each club, and the ODP rank of each team in 2009. Double-digit % changes are in bold.

2010 vs. 2009 MLB Opening Day Payrolls

Rank

Team

2010

Pct + or -

2009

Rank (09)

1

N.Y. Yankees

$206,333,389

2.42%

$201,449,189

1

2

Boston

$162,447,333

33.43%

$121,745,999

4

3

Chicago Cubs

$146,609,000

8.75%

$134,809,000

3

4

Philadelphia

$141,928,379

25.60%

$113,004,046

7

5

New York Mets

$134,422,942

-10.01%

$149,373,987

2

6

Detroit

$122,864,928

6.76%

$115,085,145

5

7

Chicago White Sox

$105,530,000

9.85%

$96,068,500

12

8

Los Angeles Angels

$104,963,866

-7.69%

$113,709,000

6

9

San Francisco

$98,641,333

19.40%

$82,616,450

13

10

Minnesota

$97,559,166

49.40%

$65,299,266

24

11

Los Angeles Dodgers

$95,358,016

-5.04%

$100,414,592

9

12

St. Louis

$93,540,751

20.53%

$77,605,109

17

13

Houston

$92,355,500

-10.33%

$102,996,414

8

14

Seattle

$86,510,000

-12.53%

$98,904,166

10

15

Atlanta

$84,423,666

-12.72%

$96,726,166

11

16

Colorado

$84,227,000

12.00%

$75,201,000

18

17

Baltimore

$81,612,500

21.63%

$67,101,666

23

18

Milwaukee

$81,108,278

1.15%

$80,182,502

16

19

Tampa Bay

$71,923,471

13.60%

$63,313,034

25

20

Cincinnati

$71,761,542

-2.44%

$73,558,500

19

21

Kansas City

$71,405,210

1.26%

$70,519,333

21

22

Toronto

$62,234,000

-22.73%

$80,538,300

15

23

Washington

$61,400,000

1.78%

$60,328,000

27

24

Cleveland

$61,203,966

-24.98%

$81,579,166

14

25

Arizona

$60,718,166

-17.41%

$73,516,666

20

26

Florida

$57,034,719

54.84%

$36,834,000

30

27

Texas

$55,250,544

-18.96%

$68,178,798

22

28

Oakland

$51,654,900

-17.10%

$62,310,000

26

29

San Diego

$37,799,300

-13.57%

$43,734,200

29

30

Pittsburgh

$34,943,000

-28.24%

$48,693,000

28



Totals

$2,717,766,875

2.35%

$2,655,395,194

 

A brief discussion of this chart as well as more data analysis follows after the jump.
Large % Changes in ODP from 2009 to 2010

Four teams really stood out as having a large increase (more than 25%) in ODP from 2009 to 2010: Florida, Minnesota, Boston, and Philadelphia. Boston and Philadelphia's increases are largely due to the fact that both signed star pitchers to big contracts (John Lackey and Roy Halladay). 

Minnesota's payroll increase is from a combination of Joe Mauer's mega-contract extension and the opening of its new ballpark, Target Field. Interestingly, with this $32 million increase over 2009 levels to $97 million, the perennial small market Twins have become the team with the tenth largest payroll in baseball.

The Fish, responding to the scolding they received from MLB for not spending enough of their revenue sharing money, signed young stud pitcher Josh Johnson to a fat extension and gave out rich arbitration awards to players like Dan Uggla. It was the second consecutive year in which the Marlins had drastically increased payroll (they had increased it by 68.68% from 2008 to 2009), but Florida was still only 26th in ODP at about $57 million.

Meanwhile, three teams reduced their payroll significantly (by more than 20%): Toronto, Cleveland, and Pittsburgh. The reason for this slashing of payroll for these teams is largely tied to the fact that several costly veterans on those teams (and on others that cut payroll) were traded (in the case of Halladay, Cliff Lee, and Freddy Sanchez) or were claimed off waivers (like Alex Rios). These moves made a lot of fiscal and baseball sense, as none of them are expected to seriously contend this year.

2010 NL West ODP Analysis

Within the NL West, the Giants (9th overall) and the Rockies were the only teams that increased their ODP from 2009 with increases of 19.4% and 12% respectively. The Giants signed several veteran free agents in hopes of shoring up their shoddy offense as well as an extension for Tim Lincecum. Meanwhile, the Rockies concentrated primarily on keeping together the young talented team that had carried them to the 2009 NL Wild Card, signing players like Huston Street and Chris Iannetta to multi-year deals. With their payroll increase, the Rockies became the team with the 16th highest ODP in MLB.

On the flip side, the Dodgers' (11th) well documented shaky ownership situation led to a 5% payroll reduction while the Padres (29th) continued to strip down their payroll as new ownership guides the team in a new direction.

Interestingly, while Arizona (25th) seems to be in win now mode with their trade for Edwin Jackson, they reduced their ODP by 17.41%. This doesn't jive with the fact that Cot's Contracts has the Snakes' 2010 ODP at $75 million, a slight increase from 2009. The difference seems to stem from the fact that USA Today doesn't appear to count Arizona's nearly $15 million in dead money (most of it owed to Eric Byrnes) while Cot's does. It's because of examples like this that I'm loath to draw too many conclusions from this ODP data.

Rockies' Historical ODP Figures

Here are all of the Rockies' ODPs in their history in the context of the time in which they were paid (un-adjusted for inflation):

Year ODP
1993 $8,829,000
1994 $22,979,000
1995 $31,146,135
1996 $34,918,490
1997 $42,870,501
1998 $47,433,333
1999 $54,392,504
2000 $61,314,190
2001 $71,541,334
2002 $56,851,043
2003 $67,179,667
2004 $65,445,167
2005 $48,155,000
2006 $41,233,000
2">2007 $54,424,000
2008 $68,655,500
2009 $75,201,000
2010 $84,227,000
 

And here are the same payroll figures adjusted for inflation relative to their value in 2009 dollars:

Year ODP
1993 $12,944,581
1994 $32,836,756
1995 $43,421,959
1996 $47,263,239
1997 $57,056,566
1998 $62,135,232
1999 $69,378,031
2000 $75,635,098
2001 $86,861,176
2002 $67,407,334
2003 $78,168,608
2004 $73,717,702
2005 $52,458,402
2006 $43,822,257
2007 $56,266,144
2008 $68,380,878
2009 $75,201,000
2010 $84,227,000

And finally, here is a graphical representation of those inflation-adjusted numbers:

Rockies_historical_odp_medium 

As you can see above, when adjusted for inflation the Rockies' 2010 payroll trails only the 2001 club that signed pitchers Mike Hampton and Denny Neagle to disastrous mega-deals.

2010 MLB Payroll Expenditure by Player

Above, I noted that this year overall ODP expenditure was up 2.35%, or about $62.4 million, from 2009. According to  Brown, MLB's Opening Day average salary per player rose to a little over $3.34 million (0.68% up from 2009's $3.32 million) for the 828 players on MLB Opening Day rosters.

The reason that this increase is lower than overall increase in payroll expenditure is because this year ten more players are beginning the year on the disabled list than last year, so the extra money being allocated to payroll is being split up a few more ways than last year. It should be noted that by the end of the year, the average player payroll will have gone down slightly as teams release expensive veterans and call up young players as they fall out of contention. According to these numbers, the Rockies are paying the 29 players on their OD roster an average of about $2.9 million, slightly below the MLB mean.

Putting this $3.34 million average salary figure (and the $400k MLB minimum) in historical context: in the early years of baseball, when players were treated more as owned commodities than people with rights, the average salary was of course quite low. From the forties to the sixties the average was around $6,000 per player, but after the implementation of arbitration (and subsequently free agency), both average and minimum salaries of MLB players have soared.

Baseball Almanac has developed a great chart that shows quite starkly the huge increases in player salary since 1970. At the time of the Seitz Decision in 1975, which effectively legalized free agency, the average MLB salary was still just $44,676 with a minimum of $16,000. Within five years those numbers were $143,756 and $30,000, and by 1985 it was $371,571 and $60,000. Heck, during MLB's boom period between 1995 and 2000, the numbers went from $1,071,029 and $109,000 to $1,998,034 and $200,000. Where it will end nobody knows, but any way you slice it player salaries have risen a great deal in a generation.

There's a lot more that I could (and probably will) do with this data, but at the moment I simply don't have the time to go any further in depth about it.

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