Effects of Lockouts and Strikes of Professional Sports

I am fully aware that the posting frequency has decreased rather dramatically as of late. This is a trend that we all want to avoid. But I can promise you that much time has been put into the blog. We have begun experimenting with podcasting, which is a feature I am sure the followers will love. The time usually spent writing has been focused on the following research paper. With lockouts looming in both the NFL and NBA, the guru found it appropriate to inform the masses of the effects these labor disputes may have. While not fantasy related, I hope you find the article interesting and informative.


Sports fans are finally recovering from the devastation caused by the recent lockout of the National Hockey League (NHL), and already the threat of a new cancelled sports season has come to life. National Football League (NFL) owners are at odds with the players’ association, a standoff that may result in a year without football. With significant rule changes affecting the upcoming season, it seems unlikely that the sides will reach an agreement before the Collective Bargaining Agreement (CBA) expires. Negotiations are at a standstill, causing many to believe that the 2011 season may be cancelled.


Labor disputes are not uncommon in professional sports, but rarely do they result in cancelled seasons. When they do, widespread trouble is created. Lockouts and strikes should be used as a last resort during negotiations because the effects they have cause trouble for many people, few of whom have a say in league matters.

It is common to hear the terms strike and lockout used interchangeably. While they have similar effects, there is a difference between the two. A strike is a “work stoppage by a body of workers to enforce compliance with demands made on an employer” (Webster). A lockout is the “withholding of employment by an employer and the whole or partial closing of his business establishment in order to gain concessions from or resist the demands of employees” (Webster). Simply put, strikes happen when the players will not play, and lockouts occur when the owners will not let the players play.

Matters become more confusing when government regulation comes into play. A 1922 US Supreme Court decision deemed Major League Baseball not “interstate commerce,” giving them exemption from federal antitrust laws (Jacobson). In 1957, the Supreme Court decided that the NFL should not be exempt from these same laws (Jacobson). I am unsure of the reasoning behind these verdicts since no apparent differences existed between the two leagues at the times of their respective decisions. Since their ruling, the MLB has added franchises in Canada. Canadian cities have teams in the NHL and National Basketball Association (NBA) as well. This international expansion leads to complications with legal issues such as jurisdiction. Additionally, international governing bodies exist to regulate individual sports. For example, the International Ice Hockey Federation (IIHF) frequently intervenes when players under contract leave to play in other leagues.

Much criticism of labor disputes has to do with their far-reaching economic effects. It does not take much effort to see some sign of professional sports in society. From apparel to advertising, pro sports dominate today’s culture.

Street & Smith’s Sports Business Journal estimates that $10.5 billion worth of licensed sports merchandise was sold in the United States in 2005 (Jacobson). This number is not surprising when one spends time in a city with a sports team. From clothing to bumper stickers, fans love to show their support of their favorite teams. This is obviously a major component of the economy for any city with a professional team. In fact, David Littmann, the chief economist for Comerica, claims that a typical NHL season puts $85 million into the Detroit economy (Weber). For a city with such publicized struggles, this spending is a necessity. When a season is cancelled, much money goes to waste. American Airlines has a hefty naming rights deal with the arena in Dallas. They are paying $195 million dollars for the building to be named the American Airlines Center (Jacobson). Imagine their disgust when the Dallas Stars were not playing hockey. Rinks that cost over $500 million to build, much of which paid for with taxes, were sitting vacant (Weber). Locals were quick to voice their concerns with the missed seasons. Michael Shaim, a Boston bartender, expressed his thoughts during the lockout, “People don’t want to read about contract disputes in the sports section. It was the one place in the paper where those things could be avoided” (Thomas). Like many small business owners, he saw reductions in his revenue correlate with an empty arena.
 
These effects are not limited to the geographic area of teams in the locked out league. When news broke of the NHL lockout in the summer of 2004, 205 NHL players had signed contracts with European teams by October 16th of that year (“Skating on Thin Ice”). While this may seem like a good backup plan to Americans, the players in those European leagues may not agree. The NHL players put 205 Europeans out of work (“Skating on Thin Ice”).


This seems more selfish when one looks at the money North American athletes make. From 1975 to 1985, MLB player salaries increased from an average of $44,000 to $360,000 (Thomas). According to Thomas, “1954 MLB MVP Willie Mays earned $25,000, about the equivalent of what a utility infielder makes in today’s (1985) dollars.” Fast forward to the present, where NFL rookie Matthew Stafford signed a six-year, $72 million contract with $41.7 million guaranteed (Myers). This astronomical sum was the most guaranteed money in NFL history (Myers), given to a player who had yet to partake in a professional practice. As ridiculous as that may sound, Stafford only made $3.1 million in 2009 (“USA Today Salaries Database”). That same year, Alex Rodriguez made $33 million in salary, excluding deferred payments and incentive clauses (“USA Today Salaries Database”). In fact, the New York Yankees, for whom Rodriguez plays, paid their players $209,081,577 in 2009 (“USA Today Salaries Database”). Baseball and football are not the only sports in which players make vast amounts of money. In 2008-09, Kevin Garnett’s salary was $24,751,934 (“USA Today Salaries Database”). In 2004-05, the NBA’s Atlanta Hawks paid their entire team less than that (Jacobson). Even with the NHL’s salary cap, Dany Heatley received $10 million from the Ottawa Senators in 2008-09 (“USA Today Salaries Database”), the highest salary in the league. Heatley was followed by Sidney Crosby, who made $9 million that year (“USA Today Salaries Database”). The demands of players seem absurd when compared to their predecessors. The NFL Players Union came about in 1956 when players joined forces to request minimum salaries and team-paid uniforms and equipment (Jacobson), a far cry from the selfish ultimatums of today’s athletes.

Owners have enjoyed great increases in revenue over the past few decades as well. From 1975 to 1985, the same span in which the average MLB player salary increased nine fold, annual revenue per club quadrupled to $624 million (Thomas). During that stretch, attendance increased roughly 50% (Thomas). In an attempt to diminish the advantage some teams possess by playing in a larger market, the NFL implemented revenue sharing. By the terms of the CBA that governed the NFL in the early 21st Century, the home team gets 60% of the ticket sales, while the visitors receive 40% of the take. The host gets all the income from luxury boxes, one reason why clubs are building stadiums with more and more of these suites (Jacobson).

It is true that during disputes, certain circumstances may arise that improve the sport. For example, during the NHL’s recent lockout, Commissioner Gary Bettman aimed to increase scoring in hopes of attracting fans (“The NHL Has Improved. Other Rinks, Please Take Note.” A14). The rule changes include a crackdown on obstruction, enlarging the offensive zone, and shrinking goalie pads (“The NHL Has Improved. Other Rinks, Please Take Note.” A14). It is the opinion of most fans that the post-lockout NHL is much more exciting than the “clutching and grabbing contests” of the late 1990’s. While negotiating the 2005 CBA, the NBA formed rules (legislation) against players entering the league straight out of high school. Although widely considered ineffective, the rule was intended to increase the maturity level of NBA players (Jacobson). While these statutes may have enhanced their respective sports, their benefits are dwarfed by the negatives that arise from labor struggles.

Neither side wants seasons to be cancelled, whether partially or in entirety, but sometimes the negotiators hold strong. Several disputes have caused little or no games to be missed, such as the 1990 MLB lockout, which evoked the cancellation of spring training (Jacobson). The 1992 NHL strike lasted just 10 days. Every missed game was able to be rescheduled (Jacobson). Other times, it takes months for the two parties to reach an agreement. Lockouts in the NBA (1998-99) and the NHL (1994-95) both caused roughly one third of those seasons to be cancelled (Jacobson). The 1994 MLB strike led to the cancellation of the World Series (Jacobson), the first time there was no postseason baseball since 1904 (Stewart).
 

“Baseball Fans Protest Against Major League Strike.”

Owners, as well as players, should think long and hard before threatening to lockout or strike. The effects of an abrogated season negatively affect people around the globe. Some good may come out of labor disputes, but it is largely overshadowed by the trouble that it accompanies. Lockouts and strikes should be used as a last resort during negotiations, for the benefit of not only the game, but of professional sports’ most esteemed component, the fans.

Works Cited

"Baseball Fans Protest Against Major League Strike." Opposing Viewpoints Resource

Center. Web. 2 Mar. 2010.

Jacobson, Robert. "Professional Team Sports." Sports In America: Recreation, Business,
Education, Controversy. Detroit: Thomson Gale, 2006. Web.

Myers, Gary. "Matthew Stafford's Contract with Lions at Root of Rookie Wage

Dilemna." New York Daily News 25 Apr. 2009: n. pag. Web. 25 Apr. 2010.

"Skating on Thin Ice." Globe & Mail (Toronto, Canada) 16 Oct. 2004: n. pag. Web. 2
Mar. 2010.

Stewart, Mark. Baseball: A History of the National Pastime. New York: Franklin Watts,
1998. Print.

"The NHL Has Improved. Other Rinks, Please Take Note." Globe & Mail (Toronto,
Canada) 17 Oct. 2005: A14. Web. 3 Mar. 2010.

Thomas, Evan. "A Win For the Fans; the Owners Balk, the Players Walk, then Ueberroth
Gets the Save." Time 19 Aug. 1985: n. pag. Web. 2 Mar. 2010.

"USA Today Salaries Database." USAtoday.com. USA Today. Web. 11 Mar. 2010

Weber, Bruce. "Lockout in NHL Pushes Businesses to the Brink." New York Times 9
Dec. 2004: n. pag. Web. 1 Mar. 2010.

Webster, Merriam. Webster's Ninth Collegiate Dictionary. Springfield, Massachusetts: Merriam-Webster Inc., 1983. Print.