There has been a lot of talk in recent weeks about Messi’s salary, which has been leaked and made public great exclusive from the newspaper The world.
The dispute over athletes’ salaries is not new. Again and again it is approached from a sporting, economic and even ethical point of view.
From a strictly economic point of view, we are faced with the challenge of determining the production function of the worker, in this case an athlete, and comparing the costs and total income attributable to it.
Compensation is a critical part of managing and retaining talent in any organization. The worker will be profitable as long as the income earned is greater than his costs. The problem to be solved is that the employee and the employer will seek to maximize their income in a clear conflict of interest. On the other hand, there is the difficulty of knowingly measuring the contribution of each athlete to his club’s return on investment the marginal utility of each new euro of investmentso the agents must negotiate with these unknowns in mind, and there will predictably be different criteria in evaluating them.
To analyze the Messi case, we have the data from income your club in the past few years. We find them in both the annual accounts and the reports from the consultancy Deloitte at the end of each season, with an interesting breakdown of the revenues of the top 20 football clubs by revenue.
Of part of the costwe have access to the player’s salary for the last three years that appeared in the above report from The world. With these figures released, we know that Messi is the highest paid athlete in the world. The negotiation of this contract took place in full commercial expansion of the club; The earnings for the 2018/19 season increased by no less than 22% to €150.4 million, a number that is similar to the salary the player received in the same year, which was €154 million. Unfortunately for Barcelona, the pandemic has hit the company hard. The revenue accounts of the top 20 clubs in terms of revenue fell by 11.8% in the 2019/20 season; The Azulgranas have lost just over 15%, meaning €125.7m, which is almost a pension of their big star.
With these two dates on the board, we can know that Messi’s salary represents a 22%, 18% and 21% of total income for each of the last three years. Knowing if that’s too much or too little requires further analysis, but it can be a starting point. For example, we would need to know the clauses of the club’s sponsorship contracts. Do they include conditions for Messi’s presence? The claim that this is the case is not unreasonable, and the news published in various outlets about the downward renewal of the Rakuten or Beko agreements seems to ignore the impact of the fateful office fax last August. Luckily for the Catalans, their deal with their technical sponsor Nike doesn’t expire in the short term and their €105m a year is among the best in the world football market.
On the other hand, Barcelona is the team with the most followers on YouTube, 10 million, and the second largest team in the world in terms of total number of followers on social networks, with 248 million – the first being Real Madrid with 252 -. Nurturing these followers and managing their proper monetization is vital to the future of the club.
in my opinion The figures from Messi’s contract, which were high, have been adequately maintained in the balance of earnings generated in the pre-crisis economic environment. The economic, sporting and emotional importance of Leo Messi’s character seemed to maintain a very important part of the culé scaffolding, in a process that has matured over more than a decade with undeniable success.
The pandemic has disrupted everything and Messi’s salary is unacceptable by any club in the world today. Difficult choice for the club’s new managers and for the player himself, to be resolved in the coming months.