Thursday, July 7, 2011

What Should the NFL Labor Market Look Like?

NFL Commissioner Roger Goodell wrote an op-ed piece in the Wall Street Journal on this very question. Goodell's view is that the NFL's current collective bargaining system should remain primarily as it current is structured. The players (and their representatives) have asked that the labor market be significantly changed as is laid out by Goodell in the op-ed piece posted above.

Thus the question is about the structure of the NFL labor market. Should it be based on market forces or on agreements between the owners and a labor union of football players? The owners want a unionized labor market, and the players want a free labor market.

Goodell states that one of the successes of the current NFL labor market system is competitive balance. I disagree. Yes, the NFL relative to other sports leagues like the NBA and MLB are more competitive balanced. But not because of the current NFL labor market. The NFL had greater competitive balance before the current collective bargaining agreement's (CBA's) than the NBA and MLB, and since the CBA era, competitive balance has not changed much in the NFL.

Goodell states that the players want a labor market in which every in-coming player is a free agent (i.e. no entry draft) and upon completion of their contract, every player is again a free agent (i.e. no franchise tags limiting a player from negotiating with other potential employers).

Goodell implies that a handful of players will end up on the highest revenue generating teams, and that many teams will end up as "farm" teams of those with higher revenues. Thus to avoid this, the players will have to give up some of their labor rights and work under a collectively bargained system.

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