Wednesday, January 17, 2018

Examining the broken free agent market

Spring training opens in less than a month, and almost all of the most significant free agents remain unsigned.

Jeff Passan offered on Tuesday this detailed analysis of why that is. He makes some good points about the implications of the broken market, which he traces to three legitimate factors:

  • A players union that has suddenly become ineffective on financial issues.
  • The acceptance by fans of the notion that being competitive is optional.
  • The rise of analytics in front offices.

It's the last that most fascinates me. Passan summarized the new generation of young, highly educated general managers' collective view of free agency:

The inefficiency of the operation and the expectation that they must spend money there offends their sensibilities. And they’re not wrong. Players’ best years come in their 20s. Most free agents, then, are asking teams to guarantee them large sums of money for multiple years based on the performance of years they’re statistically unlikely to repeat. It’s not impossible, sometimes not even improbable, for them to do so. It’s just a risk, and as teams weigh the risk against that of seeking the same production from low-cost players they have developed, it’s one they’re less and less willing to take.

Baseball's salary system has been built like this for a few decades: Player comes to the majors, plays three to four seasons for essentially the minimum (which, granted, is multiples of any salary I've ever had), then is further cost-controlled through three arbitration years in which the salary escalates. Now he's eligible for free agency adn the big bucks.

And now, also, he's around 30. He's free to hit the open market -- at the age in which decline should be expected.

I no longer remember who Bill James was writing about specifically all those years ago in one of his Abstracts (Jack Clark?), but he compared the player's career to a watermelon. One team, he said, ate the sweet part; another paid for the rind. The analogy, if not the specifics, stuck with me; the odd thing is that it has taken 30-some years for management to grasp that reality.

Passan theorizes that baseball's labor peace is in jeopardy. As matters stand, young players can't get paid because they have no leverage, and old players won't get paid because the odds are that they;re going to decline. Meanwhile the teams are swimming in money.

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