Professional Sports in Today's Economy

In a time when player’s contracts continue to rise to new heights (Alex Rodriguez will make $27.5 million each year until 2017 from the New York Yankees) we forget that sports are not invincible to our ailing economy. Today, NFL commissioner Rodger Goodell announced the layoff of about 150 of its 1,100 member staff in New York, NFL Films in New Jersey, and television and internet production facilities in Los Angeles. These layoffs are not the first in professional sports this year as NASCAR (starting in July), the NBA (September), and Major League Baseball Advanced Media eliminated 5% of its jobs Monday.

But at first glance, professional sports do seem to be invincible to economic troubles in the United States. The 2008 Major League Baseball regular season attendance was the second highest mark in history, drawing 78,624,324, only slightly less than 2007. When factoring in that 10 games were never played due to inclement weather, 2008 could have been another record year. Still, the National League and seven teams set attendance records. In 2007, the NFL set a regular season paid attendance record for the 5th year in a row, averaging 67,738 per game. Thus far, the 2008 season shows no signs of weakness for the NFL. Considering the average NFL ticket has jumped about $5 each year for the past four seasons to a league wide $72.20 in 2008, where are the weaknesses in professional sports causing these layoffs?

While popularity, attendance, and ticket prices are reaching record levels in professional sports, corporate sponsorships are leaving the sports world like UNC fans in third quarter of a 41-10 thrashing at the paws of the Wolfpack. On November 24, Buick and General Motors seeking to cut costs announced the end of their 9 year contract with Tiger Woods. And DHL may be forced to end its sponsorship of the Atlanta Braves following the termination of 14,900 employees. While the economy is not nearly bad enough to send the major sports packing just yet, cycling fans were disappointed to hear the Tour de Georgia, one of the marquee road races in the United States was canceled in 2009 because of lack of sponsorship. That’s right, canceled; this alone shows how much sponsorships mean to the success of professional sports. Fans alone cannot pay for the stars we love to watch, professional sport franchises will need corporate sponsorships to pay for D-Wade and Lebron in 2010.