Fitt: MLB Reduces Job Opportunities At Its Own PerilColumns
At least the waiting game is over. Two months after the college baseball season was abruptly cut short, at least we finally have an answer to the draft question.
Unfortunately, it’s the wrong answer.
Friday’s news about the 2020 MLB draft made official what many players, scouts, coaches and agents feared was likely to happen: the commissioner’s office has slashed the draft from 40 rounds down to just five. And even worse, any player not drafted in those five rounds can’t receive more than $20,000 as a nondrafted free agent.
Any player fortunate enough to get drafted this year might be wise to hold off on paying down his student loan balance, because no player can receive more than $100,000 of his signing bonus this year. The remainder must be deferred and paid out over the next two years. As MLB Pipeline’s Jim Callis pointed out, clubs will defer at least $219.9 million of their aggregate $235.9 million in bonus pool money, and half of that $219.9 million (about $110 million) will be deferred until 2022.
So even if you’re a first-round pick, you might struggle to make ends meet over the next year, because there might not be any minor league season in 2020, and you won’t be drawing any salary until official games begin — players don’t get paid at all to attend fall instructional leagues or spring training. Once the minor league season begins (and it seems more and more likely that won’t happen until 2021), Rookie-level and short-season players were due to earn a whopping $400 per week — which equates to about $4,800 for the entire three-month season. Class A players were due to make $500 per week. Last year it was even worse; Jake Mangum wrapped up his illustrious college career at Mississippi State and then earned $290 per week in the New York-Penn League.
If you’re not one of the fortunate 160 players who gets drafted on June 10, good luck trying to get through the rest of the summer, fall, winter and spring on your $20,000 signing bonus, a healthy chunk of which will go right to the government in the form of taxes. That bonus will be long gone by the time you start drawing your big $500 weekly check next April — if you can make a full-season club out of spring training.
This has been the harsh reality for players in the low minor leagues since the dawn of professional baseball. But at least in years past, many players could supplement their meager minor league salaries with nest eggs from respectable signing bonuses. Sure, there were also college seniors who signed for $1,000 and had to grind their way through the minors on ramen noodles and peanut butter & jelly sandwiches. But there were also plenty of players who were drafted outside the top five rounds and still got sizable enough signing bonuses to keep them afloat for a while.
As Callis reported in April, 395 players received six-figure bonuses after the fifth round last year. And 295 of them came after the 10th round, when players could receive up to $125K without counting against an organization’s draft bonus pool. Clubs could also go above that $125K mark by saving bonus pool money with cheap seniors in the top 10 rounds.
You might think the MLB draft was far too long at 40 rounds, and sure, there was room to streamline the process. There are a lot of players drafted in those last 20 rounds who have no intention of signing pro contracts, or who sign for peanuts as Rookie ball roster fillers and don’t last more than a year in the minors.
But if there are roughly 160 picks in the top five rounds of an average draft, and roughly 400 players deemed worthy of six-figure bonuses by MLB clubs after the top five rounds, we’re still talking about 18 or 19 rounds worth of legitimate six-figure prospects, plus plenty of other five-figure guys who still have shots to develop into major leaguers. Not all of those guys will make the big leagues, of course, but a decent amount of them will make real contributions. The Athletic’s Ken Rosenthal wrote this weekend that of the 1,410 players who appeared in at least one major league game in 2019, 1,046 entered the league through the draft. And 483 of those — 46 percent — were taken in the sixth round or later.
So it’s a big deal that Major League Baseball is forcing about 400 players who would normally fetch bonuses over $100K (and remember that the value for sixth-round picks ranges from $237K to $300K) to choose between signing for $20K or else going back to school. All of those players — even seniors — have been granted an extra year of eligibility by the NCAA, and many of them would probably be wise to take advantage of it. You might as well try to get your degree or work toward a master’s, because who knows when you’ll be able to draw a paycheck for playing minor league baseball? And whenever those anemic checks start rolling in, you won’t have a respectable signing bonus to buttress them.
Of course, we don’t know yet whether there will be roster spots available for players who find themselves in this bind. Let’s hope the NCAA relaxes baseball’s 35-man roster cap and its maximum of 27 men on athletic aid, as the American Baseball Coaches Association recommends. But even if those restrictions are loosened, there’s only so much playing time to go around. If the NCAA doesn’t reinstate the one-time transfer exemption (and it should, but the wind now appears to be blowing in the opposite direction), then some players are going to have to transfer to junior colleges or NAIA schools. A lot of other players will simply be forced to hang up their cleats before they planned.
This is a time of unprecedented crisis, and it’s understandable that MLB is trying to trim expenses. And while the amount of money MLB clubs will save by cutting the draft to five rounds (in the neighborhood of $1 million per club) seems trivial when the average team is worth $1.85 billion, the move would make more sense if those savings were funneled directly into paying full-time employees.
But in our conversations with scouts, many of them are in the surreal position of hoping they just get furloughed — and not laid off. Most organizations have committed to paying scouts and other employees through the end of May, but then all bets are off.
No, MLB isn’t cutting the draft in order to redirect funds to pay its full-time employees. If the billionaires and multi-billionaires who comprise baseball’s ownership class really want to take care of their employees, they have the unfathomable wealth to do it out of their own pockets — they don’t need to borrow from 18-to-21-year-old draft prospects to meet payroll. Clubs have invested a lot of time and energy in building talented, hard-working scouting and player development departments, and it would be a shame for baseball to lose those quality minds to other professions as a result of the pandemic.
And it would be a calamity if baseball’s cost-cutting measures also caused the player pipeline to dry up. The owners have the means to safeguard baseball’s future, but they seem more concerned with maximizing short-term profits and mitigating short-term losses. And that’s a very discouraging signal to send to athletes and fans alike.
For years, baseball has openly signaled its desire to trim the fat in the minor leagues by cutting the draft to about 20 rounds and reducing the number of affiliates for each club. Last year, MLB proposed eliminating 42 of the 160 minor league affiliates when its current agreement with Minor League Baseball expires at the end of the 2020 season. The COVID-19 crisis just gave MLB the cover it needed to ram through some of the changes it wanted anyway. A shortened draft goes hand in hand with a cut in the number of affiliates.
But it seems short-sighted to drastically reduce the number of professional opportunities available to baseball players. If owners care about growing the sport, it seems counter-intuitive to eliminate pro baseball from dozens of communities across the country, many of which aren’t located anywhere near major league markets.
Instead of drafting 1,200 players this year, MLB clubs will draft 160. And while the current agreement requires the 2021 draft to be at least 20 rounds, don’t be surprised if MLB pushes for fewer than 20 in the years to come.
In Rosenthal’s column, agent Scott Boras summed up the message MLB is sending to players: “We probably should have bought a billboard that said, ‘Go play other sports after Little League. Goodbye.’”
And that’s why juniors who don’t get selected in next month’s five-round draft might be smart to go back to school rather than sign for $20K or less. The billionaires who run Major League Baseball want there to be fewer jobs for baseball players. So even if you’re facing a struggle to find playing time back at school, at least you can get closer to your degree. You’d better start planning for life after baseball, because there’s a good chance it’s coming sooner than you expected.