Do pro athletes deserve the money they make?
Talent aside: I understand how freaking hard it is to make it to the top of a sport.
And supply and demand aside: I understand that people pay tons of money to watch them and thus they’re compensated accordingly.
I can’t help but feel like athletes are egregiously overpaid. I used to be on board, agreeing that “they sacrifice their lives, travel year round and never see their families, get traded at a moment’s notice, etc.” But now I realize that all of those arguments apply tenfold to people in other careers: investment bankers work at least twice as much for something like 20% of what a benchwarmer in the NBA makes, and someone working in a blue collar job working equal hours probably scrapes 5% or less. These people sacrifice far, far more.
Now if we claim that these athletes have put in incredible hours leading up to this point (let’s say 10,000 hours on their sport), then the top students landing in IB have to have done the same: they have dedicated their entire academic careers to high performance and success.
I can’t help but feel bitter. A lot of times, it is not hard work or a test of character that separates the $1m NBA player from his Division I turned finance bro (maxing $200k per year) counterpart, but just god-given talent and pure luck.
Note that I’m explicitly stating that I’m bitter; I am admittedly salty and envious. Roast me in the comments all you want, but while basic economic principles render my argument useless, I think athletes don’t deserve the absurd salaries they’re paid.
It's all a function of how much money you make. If you're a top .1% in a hedge fund, you make more money than any pro athlete. If you're a .1% in tech, you're likely worth hundreds of millions of dollars.
Working hours really don't matter. There are people out there working 80-100 hours working multiple jobs that can barely support themselves. Meanwhile, just a few years ago there were Google engineers making 500k a year resting and vesting(which is a lot less now, still happens just not that common).
If you want to make superstar athlete money, be in the .1% of something. Finance is great for this, with .1% in any major area of finance yielding incredible returns. Acting like you deserve massive pay packages when you don't make the firm you work for that much money is absurd. A professional athlete is paid millions because they pull in millions. A top hedge fund PM is paid millions because they pull in millions. A PE partner is paid millions because they pull in millions. Pull in millions and you'll be compensated.
Also, worth saying, you're comparing a very average case(IB intern) to an extreme edge case(professional sports), and at that an even more extreme(highest paid athlete). There are more members of congress than there are members of the NBA.
There have only been two responses Ive seen on WSO in the past three months that made me stop and think, "Wow, that was a really unique, thoughtful, and well articulated response". It was this one, as well as your comments on AI.
In a world where everyone spouts the same regurgitated bullshit, you definitely stand out
the revenue distinction is key here
working loads of hours does not mean you're generating revenue
but once you generate revenue you immediately get paid commensurate with that, because if you didn't you'd go elsewhere to generate revenue and get paid fairly
as a counterfactual, do top PMs at multistrat funds or top PWM guys deserve the money they make (hedgies making 9 figures some years, PWM guys making 8 figures)? you can argue yes or no, but here's the distinction, if they don't get paid that they hang up their own shingle where they do get paid based off the revenue they bring in
you deserve what you generate, and until one gets into a revenue generating role, this might not make sense to OP
You’re also not considering that they cant earn that same pay their whole career. Injuries and aging means they only have a 3-15 year career as an athlete and they’re taxed at 50%+ along with lifestyle creep so a lot of them actually end up broke which is why the NBA even has a union to help players transition to regular jobs. Shallow argument generally because it’s just supply and demand at the end of the day, good luck trying to convince people to stop watching sports.
Average career in the NFL is 3 years, and if you don't have name recognition, you have few transferrable skills. I don't think you even get NFL pension until 5 seasons, which is a good win at a few hundred k per year.
I have a good buddy who played 11 seasons and is a representative of the players' union. He's still hustling and selling random products back in his hometown where he's a hero, played for the state school, Georgia, led SEC in sacks, long NFL career, etc. He lives reasonably well, but all of our same aged friends in that group did finance and are largely better off. Fortunately, he's healthy and working hard. I also think he may have had a gambling addiction back in his playing days, which is why he is now hustling to get things done...pro sports is a weird life.
As strange as it may initially sound, you don't get paid mainly on how hard you work, how much you sacrifice, the #hours you spent developing, etc. Those things may factor in some, but the main driver is: the value you bring. It's something I didn't understand until I got older and further along in my career, when I started managing people.
Let me illustrate. Who gets rewarded on a test/exam, the person who studies the hardest or the person who answers more questions correctly? There's certainly correlation between the two, but teachers don't ask students how many hours they studied and assign grades based on that. Ultimately, what matters is your performance (i.e. how high you scored on the test) and nothing else.
You'll begin to see this more in life. When you are paying people, you care mostly about results. When your computer crashes, you want it fixed fast and right. Other factors remain secondary.
One last point: it can be confusing as many successful people cite the things you mention (e.g. hard work and sacrifice) as reasons for their success. However, it's because often those help bring along better results. If they aren't, there's not much patience for them.
As already alluded to by others, when it comes to athletes they get paid based on the revenue they bring in. The people up top don't care as what it takes to get done, as long as it gets done.
The main reason why there is such a pay spread beteen pro athleets and high performing industries like bankers is because the talent pool for bankers is about 1,000x as large as there is for something like the NBA. There might be 120 people in any given year that can really play in the NBA. Of those only about 50 make it. In finance, there are tens of thousands to hundreds of thousands of people who can do the work in any given year globally. The work isn't that hard.
In my (overly dated) experience there are a ton of guys out there who can't even play on their high school teams due to grades and lack of family support. We had two McD's All Americans in BB at my high school where I played FB/BB/track, we had 3 guys make the NFL...farm kid who went to an inner city high school. Totally a different story, but some of the best athletes I've ever seen never made it to college for grades or got kicked out of HS.
You are totally correct though that the talent pools are much smaller and more isolated, and you have to be in a location known for talent so all of the college recruiters come by to talk to the coaches, watch practice, etc. There are some HS programs where top coaches just roll by all of the time because they're looking for who's next? If you live in Laramie, Wy that just doesn't happen.
EDIT: I will say that I grew up before all of the online stuff like Rivals, Scout, etc. No one had a recruiting profile. Parade All American was the top of the bucket for FB...it used to come with the Sunday newspaper. The only kids who got recruited were at schools known to produce talent.
I am not saying there aren't thousands of kids with talents in sports. What I am saying is that at the very top the talent spread is actually much wider than people realize. Take a look at QBs in the NFL for an example of this. We are talking about the top 65ish players in the world for this specific skill set. Of those the talent and skill difference between the top starter and a bottom of the bucket starter talent in the NFL is massive. This isn't even talking about NFL vs non NFL talent.
I think finance bros are far more overpaid than athletes. You perform a job that has essentially zero social or functional utility. You take no risk, and yet get paid absurd sums to wager other people's money. Your job takes exceptionally little intelligence, creativity, or skill - it's simply a question of logging huge hours. The amount of money than finance sucks out of the system and funnels to employees creates a net drain on talented people going to more useful fields.
At least a professional athlete has a skillset in excess of a random person on the street. At least they risk something. You get paid to sit on your ass for 14 hours a day and move pictures a pixel or two one direction or another on a screen.
i agree with this at the junior level. At the senior level VP plus you need brains and creativity to rise above, not to mention the ability to sell. Which is why salesmen get paid more than most other careers
I mean, OP is clearly discussing the junior level (since he says comp maxes at 200k, which sounds like analyst or early associate to me).
And all the senior bankers start as juniors. So it applies to everyone. They were all horribly overpaid. And even the senior bankers don't do anything of real value, nor do they take any risk.
teachers deserve to be in this conversation way more than bankers. we as a society should place greater importance on teachers than we do now
God bless the good teachers. I have several I am immensely grateful to. Unfortunately many teachers are retarded
Teaching takes passion, not necessairly skill. I know this because I had a teacher in high school who taught history my freshman year, english my sophmore year, biology my jr year, and then back to history my senior year. Every class that he taught had higher average grades than the other teachers at that same grade level education, this was because he was passionate and could drive engagement from the kids. It didn't matter that he didn't have a degree in biology. Almost anyone can remember enough of the material to teach it, the real skill is in driving engagement.
teaching takes passion, as well as giving a shit about their students' wellbeing and upbringing. if you don't pay teachers enough to give a shit, you can't expect them to give a shit.
Teachers in many states are way overpaid for the limited function they provide.
agree that the job itself isn't a very difficult job, but the function they provide extends way beyond teaching. it extends to being a part of your child's upbringing, guiding them, looking out for them, etc.
Anyone the can get tens of millions of eyes on screens “deserves” or “earns” whatever money they make. It just makes sense.
To play devil's advocate lol: Do OnlyFans creators deserve to make that much money, when they might spend 30min of effort putting together a sloppy video that preys on insecure and mentally debilitated men?
Yes, mostly because it drives engagement.
Breaking: Professional Excel Monkey & PowerPoint Slide Maker Argues Others Don’t Deserve High Income
DESERVE???
Believe me, nobody on this forum wants to start getting into the morals of what people "deserve" because your life as a person making 200k or 500k or 1m or whatever people are making here . . it gives you a life that's (relatively speaking) a billionaire's life relative to much of the world.
Look at it this way instead: athletes are paid the amount that maximizes total revenue to the sport. Maximizing revenue to the sport ensures:
Look at things through that lens - what's the best system for everyone - rather than what people "deserve."
To this point my grandfather who played college football at the start of WW2 came back and had a NFL offer. He said no because he'd make more money in business. That was common at the time when the NFL paid nothing.
That's amazing to think about. I remember at the beginning of the Bad Boys documentary, Bill Laimbeer said NBA salaries were so low in his early days (at least for low-skill guys like him) that his dad made more money as an upper manager at a glass company.
Give them bread and circuses. They are playing their part
I mean can't your argument be applied to literally everyone in the entertainment industry? Athletes are paid so much because they provide entertainment and people are willing to pay for that entertainment. Okay, well what other professions and industries provide entertainment? Movie/film industry, Music, Youtubers, Fashion, Gaming, etc... Your argument can pretty much be boiled down to entertainment does not provide any real value. If we were neanderthals that only knew how to eat, sleep, and poop, then I'd argue that you are correct, but we are humans.
Supply and demand
We live in the richest country in the world, that of which provides infinite incentive (fame, money, women, lifestyle, etc.) to become an NFL QB, but yet there are maybe only 15 guys who are genuinely good at it. And you ask why they get paid so much? It’s the hardest job in the entire world.
not the hardest job in the world... c'mon guy
It is definately more difficult than commeting on an online message board.
They deserve it way more than a retard like chase coleman who got a fund bc he grew up with Julian Robertson's kid and then rode tech beta during the biggest stock market goldrush in history.
I would have to imagine that its certainty the case that talent can fall through the cracks and not land at the outer edge of an NBA roster and thus be unable to prove themselves
Some players have pointed to this fact that the bottom of the nba is not particularly better than good players that haven't made the NBA that are now playing overseas
How much you get paid in industry is also a large function of luck as well, on paper there is a large pool of people who would likely do as good of a job as anyone else
A pro athlete is in the 0.1% of performance. And the hours they put in are only one part of why.
I don't agree with the premise that a banker or a student recruiting put in that level of work and commitment, but hypothetically say I do. Nobody paying a monthly subscription to watch a bunch of dweebs building WGLs and models.
That said, the 0.1% of bankers or finance professionals have done pretty damn well. Most of us are just not in that bracket.
Pro athletes do deserve the money they make because most fans of pro sports are suckers. Don't get me wrong, sports are great at the youth, high school, and even collegiate level (if you are able to make it to that level), but the American culture around professional sports is horrible and the ones that fall for it are suckers.
What most American consumers fail to realize (blissfully unaware) or choose to ignore is that pro sports is just like anything else in capitalism. Rooting for your favorite pro sports team is analogous to rooting for your favorite company. The difference is that with your favorite company (e.g. Apple, Tesla, etc.), at least you can own shares in it - so your interests are aligned with the company. What alignment of interests do you have with your city's major pro sports franchise? Nothing except for some edge cases such as sports gambling (which is only a very ephemeral alignment) or very specific circumstances that don't apply to over 99.999999% of people (e.g. you own a bar/restaurant/real estate that is right next to a stadium, or you sell merch based on a pro sports franchise, etc., whatever the case may be, if the team is doing well, that should also be good for your business)
The benefits that the owners/management/players of a sports franchise get if they win are obvious - they get paid and enjoy the glory / recognition. What do you, the fan, get if a pro sports franchise in your city wins? Bragging rights? Hometown pride? lol... seriously, what do you tangibly gain by the Giants beating the Eagles? I suppose they might throw a parade and you get to celebrate the players and the bonuses THEY earned. Meanwhile, you are wearing a jersey that has some other dude's last name on the back of it for $200, and said jersey only costs $10 to make in some sweatshop somewhere... It might sound harsh, but the owners/management/players DGAF about you (even though you tuning in every night to watch it on TV / streaming or paying for tickets, merch, etc. is necessary for the whole machine to work) and the sooner you realize that and stop wasting time being invested in pro sports, the better off you will be.
Seems excessively reductive to me. There is a subjective, sentimental value that people gain from supporting their favorite sports teams. If you reduce everything to what it objectively is, then there are plenty of things that are worthless and meaningless - I mean, after all, what is the point of living when sooner or later we're all just dust in the ground?
Fans - enjoyment. Citizens - 'tax base'. I try not to judge others peoples enjoyment. Sports that cause permanent injury (MMA, football, boxing) maybe some judgement. If a person wants to pay $100 to watch ping-pong championship, or Starcraft II battles, you go enjoy yourself.
Just because your skillset or your thought process is Investment Banking since you’ve spent all day on WSO in the insular circle thought bubble doesn’t mean that has the highest value to society.
Value should accrue and is allocated based on value provided (in fact - it not always was the case that NBA / professional athletes made the money they did - it often accrued to the owners until players and unionizing was able to break way through the leagues - and is one of the reasons why baseball players have been very well compensated vs viewer base relative to other sports).
It goes back to market sizing and willingness to pay. Something is commoditized / not very different? Not a lot of value. Something is specialized and the consumer / enterprise values it? Value will accrue.
Pick something where value accrues and that you can be lights off at - finance historically has had a path to doing that since it’s a very specialized trait / skillset but that’s increasingly less so. The value that accrues in IB today is really based on relationships and information as opposed to spending 95 hours on a complex merger of equals model.
And no - you don’t know what it takes to be at the top of a sport so that’s a bad qualifier to begin with
I can't believe someone in finance would say such an incredibly dumb thing.
Sounds like something a socialist would say.
Something something supply and demand - Next question.
Owners make a lot of money. Therefore the players should make a lot of money. Football players are probably underpaid when considering the physical toll is takes on their bodies. y
Yes. They make a lot, not because of how hard they work or how talented they are, but because they make a lot of money for other people.
Ill ask a question now - How could you possibly feel that you will be worth your salary as a Y1 IBD Analyst? Odds are you will need help with almost everything, it will take your team 2x as long to walk you through the task and check your work as it would doing it yourself, and you will likely leave the firm within 1-2 years?
The reality is that very few of us deserve the salaries we make. @usernameladiesman217 gave a great answer - those who make a lot deserve it because they generate far more than they make. This is why consulting is a great way to start your career. You literally know your value. When I started, my bill rate was ~$200 an hour. Back of the envelope math says if I worked 40 hours a week and year round, I would generate ~$416k for my firm. No overtime pay for me, so I could in theory be working and billing 60-80 a week.
I made $65,000 a year, pre-bonus (spoiler alert, my bonus wasnt much), or 15% of what I could have brought in for the firm. There are a lot of other obvious considerations (e.g., what if I dont get staffed for 20% of the year, who wears that risk)
In short, you make a fraction of what you generate.
this is all empty talk until you define what 'deserve' means
funny I was just thinking wow, a mediocre SM HF analyst makes a lot more over 10 years than Cam Skattebo will make and Cam's better than all but a handful of people on earth at what he does.
makes me feel like pursuing all but a handful of pro sports positions isn't even worth it vs. white collar work
Nobody "deserves" or "doesn't deserve" the money they make.
What you earn is a product of your intelligence, industry, and network (built either by birth, effort, or some combination of the two, but which, without the first two qualities, remains worthless).
You “deserve” to make the marginal product of your labor
So…what I said?
One thing you'll pick up as you go along is that "deserve" isn't an important concept and doesn't impact anyone's compensation
WNBA players work extremely hard and deserve the hundreds of dollars they make for entertaining their fan
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