09 June 2016
If you want loyalty – get a dog
Jamie Vardy’s choice is an economic one
by Frank O’Nomics
What price loyalty? There has been a general outcry this week, mostly from Leicester City fans, about the possible transfer of their star striker, Jamie Vardy, to Arsenal. Such a furore always happens when a rising star at a minor club is sought by one of the big names. How could an individual who was discovered and nurtured by the junior club turn his back on them? Leicester City are prepared to further increase his wages (having only four months ago raised them to £60,000 per week, allegedly) and, if he remains, he is seemingly guaranteed local hero status for life, having helped Leicester achieve their 5,000-1 against Premier League title. If he goes, he risks “warming the bench” at a major club (Arsenal seem most likely at present), given that he will be competing with other proven star players for a place on the pitch, and may not get the profile to perpetuate his England career (along with the earnings from endorsements that would bring). The response to all of this, as ever, boils down to economics; for Mr Vardy (and his agent), the best chance of him maximising his earnings potential is to leave. For Leicester City the potential to get a £22 million transfer fee would give them much needed resources to help them stay in the top flight
This debate has been running for a long time. In 2006, Ashley Cole (cruelly nicknamed “Cashley”) claimed that he “almost crashed my car” on hearing of the derisory proposed wage increase (to £50,000 per week) that Arsenal offered him to prevent him going to Chelsea. Was he wrong to go? I think that he might argue that, apart from the additional income, the winning of the Premier League, four FA Cups, one League Cup and the Champions League are more than sufficient justification. Jamie Vardy can reasonably ask himself whether he is likely to win more silverware with Arsenal than with Leicester, and the answer will be fairly obvious. Even if he plays a modest number of games, his achievements as a player are likely to be more impressive.
Let’s look at what everyone would be turning down if Mr Vardy were to stay put. For him, as we have discussed, there is the higher salary (Arsenal are reputedly offering £120,000 per week), greater income from endorsements and a better prospect of winning trophies, but this has also to be put in the context of a footballer’s career longevity. At 29 Jamie Vardy realistically has little more than 5-6 more years as a top player, with an ever present injury risk potentially reducing this time further. Would he not be best advised to maximize his earnings potential while he can? For his agent, there is little doubt that he would recommend a move; typically he would be paid 10%, but there are other facilitators meaning that, overall, closer to 28% of transfer fees get paid to agents and third parties. As for the club, it may be a fine balance between keeping the key player who can make a difference or utilizing the transfer fee to build greater depth to the squad. They too suffer the risks of key player injuries and increasing the wages of one creates a dangerous and divisive disparity with the rest of the team.
There are some notable examples of players who stuck with the club which gave them their big opportunity. Steve Bull played for Wolves for 13 years and, despite being a prolific goal scorer and gaining England recognition, he only played once in the top division (and then only as a sub for West Brom). Wolves were approached a number of times but, partly in response to a local newspaper campaign, Bull backed out of the chance to play Premier League football for Leeds, Coventry and Newcastle. Bull has retained local hero status and even has a stand at Molineux named after him. There is a similar story with Matt Le Tissier who spent his entire 16-year playing career at Southampton. Southampton did enjoy long periods in the top flight, and Le Tissier became the first midfielder to score 100 Premier league goals, but Southampton spent most of their time avoiding relegation and top clubs were constantly looking to buy him (notably Manchester United). The point is, at that time (1990s), both Le Tissier and Southampton felt able to resist the economic benefits that a move would have generated. Even then this was rare, and now the difference in players salaries, endorsement fees and transfer values make a rejection of the additional benefits foolhardy.
Premiership football is a mercenary business, with strikers of fortune selling their labour to the highest bidder. It is not, sadly, about a commitment to your team, beyond the period of a contract and the 90 minutes on the pitch – and even then you might hold back for fear of injury threatening an imminent approach from a major club. This is difficult for the die-hard football fans. Look at the relative economics for them. When one factors in the cost of tickets and transport to away games they will be spending a significant proportion of their income, often in excess of 10%, on supporting their club. If an Arsenal player receives £120,000 per week, then around £4 of the price of each home ticket (assuming a gate of 60,000 and that the team plays at home around every 2 weeks on average) is going to pay the wages of just one player. They want to have the best team possible, but will have to realise that cost implications mean that a balance has to be struck. The sad truth for Leicester fans is that these economic truths mean that they could be losing a number of their key players ahead of next season. To be fair to Jamie Vardy, he does seem to be agonizing over the prospect of leaving the club that took him from non-league obscurity just four years ago, but ultimately he is likely to choose salary over sentiment and it is difficult to see who could argue with him.
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