Money Makes The World Go Round: Wages in The Premier League

Liverpool owners Fenway Sport Group are criticised for not spending enough on transfers. But Premier League salary data shows that is not the full story.

The football world would be a better place if signings were reported with their total expenditure figure. Darwin Núñez cost €25m more in transfer fees than Erling Haaland, per Transfermarkt; according to FBRef, the Norwegian earns around €14.5m extra every year.

This basic analysis doesn’t take account of agents fees, renegotiated contracts and anything else which pushes the financial commitment up. But this Substack is not the peerless Swiss Ramble, either. We can just take an overview, leaving accountancy to the experts. The salary data is also partially estimated by Capology, so should not be taken as gospel.

The point about players costing more than their initial transfer fee comes to mind during every transfer window. Liverpool owners Fenway Sports Group are disliked by a sizeable section of the Reds’ fanbase for the club’s reticence in the market. Transfermarkt’s five-season analysis shows that Liverpool’s net spend since the summer of 2020 is €30m below what West Ham have invested, a similar margin above Nottingham Forest’s net transfer outlay.

Paul Tomkins proved the flaw in looking at such figures long ago. By purchasing Alisson Becker, Mohamed Salah and Virgil van Dijk in 2017 or 2018, for instance, there was no need for huge outlay in their positions in the last six years. Even so, isn’t it reasonable to expect a Champions League regular to spend significantly more than the smaller clubs, especially those that were not even in the Premier League for the entirety of the last half decade? Most Liverpool supporters believe so.

Like Tomkins, Liverpool’s former director of research Ian Graham believes around half of transfers fail. “In a game where the average success rate is 50%, refusing to play unless you have a good reason to can be a good strategy for success,” he wrote in arguably the defining line from his excellent book. Graham also noted: “in football, 65% of revenue is spent on wages, and 25% on transfer fees. We’ve seen that a huge fraction of that money is wasted.”

With so much income passing from club to players, criticising the former for its net spend is largely pointless unless you account for its salary outlay. How do the Reds compare to their peers in this regard?