The highest-paid neurosurgeon in the United States makes around $500,000 a year. Their education takes between 14 to 16 years, which means they are well into their 20s when they start working, and they probably won’t be making anywhere near $500,000 until they reach their forties. The average salary of a professional soccer player is 3 million a year, and they’ll be making that sum before their mid-twenties.
Is this gap unfair? After all, professional athletes don’t save lives as surgeons do. They don’t have to study for decades, get into school debt, or spend any sleepless nights during residency. The reason behind this difference is a combination of factors, and as with most things in the modern economic system, we have to take supply and demand into consideration.
How many people will require surgery in the span of their lives? How many surgeries are performed yearly? How many people consume sports as a form of entertainment, and how many sports events take place in the span of a year? Every year, 15 million Americans have some kind of surgery. However, in 2022, live sports were watched by approximately 60 million Americans, a number that is projected to rise to over 90 million by 2025.
The career of a professional athlete is pretty short, with most pro athletes reaching a peak in their careers between their 20s and 30s. This very short age window reduces the pool of candidates for the profession. Also, while a lot of young kids dream of becoming professional basketball or soccer players in the future, very few actually have the skills the industry requires. The number of individuals that can provide this highly demanded product is very small, making the number of consumers and investors willing to pay for it much larger.
Also, entertainment is one of the highest-paying industries. People have always craved some kind of entertainment, to relax and forget about the tensions of the day, to bond with others, and to escape reality. Knowing that entertainment is one of the industries with the most consumers, brands pay millions to have their ads placed in a sports event because this move is guaranteed to get them massive reach and revenue.
Finally, we have to take into account productivity. Worker salaries are a combination of how much or how little the industry pays and how much or how little productivity the worker can contribute to that industry, with the lowest salaries being those of low-productivity workers in low-paying industries and the highest wages being those of high productivity workers in high paying industries.
Professional athletes happen to be in that second category. The product that the top athletes are selling is in very high demand. However, not all professional athletes are created equal. In the US, the high productive athletes are paid much more than lower-skilled athletes. There is also the matter of the gender gap: because a smaller number of people consume female sports, the top US men’s soccer league players are paid much more than players from the top women’s soccer league. The productivity levels might be similar, but the price of the products sold is very different.
There have been attempts to control these huge earning gaps. In the larger leagues in the US, the workers are unionized so they can collectively bargain for higher wages for the lower-productivity workers. Some leagues have a cap on player wages, but the top players can often earn more wages from product endorsements as well.