Major League Soccer (MLS) has come a long way in the last few years, with a growing fan base and a roster of talented players from around the world. One of the most interesting aspects of the league is the salaries that these players earn.
According to a league-wide analysis of salary data, the Major League Soccer (MLS) Average Salary for Senior Roster Non-Designated Players saw significant growth in 2022. The salary for these players increased by double digits, rising from $397,753 in 2021 to $438,728 in 2022.
The analysis revealed that salaries for players in roster spots four through 18 have been growing at an average rate of over 10% per year for the past five years. This indicates a strong upward trend in player compensation.
The Average Base Salary for Senior Roster Non-Designated Players reaching $438,728 in 2022 marks the eleventh consecutive year of growth. This data highlights the league’s commitment to providing fair compensation for MLS players, particularly for those who have been in the league for some time.
However, it’s important to note that the average yearly wage bill for all the players on a team is much higher than the average individual player salary. In fact, the average yearly wage bill for an entire team in the MLS is $8,170,454. This takes into account the salaries of all players on the team, including Designated Players whose salaries are not subject to the league’s salary cap protocol.
Overview of MLS players Salaries
MLS has a unique salary structure compared to other major sports leagues in the US. The MLS operates on a salary cap system, which means that each team has a budget for player salaries. In the MLS, the salary cap is a mechanism that limits the amount of money a team can spend on player salaries each year. The salary cap is set each year by the league and is designed to ensure parity among the teams and prevent wealthy teams from dominating the league by outspending their competitors.In 2023, the salary cap was set at $5.2 million, with a maximum salary of $612,500 for each player and However, there are some exceptions to this rule, like the Designated player rule.
The MLS teams have an extra $1.9 million in General Allocation Money (GAM) and $2.7 million in Targeted Allocation Money (TAM) that they can use to sign or re-sign players. GAM and TAM are both funds that Major League Soccer (MLS) provides to teams to help them build competitive rosters while staying within budget.
GAM can be used to pay down the budget charge of players, sign new players, or trade between teams, while TAM is specifically used to sign players whose salaries fall between the budget charge and the Designated Player threshold.
Having additional GAM and TAM gives the team more flexibility and options when it comes to building their roster and acquiring quality players.
What is the Designated Player rule?
One of the most significant exceptions to the salary cap rule is the Designated Player (DP) rule.
The Designated Player (DP) rule is a regulation that allows Major League Soccer (MLS) teams to sign high-profile players whose salaries would normally exceed the league’s salary cap.
For example, let’s say a team has a salary budget of $10 million for all its players. However, they really want to sign a superstar player whose salary demand is $5 million per year. Without the DP rule, the team would not be able to sign the player because it would exceed their salary budget. But with the DP rule, the team can designate that player as a DP, and only a portion of their salary counts towards the salary cap.
The DP rule was introduced in 2007 and is often referred to as the «Beckham rule» because it was created specifically to allow David Beckham to join the LA Galaxy. Prior to the DP rule, teams were limited in their ability to attract big-name players from other countries because of salary restrictions.
Each team is allowed to have up to three DP slots, and there are different ways in which a player can be designated as a DP. One way is by having a salary above a certain threshold, which was $612,500 in 2021. Another way is by paying a transfer fee for a player, which allows the team to spread the cost over the length of the player’s contract.
Overall, the DP rule has been a game-changer for MLS, allowing teams to sign top-tier talent from around the world and making the league more competitive.
Each team is allowed to have up to three DP players, whose salaries do not count towards the salary cap. This allows teams to sign high-profile players from around the world, often with salaries in the millions of dollars.
What is Targeted Allocation Money (TAM)?
Targeted Allocation Money (TAM) is another mechanism used by Major League Soccer (MLS) teams to bring in high-quality players without exceeding the league’s salary budget.
TAM is a fund that MLS provides to teams to help them sign players whose salaries are above the maximum budget charge but below the Designated Player threshold. For the 2021 season, the TAM budget was $4.9 million per team.
Here’s an example of how TAM works in practice: let’s say a team wants to sign a player whose salary is $1 million per year, but their budget charge would be $750,000, which is above their budget. Without TAM, the team would have to decide whether to sign the player and exceed their budget, or pass on the player. But with TAM, the team can use the fund to pay down the player’s budget charge to $500,000, which is below the budget but above the DP threshold.
TAM can be used in a variety of ways, including to re-sign current players or to sign new players. The funds can also be traded between teams, allowing for additional flexibility in building rosters.
TAM was introduced in 2015 as part of MLS’s ongoing efforts to improve the quality of play in the league and to attract more high-profile players. Along with the DP rule, TAM has helped MLS teams become more competitive on the global stage by allowing them to bring in top-tier talent while staying within budget.
Top Paid MLS Players
So who are the highest paid players in MLS? As of 2022-2023, the top five highest paid players in the league are:
1. Lorenzo Insigne – $14,000,000 Forward for Toronto FC
2. Xherdan Shaqiri – $8,150,000, Chicago Fire FC
3. Javier Chicharito Hernadez – $7,250,000 Forward for LA Galaxy
4. Michael Bradley – $6,500,000
5. Gonzalo Higuain – $5,800,000
Why Are These Players Worth the Investment?
While these salaries may seem high, there are several reasons why teams are willing to invest in these players.
1.Having a high-profile player attracts new fans and increases ticket sales.
2.These players bring a wealth of experience and talent to their teams, helping them perform better on the field.
3.Signing a high-profile player generates media attention and publicity for the team and contributes to build its brand and attract new sponsors.
In the MLS, the average player salary is $386,668, and the average yearly wage bill for all players in a team is $8,170,454.
Average Annual Salary by MLS team 22-23 seasson
The Average Annual Salary is the average amount of money that the players of the MLS temas makes in a single year. This figure takes into account the salaries of all the players on the team, and is calculated by dividing the team’s total salary expenditure by the number of players on the roster.
The Yearly Wage Bill is the total amount of money that a team spends on its players’ salaries in a single year. It includes the salaries of all the players on the team’s roster, including bonuses, incentives, and other forms of compensation. The Yearly Wage Bill is an important metric used in the world of sports to evaluate a team’s financial performance and to understand how much a team is investing in its players.It is important to note that the Yearly Wage Bill does not include other expenses, such as stadium costs, team travel, and other operational expenses that a team may incur throughout the year.
| Team | Average Annual Salary | Yearly Wage Bill |
|---|---|---|
| Toronto FC | $928,477 | $26,925,850 |
| Houston Dynamo | $757,700 | $14,265,000 |
| FC Cincinnati | $685,600 | $12,335,000 |
| Austin FC | $619,700 | $13,267,000 |
| LA Galaxy | $581,250 | $14,544,000 |
| Chicago Fire FC | $573,800 | $18,284,000 |
| St. Louis City SC | $458,400 | $8,718,000 |
| Atlanta United FC | $452,500 | $9,507,000 |
| Portland Timbers | $421,250 | $11,780,000 |
| Los Angeles FC | $387,250 | $9,294,000 |
| Columbus Crew SC | $385,388 | $10,405,500 |
| New York City FC | $384,500 | $9,588,000 |
| Sporting KC | $369,250 | $9,971,000 |
| Seattle Sounders FC | $367,500 | $9,178,500 |
| New England Revolution | $366,500 | $9,529,000 |
| Orlando City SC | $339,925 | $8,838,000 |
| Charlotte FC | $314,600 | $5,978,000 |