From stars to South American youngsters, the MLS change of course
Changes in the hiring profile of clubs in the league reflect incentives for hiring young athletes
Many championships around the world have well-defined positions in the fans’ minds, which is not always positive or true. You’ve probably already wondered where the player so-and-so will be and concluded with yourself that the answer would probably be China, “Arab world” or the United States.
For several years, this reasoning was not entirely wrong, given the flow of athletes who fell into oblivion by the general public and who actually worked in these countries. For some years now, however, this thought no longer reflects reality, especially in the case of the American league.
Major League Soccer (MLS) perceived as a retirement retreat for hosting several world football stars about to end their careers, has now become an interesting intermediary between young players who leave South America and intend to reach the main European competitions.
This change was mainly due to the expansion of the alloy and its growing attractiveness, favorable exchange rate and indirect financial incentives created by MLS itself.
Expanding League
As usual in the country, MLS follows a closed system of competition with franchises. This means that there is no relegation, but the (literal) purchase of the right to compete in the competition. The league that five years ago had 20 participants now has 27, and three new entrants are expected by 2023.
The next team to take part in the competition will be Charlotte FC, which in 2019 paid the league’s record $325 million. A few years earlier, in 2017, Atlanta United had paid $70 million, which is 4.6x the amount in just three years. This price increase for a team to be part of the league reflects the projection of future earnings for the new teams, and the scenario for the coming years can make these values increase even more.
This is because next year we will have a new negotiation of MLS broadcast rights, with the expectation of a considerable increase in relation to the current US$ 90 million per year. In addition, in 2026, the United States will be the main venue for the World Cup, which could further boost the popularization and development of football in the country.
Spending ceiling prevents attractiveness for equity
This context, which would be a wide-open door to attract high-level athletes, is, however, partially blocked by the league’s own ecosystem, since there is a limit on transfer expenses and salary payments there. A franchise can have up to 30 eligible athletes in its roster, and a salary cap of US$4.9 million (which will be increased by US$5.2 million in the coming years), with US$612.5 thousand annually being the maximum for a player can receive, far even from the values practiced in football centers not so big.
In order to be able to compete for high-level signings with foreign teams, MLS then created a category called “designated players” in which clubs can pay salaries above the established ceiling, becoming responsible for bearing the excess costs (understand more with video below):
Each franchise can have two designated players (with the option of a third upon payment of US$150,000 to the league) with salaries accounted for in different ways according to age, thanks to a change implemented in 2012.
Designated players over the age of 24 join the team’s salary cap account ($4.9m) with the maximum individual value ($612,500). Athletes who apply in the “young designated players” category are counted differently: those between 21 and 23 years old are registered with the value of US$ 200 thousand, and those under-20 are registered with US$ 150 thousand. In other words, there is space on the club’s payroll.
Furthermore, if the third designated player slot is also occupied by an under-23 player, the club is exempt from the extra payment, another economic incentive in hiring young promises.
Veterans give way to young promises (focused on South America)
As a result, the competition that was used to hosting media players at the end of their careers such as Didier Drogba, Steven Gerrard, Kaka, Bastian Schweinsteiger, Wanye Rooney, who contributed a lot to its popularization, gradually changes the profile of signings.
In addition to the context presented, the exchange rate devaluation of Latin currencies and the quality of life in the country make MLS have greater negotiating power in hiring South American players, serving as “intermediary” for the main European championships, a role that in the last two decades has been mainly played by the Dutch and Portuguese leagues (even more so for the Brazilians).
According to its own calculation based on transfermarkt data, in 2012 there were 77 players from South America playing in the US league, a number that this year rose to 140 (chart below), an increase of 81.8%. If we also counted those born in Central America, we would have almost half the increase: from 148 to 209* (41.2%).
*The numbers still have a slight change after closing the survey. Brazilians Luiz Araújo, Léo Chú and Lucas Esteves, as well as other South Americans such as José Mauri, Pedro Vite and Cristian Arango, among others, have also joined the league in recent days.
Analyzing even more these data, it is also noticed that there was a change among the Latin American nationalities. Players from countries like Jamaica, Puerto Rico and Haiti, who previously had greater representation in the league, gave way to Argentines, Brazilians and Mexicans.
During this period (2012–2021) the number of Colombian players also fell sharply. Even so, it is the 4th most represented nationality: 20 (previously there were 33), just behind Argentina(42), Brazil(26) and Mexico(21), countries that never had as many players in MLS as this season.
In the 2020/21 season, 28 athletes from these countries arrived to play in the United States, with emphasis on the Argentines, with 17 representatives. Five of these have even moved to the same club, Atlanta United, which can be explained in large part by the presence of fellow coach Gabriel Heinze, who left the club recently due to relationship problems.
Only Marcelino Moreno (former Lanús), Santiago Sosa (former River Plate), Franco Ibarra (former Argentinos Júnior) and Alan Franco (former Independiente) cost €16.6 million to the team. The 5th hermano, veteran Lisandro López, arrived for free, but he is no longer part of the cast either.
Also highlight for Venezuelans and Peruvians who have increasing exponentials from 3 athletes to 18, and from 1 to 7, respectively. Highlight for the purchase of Soteldo, ex-Santos, which cost €5.9 million to Toronto FC. See more in the chart below:
The low average age precisely shows the tendency of hiring young players, promoted in large part by the category of young designated players. Two Brazilians recently hired by US franchises signed under this condition: Brenner (who got transfered to Cincinnati) and Talles Magno (new New York City striker).
The recent report published by CIES Sports Intelligence confirms this trend: the average age of players who were active in South America when they were signed for MLS is 23.4 years, unlike the profile of those who were in Europe (26.7 years) , Asia (27.4 years) or even within Concacaf (26.3 years).
The Latin presence is not only present in promises, but also appear at the top of the list of the highest paid players in the league, released annually by the players association. In 2018, for example, three of the top ten on the list were Latino (two Mexicans and one Argentine), while this year the number rose to seven (three Mexicans, three Argentines and one Venezuelan).
