The Economics of United States Soccer: Past, Present, and Future
Followed by over 3.5 billion fans worldwide, soccer (or football as it’s called outside the United States) is the most popular sport worldwide, and its popularity is only increasing. For context, A whopping 5 billion people are expected to watch the Qatar-hosted World Cup in December of this year. With such immense popularity comes even greater profit for soccer teams. However, in the United States, the sport remains less popular compared to other countries worldwide, though it has won its acclaim over the past few decades. What exactly does this mean for the economic future of soccer in the U.S?
Soccer has gained traction over the years in the U.S. In 2020, 17.8 million Americans played soccer, surpassing ice hockey to become the fourth most popular sport in the country. This change has replaced the long-standing position of the “big four” sports in the U.S., basketball, baseball, and football, which have always seemed to make other American sports tiny in comparison to their massive popularity. Recently, the largest crowd at a Major League Soccer (MLS) game amassed a record 92,516 fans in New England Revolution’s match against Chivas USA at the Los Angeles Memorial Coliseum.
Record attendance of an MLS game (92,516) at the Los Angeles Memorial Coliseum
However, the MLS stills fall far behind European leagues in terms of both viewership and caliber. From a smaller market to less prestige than reputable European clubs, the MLS has a long way to go before it can come close to competing against top European clubs.
Founded in 1996, the MLS is in its infancy compared to the world’s most popular soccer league, the Champions League, which was founded in 1955. Created at a time when not many Americans played or followed soccer, few investments were made into the league during its first years. In 2002, the MLS reached losses of between 250 to 300 million dollars. These astronomically low margins were coupled with only ten teams, with six of those having been owned by the same owner.
Despite initial struggles, Soccer has begun to gain traction in the U.S. as a result of success in international games and broadcasting on major T.V. networks. The U.S. Women’s National Team, in particular, has helped generate interest in soccer. After their victory in the 2002 Women’s World Cup, and consecutive wins in 2015 and 2019, individual players have been offered lucrative brand deals by companies such as Coca-Cola, Nike, and Panasonic. Furthermore, despite the fact that the MLS is not as strong as many European Leagues, it has helped produce some of Europe’s biggest stars, such as Alfonso Davies. His talent in the MLS got him scouted in 2018 by Bayern Munich, one of the world’s best soccer teams, for an MLS transfer fee record of 22 million dollars. While Davies, coming from a smaller-sized league, was not recruited for a price nearly as high as Neymar’s record of 263 million dollars, the transfer signifies that the MLS is a competitive soccer league that will continue to improve in the decades to come.
Competition: Why the MLS May Struggle to Acquire High-Level Players
Although the MLS has brought promise to its professional soccer league, it faces immense competition abroad. Many leagues in other nations are attempting to develop their once-limited market and fan base by flushing money toward team development. For example, The Chinese Super League has acquired well-known players from Europe’s “Big Five” leagues with their willingness to spend more than their competitors and high salaries. Notably, the Chinese team Shanghai Port acquired Oscar for a record-breaking fee of 84 million U.S. dollars. At age 25, Oscar chose to leave Europe during his “prime,” when players are at their best, earning over three times what was expected if he remained with his former team, Chelsea FC.
In contrast, many players in Europe’s top leagues have remained hesitant to move to the United States during their “prime” because they would not have the opportunity to play against the world’s top players and would still earn a similar salary. This does not mean that MLS is destined to fail, however. In recent years, the MLS has drawn in soccer players nearing retirement. These players can become a part of MLS teams at lower transfer rates than when they were at their “prime,” yet still maintain massive popularity from their years in Europe. Most notably, Cristiano Ronaldo, who was voted the best soccer player in Europe on five separate occasions and remains the most followed person on Instagram with nearly 500 million followers, has been linked with a move to MLS team LA Galaxy.
“I know that many players move there. I think it’s becoming better and better. It’s growing. I think it’s good. It’s good for me and young players that maybe one day we want to move there. So it’s good that football — ‘soccer’ — grows there.”
- Cristiano Ronaldo
U.S. Youth Soccer Development
Another essential way to increase the popularity of the MLS is to develop effective soccer programs domestically. Already expanding nationwide, these programs have demonstrated improvements in United States soccer after the National Team qualified for the upcoming 2022 FIFA World Cup with the youngest squad of all qualifying teams at just 24.07 years. However, these teams are not available for everyone. According to Steve Inskeep from NPR, “Just registering for a club team can run about $1,500 per year.” These costs can deter aspiring youth players from choosing the sport. Furthermore, that number is especially high when compared to other countries, such as Mexico, where clubs cost only around $100 per year. While there is certainly justification for these high prices in the United States, partially due to the lack of coaches to keep up with the growing demand to play the sport, financial accessibility could demonstrate why the sport is more popular in other countries. Seen as a way to escape poverty or low income, in other countries, soccer has given millions the chance to play the sport they love professionally; in fact, the sport is especially immersed into countries’ cultures and the everyday lives of people there.
Takeaways
Regardless, the large U.S. population provides it the opportunity to expand the already large number of soccer players in the United States and has signified the MLS’s ability to make soccer an attractive sport nationwide. While it does face immense international competition, the upcoming decades will only serve to increase the massive market for soccer as it continues to grow more competitive — however, we must give it time for the U.S. to amass the popularity and investments it needs for this to become a reality.
