Another important aspect of financial resourcefulness is the ability to offer competitive wages. In addition to paying vast sums for player transfers, it is also necessary to fund the contracts associated with the players in question.
Similarly, a successful club will also employ an array of professional support teams such as sports medicine, counselling and analytics. These would typically be complemented by competitive and capable business teams across marketing, management and many other departments.
Conventional wisdom would imply that more expensive players will require higher wages and more talent across support and business functions would also require adequate compensation.
Data may exist which enables detailed analysis of wages, however, we have not yet found this. Filings with Company’s House detail aggregate wages only. Below is an illustration of Liverpool and Manchester wage bills over time and we operate on the assumption that all staff contribute to success whether on the pitch, in the backroom or indeed in the front office.
This makes for some interesting viewing. Manchester City pulled away from Liverpool significantly from 2009 season to 2014 season where there is convergence. The rising trend continues thereafter. Perhaps the overall change in salary expense is most intriguing. From 2006/2007 season to 2017/2019 (12 years) the salary expenses have risen from 32.4M and 67.6M for Manchester City and Liverpool respectively, to 225.9M and 232.7M.
This represents a 597% increase for Manchester City and 244% for Liverpool in just 12 years. Now that’s inflation!