It has been a long time coming over the past decade, but Everton has a decision to make about the future of the club. The latest financial report puts player wages at 79% of turnover for a total of approximately 63.2 million pounds. While the wage bill itself is not particularly astounding, the percentage related to turnover is alarming.
The accepted sweet spot for player wages is at about 50% of turnover. This allows the remaining income to be used on club operating expenses, with a tidy sum left over for player purchases. At about 70% is when a club should be really concerned, and with Everton close to 80% it is about time to hit the panic button.
A lot of folks may be asking how our wage bill could be so high when we haven’t brought in a lot of new players. The key is in the club’s desire to keep the biggest stars at the club. Players at Everton don’t make more than 70-75k per week, and even at those prices a player has to be a star. One of the biggest reasons for Mikel Arteta’s departure from the club is not the 10 million pound transfer fee, though it certainly helped, but rather removing his expensive wages from the book.
Tim Cahill’s departure this summer was also a similar move. Both players had lost their effectiveness in their last season in blue, and while the transfer fees were not as high as fans would have liked, clearing wages was too important to draw a line in the sand on the price.
Unfortunately it could be ugly if Everton has to clear a lot of the higher wages on the team. This is when we would begin to lose players like Baines, Fellaini, and even Jagielka. While the club would get some good money for these players, the loss in talent could be too much for even David Moyes to overcome. Instead of competing for Europe we would be competing to finish in the top half of the table.
To get around this, Everton needs to begin shedding salary on role players. If a player is making 40-50k a week and isn’t starting, then he needs to go, especially if he isn’t performing up to his salary. Some may complain that this would leave us to thin in case of injury, and the response is we already have problems when an injury bug strikes. Removing 2-3 players who don’t seem to get much time during injury crises isn’t going to affect the club, but saving 120-150k per week is fantastic.
Many folks will point to qualifying for the Champions League as a way to avoid the impending wage bill crisis, but one year of CL football is not enough. All an extra 10-20 million pounds for a single year does is get you in the black and possibly pay some debt off. Just ask clubs like Leeds what happens when you bank on future Champions League money to pay your current wage bill.
If Everton is going to weather this storm, they need to begin shedding the salary of role players, and possibly bite the bullet on some of their stars. Everton has always been famed for the quality of their youth system, and with players like Barkley and Duffy coming through; it may just be time to give them a chance. Not only would it help the club financially, but they could even do better than the men they replace.