Ladies and gentlemen, welcome to the realm of hockey economics, where contracts are orchestrated as intricately as the plays on the ice. When a titan of the hockey world, or any other professional sport, signs a lucrative contract, it becomes a spectacle that captures public attention.
However, let’s not forget about those players who form the backbone of any hockey team, the unsung heroes who might not receive hefty salaries. Today, we’ll delve into the depths of NHL salary structures and take a look at the earnings of those who operate within the lower tiers of the salary spectrum.
Do NHL players get paid yearly?
Amid the backdrop of the NHL 2021-2022 season, where each night will witness masterful maneuvers and breath-catching saves, a question arises: What’s the financial reality for players occupying the lower rungs of the NHL salary ladder?
According to the collective agreement between the NHL and its dedicated athletes, the base salary for these players stands at a respectable $750,000 per year. This compares to $700,000 offered during the 2020-2021 season and the subsequent increase to $775,000 in the 2023-2024 season.
Onto the stage steps the “league minimum.” This is the minimum amount that teams are obliged to offer their players, set within the framework of the collective agreement—a pivotal accord in which league representatives and players lock horns to define the financial rules of the game.
In July 2020, a significant milestone was reached as the NHL and its players achieved a four-year extension of this very agreement, propelling the league minimum salary onto an upward trajectory.
Comparing the Lowest-Paid Players Across the Four Major Sports Leagues
Now, allow me to present an example of the increase in the league’s minimum structure, illustrating the shifting dynamics of the financial game in the NHL:
- 2025-2026: $775,000;
- 2024-2025: $775,000;
- 2023-2024: $775,000;
- 2022-2023: $750,000;
- 2021-2022: $750,000;
- 2020-2021: $700,000;
- 2019-2020: $700,000.
The spectacle isn’t confined to mere numbers. In this grand ice ballet, each team must navigate the waters of a fixed salary cap, working within a predetermined budget they can allocate to their warriors. As an example, consider the 2020-2021 season when the salary cap was set at $81.5 million.
Each team faced the challenge of assembling a roster of 23 players that fit within these financial confines. It’s akin to composing a symphony, where every note must harmonize within the bounds of the designated melody.
How Big Is the Gap Between the Lowest & Highest-Paid Contracts in the NHL?
The concept of Average Annual Value (AAV) has emerged as a financial marker inscribed in the contract of each NHL player. AAV is a fixed figure that, much like the North Star, remains constant throughout the duration of the contract. Let’s take, for instance, Mitch Marner, whose AAV stands at an impressive $10,903,000 over six years. This figure is integrated into the team’s budget for each season of his contract, regardless of the financial variations that might await.
However, the magic lies in the nuances. The NHL allows teams to allocate a player’s earnings into different categories, split between base salary and signing bonuses. Picture a chessboard where each player’s earnings adopt various configurations each year. For example, take a look at the fascinating salary dance of Marner:
- 2019-20: AAV – $10,893,000, signing bonus – $15,300,000, base salary – $700,000;
- 2020-21: AAV – $10,903,000, signing bonus – $14,300,000, base salary – $700,000, total salary – $15,000,000;
- 2021-22: AAV – $10,903,000, signing bonus – $9,608,000, base salary – $750,000, total salary – $10,358,000;
- 2022-23: AAV – $10,903,000, signing bonus – $7,250,000, base salary – $750,000, total salary – $8,000,000;
- 2023-24: AAV – $10,903,000, signing bonus – $7,250,000, base salary – $775,000, total salary – $8,025,000;
- 2024-25: AAV – $10,903,000, signing bonus – $7,250,000, base salary – $775,000, total salary – $8,025,000.
Interestingly, in this financial ballet, the AAV remains unchanged. This indicates the delicate balance achieved in these contracts—an intricate choreography of numbers that allows players and teams to elegantly dance within salary cap constraints.
Now let’s get back to the main rink. How many players are actually skating on these minimum contracts? As the curtain rises on each specific season, the answer to this question changes. Often, we witness a dynamic range of 70 to 150 players performing on one-way contracts. These fluctuations introduce an element of unpredictability, akin to the shifts and turns that make a hockey match so exhilarating. For example, during the 2020-2021 season, 86 players laced up their skates, having signed one-way minimum contracts with the league.
Turning to the intriguing concept of one-way and two-way contracts, we delve into the intricacies of financial flexibility. These contracts divide players into two distinct categories:
- Firstly, there are one-way contracts, where a player’s earnings remain consistent regardless of whether they play in the NHL or AHL. Their salary remains as unchanging as the ice on the rink. Then, there are two-way contracts—a double-edged financial sword. If a player competes in the NHL, they receive an NHL salary;
- If they descend to the AHL, their salary decreases—an apt reminder that in the world of professional sports, fate can shift as rapidly as a puck’s trajectory.
As an example, consider Gemel Smith of the Tampa Bay Lightning. Smith, straddling two worlds, entered into a two-way contract with the Lightning for two years. If he takes to the NHL arena, his salary will amount to a substantial $750,000.
However, if he descends to the AHL, his earnings will drop to $250,000—a striking contrast that underscores the financial history of the two leagues. Now, let’s momentarily shift our focus and conduct a comparison among the four American sports titans—NHL, NBA, NFL, and MLB. The stage witnesses a competition of league minimums, a test of financial mastery. One might assume that colossal financial magnets like the NFL and MLB would overshadow the relatively smaller NHL. Yet, reality departs from commonly held notions.
The NHL, seemingly the smallest contender in this competition, can boast the second-largest league minimum fee, surpassed only by the NBA. It’s a curving path that leaves the NFL and MLB, revenue giants, on the sidelines of the NHL’s financial current.
Imagine, for example, a player earning a staggering $12,500,000 per year, while another skater just a few pucks away is content with a salary of $750,000. This staggering $11,750,000 difference isn’t just a number; it reflects the value these players bring to their franchises. The elements defining a player’s value are multifaceted, akin to intricate plotlines unfolding during a game. Skill, for instance, is a priceless currency in the NHL. In the stratosphere of skill are those endowed with supernatural talents, such as Auston Matthews, Connor McDavid, and Sidney Crosby. Their contracts are true masterpieces, reflecting the value of their exceptional abilities.
Furthermore, the production factor takes center stage. Points, the lifeblood of victory, propel players toward lucrative contracts. In the NHL, points are akin to goals in the game—an ultimate path to triumph. The most prolific players in the league are often the highest-paid, underscoring these players’ pivotal role in propelling their teams to glory.
Just take a look at the names atop the leaderboards:
- Connor McDavid: 105 points, $12,500,000;
- Leon Draisaitl: 84 points, $8,500,000;
- Brad Marchand: 69 points, $6,125,000;
- Mitch Marner: 67 points, $10,903,000;
- Auston Matthews: 66 points, $11,640,250;
- Mikko Rantanen: 66 points, $9,250,000;
- Patrick Kane: 66 points, $10,500,000.
These luminaries illuminate not only the ice but also the financial stratosphere. Among them stands out Brad Marchand, who signed his contract during a time of lower salary caps. In today’s conditions, he could undoubtedly command a sum closer to $8-10 million.
A hidden dynamic is the phenomenon of brand power. Some players extend beyond the rink, becoming embodiments of their franchises. They draw in thousands of fans, leading to ticket and jersey sales—a financial flow reminiscent of a river. A prime illustration of this is Alexander Ovechkin, a 35-year-old dynamo who recently signed a colossal five-year contract worth $9,500,000. Although his on-ice prowess may inevitably wane, the strength of his brand remains a beacon justifying the high price tag.
But let’s momentarily switch arenas and venture into the AHL, the “underground” of professional hockey. Here, we encounter a stark financial contrast.
What is the Minimum AHL salary?
When comparing AHL salaries to their NHL counterparts, a remarkable discovery emerges. The difference between the two levels is truly immense.
At the core of this disparity lies a logical understanding: the magnetic attraction of the NHL draws hordes of spectators, leading to revenue streams that fuel opportunities for player earnings growth. But what exactly constitutes the minimum salary in the AHL?
According to the Professional Hockey Players’ Association, the current base salary in the AHL stands at $52,000 USD. Keep an eye on the horizon, and you’ll notice that in the 2022-23 season, this figure will increase to $52,500 USD, and in the 2023-2024 season, it will rise even further to $52,725 USD.
So, the numbers tell an astonishing story—between the compensation of the lowest-paid NHL athletes and their AHL counterparts, a chasm of $698,000 yawns.
Conclusions
It’s quite intriguing how we refer to $750,000 per year as a “low salary” in the NHL. Remarkably, these players out-earn teachers, doctors, and firefighters—and that’s while equipment is provided! Not a bad deal.
As NHL revenues continue to rise, talks of a new collective agreement are on the horizon, likely leading to an increase in the league’s minimum salary.
Those earning the minimum salary still stand to earn a solid playoff bonus if they make it to the postseason.
So, before trading the classroom for skates, remember that education comes first! (But a little puck play never hurts either!).