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The NFL and The Salary Cap

Have to navigate fiscal waters

New York Jets v Buffalo Bills Photo by Joshua Bessex/Getty Images

The NFL has a dilemma involving the salary cap and the ability for teams to keep iconic players on their teams for their fan bases. This is not an indictment of the players or the owners. It’s just a situation where teams must use their salary cap in effective ways. The problem is that when teams draft great players who become generational players, they want to get paid very well. That is understandable, but players who aren’t really top five at their positions are also looking for huge cash. This is where the problem lies.

Don’t get me wrong, I believe a player should get whatever he can get during his playing days. The most useful thing that Rex Ryan ever said besides “lets go eat a G******n snack” is that every player leaves the NFL with injuries. No player, other than kickers, can play this game at this level without some lifelong injuries. I remember a former NFL running back said that every morning he had Rice Krispies, since he heard snap, crackle and pop as he got out of bed.

Now the owners are making bank, we all know that. Yet there is a contract between the NFLPA and the owners that sets the salary cap for all teams depending on the NFL’s revenue.

The problem is that the economics of an NFL team’s player salaries kind of mirrors the fiscal life of a middle-income family. Everyone wants the best of everything, yet there is only so much money to buy those things. The cost of housing, food, transportation, taxes, schooling and so on drain the pocketbooks of all Americans. I used to tell my kids that every week we earn a few beans and we put them in a can. We then use those beans to buy what we really need. Sometimes we have beans left over and sometimes not. When we do we can save those extra beans so we can add more beans to them. If we get enough we can buy additional things that aren’t necessities.

The NFL has a salary cap that has been stretched by GMs by adding voidable years to contracts. It’s like the NFL’s version of a credit card, you can buy more than you can actually afford but it’s gonna cost you in the future. The problem is it seems that NFL contracts for star players are growing much faster than the salary cap itself. That is a bad omen for every team looking to compete for a title.

There are currently 12 NFL QBs who are making $40 million and above (Aaron Rodgers isn’t one of them), a number that increases every time a top of the line QB signs an extension. A $40 million contract takes up 17.5% of the current $224.8 million salary cap. Yet now you are seeing other positional players looking for a huge payday. The Nick Bosa contract with the San Francisco 49ers averages $34 million a year. The 49ers can do that with Brock Purdy as their QB on a 7th round salary. Purdy is scheduled to make less than $4 million over the life of his 4 year contract. So what happens if Purdy leads the 49ers to a Super Bowl victory? I know that isn’t going to happen as the Jets will win that game, but what if Purdy gets the trophy and the game MVP? He’s going to want to be paid like the other top QBs.

There are currently 10 non-QB players who are making $25 million or above. That number is going to increase dramatically in the next few years.

Patrick Mahomes makes over $45 million a year, but other players make big money too. Chris Jones is currently the second highest paid player on his team, but Travis Kelce has a cap hit of over $14 million, Joe Thuney’s cap hit is over $22 million, Justin Reid’s cap hit is nearly $16 million and Marquez Valdes-Scantling has a $11 million cap hit. If you add in Chris Jones current salary then these six players make about $114 million, which is over half the yearly salary cap for a team. That’s just 6 players out of 53. That doesn’t leave much for the other guys. When one of those guys is out (like Kelce) you can see what effect that has. Next year Jawaan Taylor’s contract jumps from under $6 million to almost $25 million for each of the next 3 years.

You can see on the Kansas City Chiefs roster that all types of players are making bank, but the Jawaan Taylor’s or Joe Thuney’s aren’t the big named guys you associate with “gotta have guys” to win a championship. They are more like very good pieces (and I love Joe Thuney) to make up a championship team.

I know that GMs like Joe Douglas and Brian Veach in KC are looking for a supposed huge jump in the salary cap over the next few years. It is rumored that the salary cap for 2024 will be around $256 million and $282 million in 2025, so the teams will get some relief. Yet more players, some you barely have heard of, are going to want huge pay raises as well, so the beat will go on.

The New York Jets situation for 2024 isn’t looking as bad as first thought thanks to a $35 million pay cut by Aaron Rodgers; thank you very much. They can also move on from Laken Tomlinson and CJ Uzomah if they need to in 2024, which would save about $21 million in salary cap. John Franklin-Myers might be a target as well if he doesn’t show more this year to justify his over $16 million cap hit next year. However, the voidable years will catch up to the Jets as well. For instance the Jets will owe over $28 million to players who will not be on the roster, and Aaron Rodgers (if he is still on the roster) has a $63 million cap hit in 2026.

The Jets might be looking to sign an offensive tackle or two in 2024 since they don’t have a 1st round pick in 2024. To pry a great offensive tackle from a team isn’t easy since they can franchise tag them, so there may not be a viable option available. If the Jets do sign or trade for an offensive tackle that will stretch the finances even more.

A lot of this can be dealt with smart planning, but the Jets need to save as much money as they can, since the contracts for Sauce Gardner, DJ Reed, AVT, Garrett Wilson and Jermaine Johnson will all be pricey. Who knows what Sauce or Wilson will be asking for in terms of salary demands in 2025 and beyond. At the rate the salaries are escalating they could be $30 million a year type contracts.

It would be an immediate help if the Jets could find a few diamonds in the rough in the mid rounds of the draft. Those low salaried players who are of starting quality are like gold to a roster. They are competent players who have little impact on the current salary cap. They will eventually grow into players who need a hefty contract, but that is a nice problem to have. If they sign elsewhere and the Jets stay out of the free agent market they will reap the rewards of a compensatory pick, which will allow the Jets to draft another solid contributor at a bargain basement price. That’s the plan, now you just have to find those players in the mid to late rounds. It’s a lot harder than it sounds. The Jets drafted two players in the 4th round in 2020 (Cam Clark and James Morgan) who are already out of the League.

I know everyone wants the best players, but you have to be smart since a Trumaine Johnson type $72.5 million/5 year contract debacle is devastating to a team. Even the Spencer Long $28 million contract was debilitating enough, since he lasted only a single year, but the dead money was a hard pill to swallow. The key, especially now, is to draft well, then sign your own players if you can.

The salary cap is becoming a huge problem for teams to navigate since they must find ways to stay competitive while signing their key players to contracts. The key is to be able to find enough cap room to sign your foundational players when they come up for contracts. With non-QBs looking for huge contracts, teams will need to decide who to keep and who not to pay. Teams could be faced with some hard decisions.

It was never easy being an NFL GM. It gets harder every year.