I think professional athletes get a bad rap for what they’re paid. People complain how LeBron James is paid $6 a second on or off the court just to play a game. Certainly numbers like that put in perspective how much more millions is than what most of us make, but I don’t think the magnitude should shock us away from it. There are many people out there who, in my opinion, probably deserve their fortunes much less than professional athletes do. I wouldn’t necessarily say they deserve our scorn, but maybe it can help us understand how to best allocate our resources.
Starting with athletes, they deserve their pay because they offer a valued service. A perhaps unfortunate truth is that things in society are valued not necessarily on the effort or innovation behind them but simply on what they offer to society. Brilliant mathematicians, biologists, and other academics can spend many years developing a new theory that maybe doesn’t have immediate impact on society, and they are forgotten. On the other end, there are “cloning” businesses that just copy a product or service from someone else and rake in the dough. Similarly, many people (including myself) enjoy watching professional sports and will pay money for tickets and merchandise for it. Athletes are the basis for those sports, and they receive much of the profit. The total salary can be quite large, but that’s simply because of the scale of their impact. Most jobs yield results that are limited in effect, but athletes can affect billions of people by their performance
Another point is that these athletes are not directly replaceable. There is only one best, active basketball player in the world, and he is LeBron James. We pay to see the best, and he is it. We aren’t satisfied (at least in this context) by an inferior team. Moreover, sports as a whole is well-developed to ensure that (with very high probability) the best athletes do make it to top billing. I’m comfortable saying LeBron is the best because of his raw performance and stats. There are many analysts and scouts both in the media and in sports organizations who work exhaustively to find the best talent, and from elementary school onward, we have development programs for the athletically gifted. I can’t be entirely certain abroad, but I’m pretty confident that those who excel in sports can find the right venues to feature their skills and move forward if they are truly the best. Professional sports is one of the true meritocracies in the world: performance is the most important metric for advancement.
Compare to the world of business, at least as much as I have seen. In business, a large part of success is who you know. People, whether fresh out of school for an entry job or an industry veteran looking at a leadership position, are often hired by reference or something along those lines, and it’s fair that many of them probably are qualified for the job. That many of these jobs are filled this way, however, indicates that there is a much larger population out there who weren’t as seriously considered for the role, some of whom could have been more qualified for the position. Recruiting and job hunting is still a major obstacle in today’s business world because many businesses neither have the reach nor the ability to effectively screen all potential candidates for a job. Perhaps the inefficiency is intrinsic: having that personal connection is valuable, and it’s hard to know from an interview how good someone actually will be. Even so, it’s hard to call something like that a meritocracy.
I think that luck also happens to play a much larger role in business. Granted, there’s a lot of luck play-to-play in sports, but even great players on bad teams can usually manage to earn a good salary or be traded to a team that will pay. Barring bad luck in injury, there are usually enough opportunities to demonstrate one’s ability. In business, however, so much of what happen is out of our control. Great businesses were crushed in the economic recession. Some websites or apps go viral because it got picked for one news story or picked up in one area while many other comparable products are left in the dust. A major contract is signed or falls through for things as little as someone being caught in traffic.
The difference in my mind between business and sports with regard to luck is that sports happen in a regular, well-defined, often replicated environment where one’s ability can be demonstrated with high certainty. Business (I’m thinking startups and entrepreneurship specifically), on the other hand, is a much looser world where no one really knows what’s going to happen. Success (and pay) can come out of nowhere, or disappear just as quickly. This is going to be extremely cynical, but I think even the biggest successes in business often provide stories that are illusory and understate the importance of variables outside of their control. They probably did a lot of things right and managed a lot of risk, but they also weren’t sunk by something out of nowhere.
Even if we get past execution, it’s hard to say that people in business get what they deserver when there are differences in opportunity from birth. Anyone born in the United States (or equivalently developed country) also has a huge leg up. Being born into a middle or upper class family helps even more. Most people who graduate from college worked hard to get it, but it turns out that family income is pretty good predictor of making that happen. I can’t concretely point out that sports are different, but I think stories like The Blind Side and the demeaning stereotype of dumb jocks indicate that we believe that athletes often don’t come from the best backgrounds.
So everything I have put out there so far has been really strongly-worded and definitely polemical (note I also have tried to avoid specifics to avoid demonizing anyone), but I really do want to offer a positive spin on this. First, lay off the hate: I don’t think it’s productive for us to be annoyed at how much professional athletes make. They deserve it.
Second, I wonder whether we can use sports as a model for improving our education in general. Despite the integrity of some of his work, Jonah Lehrer wrote an interesting piece awhile ago about athletic geniuses. I think our sports development program today is amazing: we identify talent at a very young age and have extensive support for it all the way through to adulthood. These programs are generally accessible and really foster the best athletes possible. I wonder how well we can do in trying to bridge inequities in general education as well.
Furthermore, how can we come up with better, more efficient ways to allocate talent? The world is inherently messy and irregular, so maybe we can’t quite get the regularized conditions of sports, but anyone involved in either hiring or looking for a job can speak to the huge difficulty there. The scope is much greater than what sports organizations deal with using their scouts, but I think this can continue to improve here.