National League Payrolls 17% Higher than American League
So far the average MLB payroll for the 2023 season adds up to approximately $157 million per team. The National League is outspending the American League however by a wide 17% margin.
*Numbers presented here are courtesy of Roster Resource at Fangraphs.
Fangraphs Roster Resource
While the Carlos Correa deal has not yet been finalized due to concerns over his medical examination, his contract numbers are included in the New York Mets figures. Should he ultimately end up with an AL team that would shift some of these numbers but not enough to reverse this clear trend.
Much like the New York Yankees explosion in spending 20+ years ago led to higher payrolls among AL teams, it seems like NL teams trying to keep up with the Mets, especially in the NL East, have contributed to the gap. As can be seen in the table above, even if you remove the two New York teams the gap between the two leagues is still a sizable 13%.
In addition, when broken out by tiers of top five, middle five, and lower five, the NL is outspending the AL at each level. This can also be visualized by the two tables below, lining the leagues up side by side and also in one row, color coding Blue for NL and Red for AL. Four of the top five spending teams are in the NL, and five of the bottom seven teams are in the AL.
Fangraphs
Private equity investment in the Padres has allowed that organization to overtake the Dodgers as the biggest spender in the NL West. The Dodgers have largely been on the sideline this off season when it comes to high dollar free agents. That is due in large part to the timing of the decision on Trevor Bauer's suspension status, creating payroll uncertainty at an inopportune time for L.A. Their current $217M payroll is still one of the highest in baseball however.
Now that most of the more expensive free agents are off the market, some of the teams in the lower and middle tiers will see their payroll numbers increase over the next six weeks. But the general trend of NL spending being higher than AL for 2023 is unlikely to be affected.
The Diamondbacks payroll meanwhile ranks 21st overall, 11th in the NL, and last in the NL West. Their current $106 million figure is just 67% of the MLB average, 62% of the NL average, and perhaps most importantly, just 52% of the average of the other four teams in the NL West.
This is in line with the average rank of 20th in MLB for the team over the last 10 years. Most of the deferred salary debt from the Jerry Colangelo era was finally paid off by 2013, so it's a more accurate to view the D-backs payroll rankings since that time. There are a few seasons where the organization approached league average payroll in that span. But most of the time they've been well below the average.
Until the Diamondbacks stadium situation is resolved, it may be more difficult for the team to achieve a league average payroll. As reported by Barry Bloom in May of 2021, the lease on Chase Field runs through 2027 and they are responsible for all maintenance on the stadium. (Much of which seems to be deferred) The Arizona legislature approved a sales tax of 9% on all items sold at the stadium to fund up to 80% of the proposed cost to renovate Chase Field. At the time that was estimated to be about $500 million, but with inflation sending costs soaring and the team still responsible for 20% of the expenditure, they will likely still be limited in what they can spend on payroll in the foreseeable future.
Another major factor is the uncertainty over their television contract. Diamond Sports, which operates a number of regional sports networks under Sinclair Broadcast Group, is on the verge of bankruptcy. Whether or not they will be able to continue to pay out according to the 20 year, $1.5 billion deal reached with the Diamondbacks in 2015 is now in question. Any new buyer should Sinclair sell off Diamond might want to renegotiate with teams as a condition of purchase.
With National League spending shooting well past the American League, and two of the biggest spending teams in their division, the Diamondbacks ability to draft and develop players internally and make savvy trades is more important than ever if they are to become and remain competitive. It can be done, as evidenced by teams like the Tampa Bay Rays, who have made the playoffs four straight years and had a winning record in five straight. The Cleveland Guardians in the AL have been competitive almost every year despite low payrolls. But playing in the AL Central makes that a little easier perhaps.
The Milwaukee Brewers, who also typically have below league average payroll, have made the playoffs four of the last five years and had a winning record in five of the last six.
When Mike Hazen took over the Diamondbacks as GM in 2016-17 he inherited a farm system that was one of the worst in the league. Since then he has built up a good system, with a Top 30 prospects list that is the envy of all but a handful of other organizations. The team has started to graduate a number of prospects that have shown promise in their brief major league stints so far. This then will have to be the path for the D-backs, as even the occasional bumps towards a league average payroll may be less frequent over the next five years or more.
