The women’s soccer pay gap

Question

I saw that the women’s soccer team makes less than the men’s (USA). I also saw that the men’s teams make 9% of the total revenue while the women make 13% of the total revenue. Is there a source of money that women are not getting or something? If they want to increase the pay where would the money come from?

EDIT: There’s a bill that was introduced that would shut down the US hosting the World Cup until the pay gap was fixed. My question is how would it get fixed? I understand the women generate less revenue therefor make less. So how would they get paid more? If they were to increase the percentage they make from the revenue it would pay them more but then that would be unfair to the males.

In: Economics

Answer 1

National sports teams are tricky from a labor economics perspective because they’re essentially side-jobs for their workers. This means that a key determinant of how people are paid is what they’re paid at their regular jobs.

Essentially, US Soccer wants to attract top talent to its teams, and it wants to pay the minimum possible to do so. It will typically cost more to get a player making $1,000,000 on their club team than to get a player making $100,000, even if those players ultimately generate the same revenue for the national team. Players weigh the costs and benefits of playing for the national team, and those with more to lose (especially from the added risk of injury) will want a higher salary to play. Thus, because female players have a lower earning potential in club play, they can be enticed onto the national team for less money.

The players speaking out about it is just an ordinary labor dispute. They believe (with pretty good reason) that they’re being underpaid, so they’re making a stink about it. They’d have better luck if they were making credible threats to not play for US Soccer in the future until this was fixed.

Lastly, there’s nothing in labor economics that guarantees wages will be set in a “fair” way, but at the same time, we have many laws and mores in place to help steer them in that direction. In that sense, the public also have a right to put pressure on US Soccer to change how they pay athletes. You also have a right to believe that these changes would reduce fairness. Unfortunately, there’s no consistent economic definition of the concept.