The NFL pays its players billions of dollars a year and fans pack its stadiums every week. But even the deep-pocketed league is shedding jobs.
League commissioner Roger Goodell said on Tuesday that the league will cut more than 10 percent of its staff in response to the downturn in the American economy that could put a dent in ticket sales for next season.
Goodell announced the cuts in a memo to league employees. The NFL will eliminate about 150 of its staff of 1,100 in New York, NFL Films in New Jersey, and television and Internet production facilities in Los Angeles.
“These are difficult and painful steps,” he wrote in the memo. “But they are necessary in the current economic environment. I would like to be able to report that we are immune to the troubles around us, but we are not.”
The NFL long has been regarded as one of the most wealthiest professional sports leagues on the planet. In September, Forbes called the NFL “the richest game” and the “the strongest sport in the world.”
The league has revenues of approximately US$6.5 billion, of which an estimated US$4.5 billion goes to players.
But now it joins the NBA, NASCAR teams and the company that runs Major League Baseball’s Internet division in announcing layoffs. The NHL hasn’t laid off workers, though it was in a hiring freeze, a spokesman said on Tuesday.
So far, NFL fans haven’t noticed the cutbacks, which also include reduction in travel by some league staff, and such secondary costs as printing and minor events. The NFL announced last month that it was reducing the cost of playoff tickets by about 10 percent from last season.
“We’re looking at everything with an eye to how we can be more efficient and reduce costs,” league spokesman Greg Aiello said.
The cuts will take place over the next 60 days, running past the Super Bowl, which will be played on Feb. 1 in Tampa. Employees who volunteer to leave will be offered what was termed “a voluntary separation program.”
The layoffs are separate from the cuts in front-office and other personnel being made by the 32 individual teams.
Aiello said the NFL still plans to throw parties at the Super Bowl, elaborate events for which the game has long been known.
However, local organizers say the companies that regularly host their own parties are watching expenses, scaling back plans and inviting fewer guests.
Goodell said last month in an interview that the league and its teams could feel the economic slump in sponsorship and marketing.
Ticket sales for this season have been strong and stadiums have been largely sold out. But NFL officials, including Goodell, believe that was because season tickets for this year’s games were sold in the spring and summer. The commissioner feared the league and its teams would take a bigger hit when season tickets go on sale next spring for next year’s season.
Marc Ganis, president of Sportscorp Ltd, a Chicago-based sports consulting firm that works extensively with the NFL, says pro football was unlikely to feel the downturn as badly as MLB because it has fewer tickets to sell and still has a guaranteed revenue stream in its national television contracts, which dwarf those of other sports.
But he noted that the league also has fixed costs — almost 60 percent of its total revenue will be paid to players this year, with an increase next season. Labor costs are one reason the NFL opted out of the labor contract, which will now expire after the 2010 season.
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