In the 2020 summer transfer window, Premier League Transfer expenditure on players hit a total of £1.24 billion which is not the perfect definition of the current financial reality in the league. Since the coronavirus pandemic hit the Premier League in mid-March and indeed the entire English football, every club has been hit by a serious financial hardship.
Though some clubs have had reasons to spend heavily on players during the transfer window, yet, every club, both in the Premier League and in the lower leagues, are lamenting and looking for means to stay afloat amidst the widespread financial hardship.
Some top clubs are looking for means to cut costs by laying off workers that have been made redundant due to the coronavirus pandemic which has forced some restrictions on the regular operations of clubs. Others have embraced pay-cuts. While few have embraced both methods.
Though the Premier League clubs spent the highest amount in the transfer market this summer when you compare the amount other leagues in Europe spent, yet, the reality in Europe remains the same across the board. If one notes the fact that in the last 3 transfer windows, the Premier League spent lesser in this year’s summer transfer window, that could be a pointer that all is not financially well with the league.
According to Deloitte, a financial expert that usually analyses Premier League Transfer expenditure on players in every transfer window, in 2017, the clubs in the league spent as high as £1.43 million on players; in 2018, the clubs’ spending dropped to £1.23 billion, while in 2019, clubs spending during that year’s summer transfer window jumped to £1.41 billion.
Though Deloitte is yet to release its analysis of clubs’ expenses for the just concluded 2020 summer transfer window, one can rely on the £1.24 billion that has been in the public domain since the window closed on October 5. Based on that figure, it means that clubs’ expenditure on players dropped by just £17 million which was not a huge difference as far as the financial reality on the ground is concerned.
Premier League Transfer expenditure and the worry for English football
It is obvious that the coronavirus pandemic has successfully changed how things are done across the world but it is yet to change how some clubs in the Premier League spend on new players. Every club in the league want to stock their squad with the best set of players money can buy. This has made the league the most competitive league in the world and arguably the most followed league in the world.
To broaden how financially reckless clubs in the league were in the last transfer window, the “International Transfer Market Snapshot” Fifa published immediately after the window closed would go a long way to prove that the Premier League clubs want the world to believe that all is financially well with the league.
Fifa publication put it that Italian teams spent £418m/$544m; Spanish teams spent £375m/$487m; French clubs spent £350m/$455m; while German teams spent about £270m/$350m.
This means that the Premier League spent at least three times more than any other league in Europe in the 2020 summer transfer window. This directly contrasts the fact that clubs in the lower leagues in the United Kingdom are battling to survive or stay in business.
Those big clubs that are still trying to paint the picture that it is not as bad as it seems, are not ready to help other clubs to survive the harsh financial reality which is sinking them away.
The government in the United Kingdom has been bringing up different policies, including the furlong policy, to help clubs to survive. But it seems all those efforts can not yield much. Like a spark of hope, the Department of Culture, Media and Sport have always stressed how much they want to help the struggling clubs. But nothing is forthcoming yet.
All these have made clubs that are bold enough, to look inward for a way forward. Some of the ways forward most of the clubs are embracing are to cut salaries, sack some redundant staff, and send unused players on loan or allow them to go as free agents.
Yet, with the way things are going, if fans don’t return to stadiums as they used to as soon as possible, the only way forward that could prevent clubs from completely going out of business is for the government in the UK to step in financially.
The financial crisis in club football: Why the UK government might look away
One thing that makes most footballers dream of playing football in Britain is the fact that clubs in the leagues especially the Premier League pay so well. Clubs pay as good as giving players weekly wages which an average worker in the UK will never earn for a whole year of hard work.
For instance, on the average, clubs in the Premier League spend about £200m each per season on players’ salaries alone. A top Premier League club like Manchester United spends over £350m on salaries, Manchester City spends nothing less than £315 million; Chelsea spends about £314m while Liverpool spends over £310m.
Premier League expenditure on wages has sparked critics to advocate for a salary cap which seemed so difficult to adopt holistically. So, smaller clubs are finding it almost impossible to compete on the pitch if they don’t have the resources to pay their players as much as the bigger clubs pay.
Amidst all these amounts of funds flying around in the league, the financial hardship is becoming apparent and it seems every club believe that the hardship would go immediately the government permits fans to return to match venues.
However, from all indications, the clubs, especially the big ones, are yet to show enough signs that they are financially stretched. When they do, the government might pay more attention to the plight the smaller clubs have been facing since the coronavirus pandemic started.