One could argue that the coaches market in the NBA is a mess. When we dig into the numbers though the truth is that the uncapped crazy owners market is a sign of how to reign in owners’ costs. When we look over the coaches data it seems like the owners don’t seem to have any clue what they’re doing. However, when we look at the trends of the coaches as a whole it seems like maybe the owners are learning.
Using the amazing coach data collected by Michael ‘wiLQ’ Wilczynski over at Weak Side Awareness we can break down the owners stupidity and intelligence.
The Owners’ Stupidity
Since the 2006 Season:
- The estimated cost for money owed to fired coaches from 2006 to 2011 is $100 Million
- An estimated $21.9 Million was owed to fired coaches in the 2010-2011 season
- 29 Coaches have been fired and 1 has “resigned” (Jerry Sloan)
- 10 of said fired coaches have gone on to coach on other teams (with Eddie Jordan being fired in his second endeavor)
- 19 teams have fired a coach
- 9 teams have fired multiple coaches
The coaches market seems troubling. There’s crazy movement. Salaries are uncapped and this seems to have bad implications. With an estimated salary of around $88 million to active coaches last season to have almost $22 million to fired coaches seems troubling. After all if this were the players and the same ratio were true then the owners would be on the hook for almost $500 million.All of the problems that we’re told would exist in a players market without rules exist in the coaches market. That’s bad right? Not so fast!
The Owners’ Intelligence
| Season | Salaries | Fired Salaries | Total | Ave Contract Length |
| 2005-2006** | $115.60 | $40.60 | $156.2 | 3.7 |
| 2006-2007** | $117.90 | $37.40 | $155.3 | 3.5 |
| 2007-2008** | $114.50 | $32.70 | $147.2 | 3.4 |
| 2008-2009 | $105.60 | $17.50 | $123.1 | 2.7 |
| 2009-2010 | $96.50 | $23.70 | $120.2 | 2.9 |
| 2010-2011 | $86.90 | $21.90 | $108.8 | 2.7 |
** Includes fired contracts from previous CBA
Surprisingly things have changed for the better in terms of coaching salaries. Even including all the insane money wasted on fired coaches the owners have cut coach costs from 2006 significantly. The average coach contract length has only gone down. In fact in 2011 two amazing things were true:
- Only one coach (Doc Rivers) had a contract length of five years or longer
- Only
one coach was firedtwo coaches were fired! (Thanks wiLQ!)(Jim O’Brien, Kurt Rambis)
With all of the speculation about the crazy things the owners would do in an uncapped and free market for the players people may want to look at the coaches. The data doesn’t seem to support that adding rules will help competitive balance. Looking at the coaches though it may be that removing rules improves costs.
-Dre (@NerdNumbers)
Wages of Wins Journal 
Russ
October 27, 2011
Dre, I don’t think you are thinking about parity in the right way. Single season parity (equality of outcomes) is clearly very difficult if not impossible. But I doubt any of the owners even want that, as that would imply winning a championship is mostly luck, and most owners think they are clever enough to win via their management skills. What the data shows is that any team can win through a little luck, smart draft picks and attaining superstars, provided they are able to pay well below market value for those superstars. That is still a form of parity (equality of opportunity), and one that the rules maintain by stopping rich owners paying superstars their market value to play in big markets. Ironically, as one of the links on the podcast notes, the ability to accumulate multiple superstars on one team that system affords probably decreases single season parity, and tends to put teams on cycles of winning and losing. Neither of which are a good thing.
gelfnerd
October 27, 2011
Another nice article.
However, you should possibly be discussing this today. Brilliant interview with economist Kevin Murphy.
http://www.nba.com/2011/news/features/steve_aschburner/10/27/lockout-q-and-a-kevin-murphy/index.html
Dre
October 27, 2011
Gelfnerd,
Wow great find! We’ll see if one of us gets around to commenting on it. Also, I notice you’re just starting up your WordPress blog. You could start it off with a great post on this!
fricktho
October 27, 2011
It would be more interesting to see coaches treated like players, as in coaches count against and have to fit under the salary cap, and their contract falls under the same CBA as the players’. If you’re over the cap you can only sign a low tier assistant coach if your present coach signs elsewhere, but you can promote assistants under some exception, etc.
Dre
October 27, 2011
Fricktho,
Question is why do that? Coach prices and terms have dropped. Player prices have stayed constant. If the NBA owners want proof that salary control can happen they should look at what they did with coaches and do it with the players as well.
fricktho
October 27, 2011
Dre,
But we already know that coaches don’t matter all that much, at least that’s the theme around these parts. They decide who plays and who doesn’t, but I imagine most coaches, good or bad in terms of public perception, would tend to play good players more than bad players. Also you can’t discount management influence on coaching decisions in some instances. So are teams coming to this realization? Is that why coaching prices are falling? Is it because they are actually losing money and don’t want to invest in high priced coaches? Is it because they realize that paying a coach top dollar to coach a bad roster makes little sense? It could be a parity issue wherein teams that know they aren’t going to be contenders don’t bother trying to improve their chances by going after big name coaches.
I just said it would be interesting. If you want Phil Jackson then you have to sacrifice salary that would go to the players. If a team thinks a coach can have that kind of impact.
I’m not sold that teams would control player costs in a similar market. They don’t HAVE to spend the money they do as it is. Also as good coaches like Phil Jackson, Larry Brown, Jerry Sloan, etc retire teams have to go find the next diamond in the rough. The amount of coaches with successful and storied coaching careers in the NBA is dwindling.