New York Islanders Salary Cap, Wage Inflation, and Learning From NBA

At the end of this season, the New York Islanders will have a number of free agents that are going to need new deals. Thankfully the salary cap might go up by a record amount. But we should look at the NBA to know salaries will skyrocket with all this new money.

Last night I wrote a piece about how the New York Islanders were given a lifeline by the NHL thanks to a reported increase in NHL revenues. You can read it here.

According to league commissioner Gary Bettman, the league will likely see revenues between $4.5 and $5 billion. Which, if true, could potentially bump the NHL salary cap by some $10 million to a ceiling of $82 million.

That’s great. With players like Nikolai Kulemin ($4.1875 million), Jaroslav Halak ($4.5 million), Jason Chimera ($2.25 million) and Dennis Seidenberg ($1.25 million) on deals set to expire and not likely to return, that creates a possible $22 million gap for the Islanders to work with.

That’s an unbelievable amount of space to sign John Tavares, Josh Bailey, Brock Nelson, Calvin de Haan, Thomas Hickey, and Ryan Pulock. It should be more than enough even when you factor in some increases to other players on the roster and whatever players the Islanders have to bring in to fill some hole.

But that’s all assuming the player’s sign deals in a context devoid of massive NHL windfalls. Because like we all saw with the NBA, when the salary cap goes up, so do the salaries.

The NBA Example

Back in 2016, the NBA signed a massive $24 billion TV deal which pushed the salary cap up, way up. By $24 million. It was an unprecedented level of growth for the league. Money was flying everywhere.

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So naturally, when it came to signing free agents that summer just ahead of the 2016-17 NBA season, the money also flew freely. It’s obvious that superstars would get paid. But what happened was everyone got a bump. And not just a bit. By a lot.

According to the National Inflation Association, player salaries skyrocketed across the board. The NIA cut the free agency class into three groups, the top 20 ranked players got average increases of 124.1%, the 21-40 ranked players got average increases 129.8%, and the bottom tier got average raises of 48%.

Players like Timofey Mozgov got raises of almost $12 million per season to $16 million in salary. For a player that’s averaged 6.9 points, five rebounds, and 0.5 assists a game through his eight-year NBA career.

So if we’re to extract this lesson to the NHL, players like Brock Nelson, Josh Bailey, Calvin de Haan, Thomas Hickey and certainly John Tavares are in for bigger paydays than we previously anticipated.

Next: Three Surprises Through First Six Weeks of 2017-18

Do the Islanders have enough cap space to sign all those players with the proposed increase? Yeah. For sure. But if the NHL revenues are as Bettman says they are, then don’t be surprised if Brock Nelson signs for more than you were originally comfortable with.

At the end of this season, the New York Islanders will have a number of free agents that are going to need new deals. Thankfully the salary cap might go up by a record amount. But we should look at the NBA to know salaries will skyrocket with all this new money.

The NBA Example

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