Cost Of Living And How It Will Affect The Upcoming NFL Free Agency

Today I am going to share with you an article submitted to me by a friend of mine named John McAdams. He brings up a very interesting thought here that you never hear mentioned, but it can have a profound impact on how much money a player will make in different cities.

This is a good thing for the Miami Dolphins and a bad thing for the New York Jets, but it is not mentioned enough, so I thought I would bring it up to you guys and see what you thought about it.

Here is what he sent to me:

Simple Sports Economics-101


cost of living n. The average cost of the basic necessities of life, such as food, shelter, and clothing in a specific locale.

Before we begin this year’s Free Agency in the NFL, it would be very good to review some very simple facts that are completely ignored by the entire professional sports community. When various players are traded or acquired and change the teams and, consequently, locations where they work and live, we only hear the terms "how much" and "how long". The second most important consideration of the entire transaction is completely ignored; that is where a player is currently working and their future workplace and home.

To illustrate the significance of cost of living (COL) and why it is so extremely important, an example of a NFL player moving is provided, however the circumstances are exactly the same in all professional team sports.

A New Orleans FA player is sought by the New York Jets, the Miami Dolphins, and his current team. The Saints have offered $5,000,000 to keep him, the Dolphins have offered $6,700,000 for his services and the Jets have offered $8,000,000.

If the locations are thought about like they normally are on TV the professional athlete is skating on very thin, dangerous ice. Let’s do a little tiny bit of cost of living analysis.

If you are working for a company in Nebraska and they send you to live in Hong Kong, they would have to pay you almost 3 times your Nebraska wages, in order for you to live as you did in Nebraska. Similarly, the cost of living varies throughout the U.S. and each state is as different in the value of a dollar as different countries.

Our New Orleans player has the three offers ($5 million in New Orleans, $6.7 million in Miami, and $8 million in New York); let’s examine each offer using cost of living. If he stays in New Orleans, he knows what things cost and he’s grown into a lifestyle compatible with his income.

Let’s see what happens if he moves to New York. Among all the wonderful things about Gotham, one thing isn’t so wonderful: New York City is one of the most expensive areas to live in the U.S. The city itself even has a city income tax! Because of taxes and other hard and fast costs, New York City has an EF (Equivalency Factor) of 2.38.

In order for our Saint’s player to have an equivalent standard of living that he had in New Orleans and be with the Jets, he would have to be paid $10,217,859.

The third team in the mix, the Dolphins, has offered $6.7 million and since Miami has an EF of .99, there is essentially a $1.8 million dollar raise over the New Orleans offer since the cost of living is almost the same in Miami and New Orleans. So unless our fictional Saint’s player wants to take a massive pay cut and live in New York City, he would be wise to stay where he is or take the Miami offer.

Every professional athlete should strongly examine the cost of living and the EF (Equivalency Factor) when considering any career move. Stay tuned, cost of living, the Equivalency Factor, how it is calculated, and individual NFL cities cost of living factors will all be covered in future articles in this series.

Thanks for stopping by. I hope you enjoyed this look at the incredible differences in the Cost of Living in different cities.

If you would like to contact John, shoot him an email at I'm sure he would love your feedback.

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