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GIG BASEBALL'S ECONOMY

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UNSIGNED ALL-STARS, CRATERING SALARIES, A SYSTEM THAT FAVORS PART-TIME WORK: A NEW PARADIGM HAS COME TO BASEBALL, AND IT IS NOT GOOD NEWS FOR PLAYERS

THE DODGERS are the Uber of baseball. They have disrupted traditional full-time work with job sharing among enough players to fill two teams.

Los Angeles has won two consecutive National League pennants without any player starting 140 games at one position or pitching more than 175 innings. They have used at least 52 players in all four seasons under president Andrew Friedman, after doing so just twice in the previous 125 years.

But L.A. is far from alone in its disruption. It just happens to be the most artful of the many teams creating a boom in baseball that echoes the current business world: the gig economy.

A gig economy upends the traditional labor paradigm in favor of short-term work and independent contractors. Data from the Federal Reserve last summer found that nearly one out of every three adults engaged in gig work, either as a primary or secondary source of income. Think Uber drivers, temp workers, delivery drivers, baristas, freelancers and now major league baseball players. "Not too many teams run the same eight, nine guys out there every day," says Brewers president David Stearns. "We are getting better as an industry at preparing for the unforeseen happenstance. Really smart clubs 10 to 15 years ago recognized it. Now the industry is recognizing it."

The upshot of a gig economy for players is familiar to American workers: more jobs, but the work often is part-time and the pay is declining. A record 1,271 players appeared in major league games last year. That's a 15.8% increase in jobs since 1998, the first season with 30 teams. Yet the average salary went down last year for the first time since 2004—while revenues again went up.

Welcome to the age of what one executive calls "the puzzle-piecing of the roster," where analytics-savvy general managers play a game of arbitrage with players. Baseball's gig economy is good for players on the margins, such as relief pitchers, utility players and young players with minor league options (who allow roster flexibility)—all at least get a foot in the door. It is good for analytics departments, who continue to gain organizational power, especially over managers. It is not good for the veteran player.

Just ask DJ LeMahieu, Jed Lowrie and Brian Dozier, all former All-Star second basemen who hit free agency this winter. All of them signed for less guaranteed money than past free-agent second basemen Omar Infante and Luis Castillo (chart, below). Tellingly, none were signed with the promise Infante and Castillo received: to be everyday second basemen for multiple years. LeMahieu (two years, $24 million with the Yankees) and Lowrie (two years, $20 million with the Mets) were told to prepare to play multiple positions. Dozier signed a one-year, $9 million deal with the Nationals.

With all this job sharing, it should be no surprise that the free-agent market is a sluggish one for the second straight winter. The gig economy is bad for free agents, who tend to be older and more expensive, because analytics prefer younger players and job-sharing arrangements. Players don't have to like this gig economy, but they better get used to it, at least until they address issues in the next collective bargaining agreement. (The current one expires on Dec. 1, 2021.) The gig economy isn't going anywhere in the short term, not as teams such as the Dodgers succeed with it. In four seasons under Friedman since 2015, L.A. cut payroll by $100 million while using 214 players, only three of whom started 140 games at one position. Meanwhile, L.A. has signed none of the 17 free agents who signed for more than $80 million in those years.

The results are hard to argue with: In those four seasons L.A. won the NL West every year, led the majors in attendance and were second to the Cubs in wins. In baseball's new gig economy, the Dodgers are getting five-star ratings.

WORKERS' COMP

PLAYERS 33+ WITH 125 GS

IN 2002, at the height of the Steroid Era, 34 players age 33 and older started at least 125 games, a modest number of starts for a regular. Only nine such players were given that kind of workload last year—a 74% decline in 16 years. Only two of those players found regular work in the NL: Nick Markakis, an All-Star who re-signed with the Braves for a one-year deal at $6 million, and Joey Votto. Overall, starts by players 33+ suffered a whopping one-year decline last year of 41%, hitting their lowest level in the 21 seasons with 30 teams. So much for modern medicine and training extending careers.

[The following text appears within a diagram. Please see hardcopy or PDF for actual diagram.]

35

30

25

20

15

10

5

0

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

CF

1978

BILLY NORTH

82 games

2018

CODY BELLINGER

50 games

LF

1978

DUSTY BAKER

142 games

2018

MATT KEMP

69 games

SS

1978

BILL RUSSELL

151 games

2018

CHRIS TAYLOR

73 games

2B

1978

DAVEY LOPES

143 games

2018

BRIAN DOZIER

40 games

1B

1978

STEVE GARVEY

161 games

2018

CODY BELLINGER

85 games

3B

1978

RON CEY

158 games

2018

JUSTIN TURNER

90 games

C

1978

STEVE YEAGER

72 games

2018

YASMANI GRANDAL

110 games

RF

1978

REGGIE SMITH

121 games

2018

YASIEL PUIG

107 games

LA LA LAND

The set lineup is dying. The 2018 Dodgers won the pennant without any player starting more than 110 games at one position. Forty years earlier, the Dodgers won the pennant with six players starting more than 110 games at one position.

W IS FOR WANING

The marquee starting pitcher is endangered. As starters throw fewer innings, they accumulate fewer wins, and fewer wins means less prestige. As recently as 2012 starting pitchers accounted for 71.5% of all wins. Last year that percentage dropped to 62.3, an all-time low.

[The following text appears within a diagram. Please see hardcopy or PDF for actual diagram.]

1800

1600

1400

1200

1000

800

2012

2013

2014

2015

2016

2017

2018

2019

▪: STARTING PITCHERS

▪: RELIEF PITCHERS

SECOND LIVES

This winter, former All-Star second basemen DJ LeMahieu, Jed Lowrie and Brian Dozier all signed deals significantly less than previous players at their position

[The following text appears within a chart. Please see hardcopy or PDF for actual chart.]

1YR

2YR

3YR

4YR

5YR

2018

BRIAN DOZIER

AGE 31

WAR 1.0

OPS+ 88

CONTRACT YEARS

$9 MILLION

1YR

2YR

3YR

4YR

5YR

2018

JED LOWRIE

AGE 34

WAR 4.8

OPS+ 120

CONTRACT YEARS

$20 MILLION

1YR

2YR

3YR

4YR

5YR

2018

DJ LEMAHIEU

AGE 30

WAR 3.0

OPS 88

CONTRACT YEARS

$24 MILLION

1YR

2YR

3YR

4YR

5YR

2013

OMAR INFANTE

AGE 31

WAR 2.5

OPS+ 115

CONTRACT YEARS

$32.3 MILLION

1YR

2YR

3YR

4YR

5YR

2007

LUIS CASTILLO

AGE 31

WAR 2.8

OPS+ 94

CONTRACT YEARS

$29.9 MILLION

*Contract year stats

PEAK CONCERNS

THE AGING CURVE

THE DROPOFF last year in total starts by veteran players was stunning. Players age 33 and older started fewer games last year than they did even in 1982, when there were four fewer teams and 9,720 fewer possible starts. Let that sink in: Older players are less useful now than at any point in at least a generation.

58% decrease in games by players age 33+ since 2006

Think about that when you think about free agents Bryce Harper or Manny Machado signing contracts beyond seven years or paying anyone elite dollars at 33 and older. Players past their 33rd birthday are having a hard time finding jobs, including outfielders Carlos Gómez, Carlos González, Adam Jones, Melky Cabrera and Hunter Pence.

21% increase in games by players 25 and younger since 2006

MARKET CORRECTION

Three years ago teams shelled out big for "innings eaters" Jordan Zimmermann and Wei-Yin Chen. Both were busts. Teams no longer value workhorses in the same way, as Lance Lynn and and Dallas Keuchel have found out.

[The following text appears within a chart. Please see hardcopy or PDF for actual chart.]

1YR

CONTRACT YEARS

2YR

3YR

4YR

5YR

DALLAS KEUCHEL

AGE 31

W-L 76--63

ERA+ 108

FIP 3.72

UNSIGNED THROUGH FEB. 1*

1YR

2YR

3YR

4YR

5YR

LANCE LYNN

AGE 31

W-L 82--57

ERA+ 110

FIP 3.67

CONTRACT YEARS

$30 MILLION

1YR

2YR

3YR

4YR

5YR

WEI-YIN CHEN

AGE 29

W-L 46--32

ERA+ 110

FIP 4.14

CONTRACT YEARS

$80 MILLION

1YR

2YR

3YR

4YR

5YR

JORDAN ZIMMERMANN

AGE 29

W-L 70--50

ERA+ 118

FIP 3.40

CONTRACT YEARS

$110 MILLION

*Career stats through contract year

RELIEVERS ON PARADE

MLB has set a record for most relief appearances for four consecutive seasons. From 1998 through 2018 relief appearances have increased by 37%, from 4.9 per game to 6.7 per game.

37% SINCE 1998

Most Relief Appearances

1. 2018: 16,340

2. 2017: 15,657

3. 2016: 15,306

4. 2015: 15,108

5. 2012: 14,523

WHY HAS THE GIG ECONOMY TAKEN OFF?

1 INCREASED SUPPLY

The talent pool is growing, thanks to improved training on both amateur and professional levels. "In creating supply, the industry is a little better at scouting and definitely better at development," says a top executive.

2 ADVANCED ANALYTICS

The purpose of advanced analytics is to seek any incremental edge, which often means job sharing in the form of platoons, matchups and "super utility" players.

3 SPECIALIZED PITCHING

Pitching changes per game are up 37% in the same period (4.9 to 6.7). With all those relievers, nowhere is the gig economy more obvious than in starting pitching. Work for starters continues to decline so much that the Rays started a growing trend by using an "opener," a matchup reliever to start the game.

4 BIAS AGAINST OLDER PLAYERS

Baseball teams have lost confidence in players in their mid-30s to be everyday contributors. It started with testing for PEDs (2003), continued with the banning of amphetamines (2006), and has accelerated in the past five years as pitch velocity and spin have increased, a trend that favors younger players.

5 GROUPTHINK

Teams essentially operate with the same set of numbers, and trust in those numbers is uniform and thorough. Oakland A's president Billy Beane joked years ago that decision makers had become actuaries. "What we're seeing now is what started out as small market principles being applied by big-market teams," said one club official.