By now, the public ritual is well-worn: Before an array of cameras and reporters, the newly-signed free agent sits on a dais with his team’s general manager and skipper. The club officials gush over the player’s special talents and makeup. The player stresses that this is where he feels he can win.
With camera shutters clicking, a uniform and hat slip on over the player’s dress clothes and new haircut. After taking questions from the assembled media, the ritual concludes and eventually the player adjourns with his family and agent to celebrate a windfall that should set his great-grandchildren for life.
While the press conferences look the same, the amount of money clubs have spent this offseason is new. With two months remaining before the first spring training games, clubs have already guaranteed roughly $3.4 billion to just 77 free agents this winter, per Spotrac, up from $3.2 billion to 147 players in 2021-22 and $1.4 billion to 143 players after the pandemic-shortened 2020 season.
Nine players have signed contracts with nine-figure guarantees, and while those have garnered the most headlines, multiple club executives said they also have been surprised by the activity at lower ends of the market, such as for back-end starters or pitchers coming off major arm injuries. One executive said that entering the offseason, their organization had projected contract figures they thought would get deals done with various free agent targets. But they quickly had to adjust those numbers upward as they saw the market play out.
There’s no single rationale that explains the bigger contracts free agents are landing this offseason. Instead, a confluence of factors has emerged to create the conditions we’ve seen so far.
More certainty equals more money
In many ways, this year’s free agent market has unleashed three years of pent-up demand. The shadow of Covid hung over the entire 2020 offseason. MLB had just completed a 60-game regular season played in empty ballparks. Clubs had to secure loans to cover the unexpected revenue shortfalls caused by playing a season without fans. And coronavirus vaccines were not yet available, leaving open the question of how long the pandemic would continue to affect their businesses.
Last offseason, labor uncertainty caused clubs to be cautious. At this time last winter, the league and players’ union were a month into a lockout that would last until a new Collective Bargaining Agreement was ratified on March 10. Pre-lockout,…