How will the cost of living crisis impact professional football?

The ongoing cost of living crisis shows no signs of easing, with bills and cost of goods continuing to rise exponentially. Question is, how will the crisis impact the business of football?

People across the UK and around the globe are battling with the ongoing pressures invoked by the cost of living crisis. 

With many struggling to pay their household bills, football clubs have to prepare for a possible impact, according to Dr Mike Reynolds - a Teaching Fellow in Economics at Leeds University.

Clubs could be forced to reduce wages, player transfers will not be as widespread and media companies could see a sharp decrease in their subscription numbers.

When asked about the possible impact on clubs, Reynolds told Planet Sport: "Looking at spending, it will be interesting to see what people prioritise.

"It's going to be hard to work out how that's going to impact football. Will prices go up, will people cut back and stop spending on football clubs? In terms of Premier League clubs, how much do they really rely on that little bit of spending around the edges?

"You've got the big media deals with Sky Sports and those things. If this [cost of living crisis] goes on for too long, then you might see a cut back in people buying Sky Sports. Then, is the next Premier League deal going to be worth as much money as before?

"TV broadcasting money could start to be affected if people stop buying Sky Sports and Amazon, BT Sport, all those things. It's quite complicated to navigate.

"If you want access to all the Premier League games, then you have to buy Sky, you have to buy Amazon, BT Sport. It's really costly buying all three. I would kind of think, the governance of the game needs to think about those deals a little bit more closely."

With inflation continuing to rise and the price of oil and gas skyrocketing, many financial experts are predicting the first recession in the UK since 2008.

In the 2009/10 campaign - the first full season since the 2008 financial crisis - transfer expenditure in the Premier League alone fell from £771million to £534million.

Since then that number has exploded, with a total of £1.5billion spent on players in 2021/22. Interestingly, 124 fewer players were purchased compared to the 09/10 season.

Should the UK face another recession, Reynolds expects clubs to be a lot more careful with their spending, saying: "If you have a recession, it will get clubs to second guess where they spend money.

"I don't think we've ever really seen the transfer market overly affected by recession as such. Even the financial crisis, the top end Premier League clubs - they were ok.

"But the bottom end, the smaller clubs are the ones who struggled. And I sometimes think that it's the smaller clubs and non-league clubs, spending in the community, it would be them that I'm worried about rather than the big clubs.

A Leeds United mural painted on the side of houses in Tilbury Mount in Holbeck

In the event of a financial crisis, Reynolds does expect Premier League clubs to manage, adding: "If you look at big firms generally, when a financial crisis comes along, they're able to weather that storm.

"They will be impacted but they'll have reserves, they'll have a reputation which allows them to borrow money, and they will be able to see out crisis's for the most part. It's the smaller companies, and the smaller football clubs who struggle a little bit more really in those times. You do hear of smaller clubs going bust."

Reynolds hopes clubs, especially those in the top tier, take better care of their fans during a difficult period for the population.

When asked whether football was in a safe state, he added: "I think you'll probably see it safe, but that doesn't mean I don't worry about the people involved.

"I think top flight football will find itself fairly insulated from everyday life, and the pressures of everyday life. You still have to worry about those fans but you do hope you've got football clubs who think about those fans.

"We need to make sure we look after fans a little bit better in this country and not just always see them as a source of revenue. They're the lifeblood of the clubs. Look after fans and be careful rising prices.

"Football clubs could take a good lead saying we will freeze ticket prices, we won't put prices up because you're important to us and we know you're going through tough times."

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