According to The Sport Journal, published by the United States Sports Academy, the NCAA revenues for the 2011-12 fiscal year were projected at $757 million, of which $452.2 went to Division I schools. (Johnson & Acquaviva, 2011). Although the organization makes a huge profit, the NCAA mindset is to contradict itself and to promote their athletes as amateurs, playing simply for a free education and the love of their sport. In one theory, this could make sense as almost all NCAA sports are non-revenue. In fact, football and basketball (mainly men’s) are the only sports capable of turning a profit for the school, and at the Division I level, that expectation is set for the head coaches and athletic directors. A team which can generate high revenue can offset the expenses of all the other teams in the athletic department. Only about 20 schools are capable of achieving this goal. Schools that cannot turn a profit are sometimes forced to drop sports from both their men’s and women’s program in order to maintain their Title IX obligations which demand gender equity in every school’s athletic program.
At face value, offering a full scholarship to the student athlete would appear to be enough compensation, as the average four-year scholarship can range between $30,000 and $200,000 over a four-year period, depending if the institution is public or private (NCES, 2010). Since a university at the Division I level offers hundreds of these scholarships to student athletes every year, the total cost is substantial, potentially reaching well over a million dollars every year. Also, the 2000 U.S. census bureau reported that the lifetime earnings for those with a college degree are over $1 million dollars more than non-graduates (Johnson & Acquaviva, 2011).
Maintaining the balance between acting as either an amateur organization or a big business is hard for the NCAA, as well as its college presidents and athletic directors who run the schools and their sports programs.
Yet there are several strong points to be made when arguing that the full athletic scholarship is not enough compensation for the student-athlete. The first argument stems from the question of the value of the scholarship in comparison to the real costs of attending college. Along with the NCPA study previously mentioned, The Collegiate Athletes Coalition (CAC) estimates that NCAA scholarships are worth about $2,000 less than the cost of attending a university, as it does not account for travel and miscellaneous items (Johnson & Acquaviva, 2011). This leaves a gap of at least $8,000 to come out of pocket during a four-year college stay.
Many athletes seek to make up this compensation in other ways, some of them illegal by the stringent NCAA standards. A 1991 study, which surveyed 3,500 current and retired football players in 1989 found that 31% had received “under the table” during their college career and that 48% knew of others who had received payments.
Another argument supporting financial compensation for college athletes develops from the economic studies which have been done on NCAA sports. Several economists view the NCAA ‘as a cartel that attempts to produce rents, both by limiting payments for inputs such as player compensation and by limiting output” (Kahn, 2007). One study by economist Richard Sheehan, which based college athletics on a 1000 hour per year workload, calculated the basic hourly wage of a college basketball player at $6.82, while a football player made $7.69. On the other hand, the hourly wage of the coach ranged from $250-$647 per hour (Kahn, 2007).
While it is realistic to view a $10,000 to $50,000 yearly scholarship with educational benefits as fair compensation to a college athlete, the view becomes hypocritical when viewed next to the salary of many of the team coaches, as well as the potential and real income earned by some Division I schools.
Solutions brought to the table by NCAA reformers have included the idea of creating a $2,000 annual stipend for each collegiate athlete, as well as allowing the opportunity for college athletes to market themselves to private industry. The first option would most likely favor the schools with the most money, because it is assumed that all athletes, including those in minor sports (archery, water polo, etc.) would also need to be paid. The second option is viable, but unprecedented. Currently, Heisman Trophy Johnny Manziel of Texas A&M is in court trying to win the copyright to his nickname, Johnny Football.
Johnson, D. A. & Acquaviva (2012). Point/counterpoint: paying college athletes. The Sport
Kahn, L. (2007). Markets: Cartel behavior and amateurism in college sports. Journal of
Economic Perspectives, 21(1), 209-226.
Nocera, J. (2011). Let’s start paying college athletes. New York Times Magazine, Dec. 30, 2011.
Wilbon, M. (2011). College athletes deserve to be paid. ESPN Magazine, July 18, 2011