Salary Stratosphere

More than 450 players have signed an NBA contract this season.  The prices of those contracts range anywhere from $30 million to $16 thousand.  There are a number of variables that factor into the salary figure a player earns.  Perennial all-stars, such as DeMar DeRozan ($26,540,100) or Anthony Davis ($22,116,750), obviously commands more zeroes in the contract, but that is not to say that there are not professionals out there that are making minimum salaries structure based on the length of the deal (full season, 10-day, rest-of-season).  For example, Derrick Williams of the Cleveland Cavaliers signed a 10-day contract worth $67,007.

There were 465 contracts that STATCAT conducted research on.*  The purpose is to provide insight from two different perspectives: 1) the type of return front office’s should expect when signing a player; and, 2) the level of contribution a player must produce in order to be valued at different salary levels.

The patterns that surfaced when running the numbers on various ranges of salaries related to the distribution of salaries, overall production, and shooting efficiency.

Distribution of Salaries

There are 111 NBA players that earn a salary in the range of $2,000,000 to $4,999,999.  That range contains 111 of the 465 total contracts.  The two that consisted of the smallest group of professionals were the $15,000,000 to 19,999,999 level (29 pros), and the $20,000,000+ level (28 pros).

That discovery is not ground-breaking by any means.  As those top-tier salary guys rightfully covet more money, the salary cap structure creates a system where teams are only allowed to spend a certain amount of money.  Thereby, the more money towards one player means the indirect consequence of less money to other teammates.  More money a team pays its player the remaining pool of cash will be directly affected.  With the 2017-18 salary cap projected to increase nearly $7 million from this current season, there will be even more money at the top funneling toward established superstars.

Overall Production

There was a strong positive correlation between the expensiveness of the salary and the production the player contributed. There was a steady increase in PPG production from salary “stratosphere” to “stratosphere”.  The difference can be seen in the players that earn $1-2 million, as they scored on average 5.2 PPG, in contrast to those players that earn $10-15 million, as they scored 11.4 PPG.

When applying the opposite mentality, the view can be switched from team perspective to player.  If a player were to double his scoring production, then that player could then be in the market for earning 500% to 1500% more than his original contract.

Statistically speaking, the standard deviation for point-per-game production yielded 5.6 points.  This signifies the wide range of production across the league.  The NBA is certainly a superstar-driven league and those that are getting paid the most are producing the most.

Shooting Percentages

The other patterns that were discovered related to shooting efficiency.  There is a strong correlation between FG% and the value of the salaries.  The FG% statistics yielded a correlation of 0.75.  

The players that are signed to contracts worth less than or equal to $500,000 shoot on average 39% from the field.  All other groups of players shot at least five percentage points better.

Across the league, there is no group of players that are rewarded for shooting a high percentage from behind the arc. The standard deviation of 3FG% yielded 1.25, which means the averages are consistent throughout each range of salaries. There is no major sign that one group of players produced a staggeringly higher 3FG% efficiency than any other group.  There are individual players that shoot an extremely efficient clip from long-range, such as Stephen Curry (41%), Allen Crabbe (44%), Otto Porter (44%) and Channing Frye (41%), but efficiency was not enough to raise the overall percentage in their respective “salary stratosphere.”

Although each respective salary range yields a relatively similar average, the NBA’s collective 3FG% is 35.8%.  As the league continues to trend toward valuing the 3-point shots over mid-range shots, the question is will the trend promote an increased percentage from downtown?

*All statistics and player contracts were compiled for research during the 2017 NBA All-Star break.
** All statistics and player contract salaries from Basketball Reference