Analysis: Implementing a salary cap in the Championship? Data shows wages have little meaning for league placement

15 September 2020

Photo: PA Images "If you have your house in order, ideally that you are profitable, that may play a part following promotion. You are likely going to have more sustainable resources to invest in the playing squad to get things up to Premier League standards than you would have if you had been massively loss-making," says Christopher Winn.

Championship clubs are reportedly discussing whether to implement an £18 million annual wage cap – analyses its implications.

There is little correlation between wage spend and league placement in England's second division, a stark contrast to the situation in the Premier League.

Despite that, a financial expert does not expect promoted clubs to struggle as a result of a presumably larger wage gap.

Not a single club who made the jump to the Premier League since 2010 recorded an operating profit in the year they were promoted.

Emil Gjerding Nielson and Joseph Mailil, analyst

League One has implemented a wage cap. League Two has implemented a wage cap. The EFL is facing a £200 million hole as a result of the coronavirus pandemic, and clubs need to "reset" their business models, according to chairman Rick Parry. 

But the Championship kicked off last weekend and things are eerily similar as to how they have always been. Implementing an £18 million wage cap has reportedly been discussed but agreement has yet to be found among clubs in England's second tier.

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