Following on from the data released a couple of weeks ago about Premier League clubs’ financial data, the data from the Championship (England’s second tier) have just been published by the Guardian. These are from 12 months ago (the most recent data available). The Championship is famously very competitive – so it will be interesting to see if the same wages and league position correlation that we see in the Premier League also holds here.
Wage Bill 2012-13 Season (millions of pounds)
Using an online scatter plot program we can get the following graph:
Here the league position is on the x axis and the wage bill is on the y axis. In this case if there was a correlation between wages paid and league position we would expect the slope to be negative (as greater wages would lead to a lower league position). From the graph we can see a pretty weak correlation:
Correlation coefficient (r): -0.3451690473979
Regression line equation: y=24.59-0.43x
The correlation coefficient shows that there is a weak negative correlation.
If we compare this to the scatter graph for the Premier League for the same period (this time the wages are plotted on the y axis – though this will not affect the calculations!)
We can see a stark difference. This time the correlation coefficient is -0.73, which shows a pretty strong negative correlation. So what does this show? Well, it confirms what many people already think about the 2 leagues – the Premier League is overall quite predictable – just by looking at the relative wage bills you can get a pretty good idea about league positions. The Championship on the other hand is really pretty unpredictable – wages seem to have only a weak correlation with league position. Indeed Wolves had one of the highest wage bills and yet finished 2nd from bottom.
Championship Debt Timebomb
This remarkable graphic shows the terrible state of the finances for most Championship clubs. It shows wages as a percentage of turnover. Spending 50% of turnover on wages is generally considered a sustainable model for football clubs – yet every club in the table is above this – and the vast majority are spending 95% or more of their turnover just on wages. Bristol City (who were relegated) were spending a staggering 190% of turnover on wages – i.e nearly twice their total turnover!
This is again quite a contrast to the Premier League, where clubs seem much better run:
Whilst most clubs are spending more than 50% of their turnover, there are only 3 clubs spending more than 90% – and only QPR (who were relegated) spending more than their turnover.
So, the Championship is a much more unpredictable league – but also a financial basketcase.
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