It Might Only Get Worse For The NBA’s Middle Class Moving Forward

Eleven-year NBA veteran Austin Rivers made waves this offseason when he bemoaned how the league’s new collective bargaining agreement squeezed the middle class of players.

“Our CBA deal that we just signed, and I don’t even wanna get heavy into that, that thing is, don’t even get me f—king started on that deal that we got going because it’s top-heavy,” Rivers said. “That’s why we’re seeing all these teams right now, you either make $50 million or $2 [million]. It’s the most lopsided contract, teams, it’s a joke, bro. I can’t tell you how many mid-level guys are signing for the vet minimum around the NBA.”

Kelly Oubre Jr. might be the most notable example of that. With cap space largely dried up across the league, he recently settled for a one-year, minimum-salary contract from the Philadelphia 76ers fresh off averaging a career-high 20.3 points per game with the Charlotte Hornets. A player like him should be earning an eight-figure annual salary, not the $2.9 million that he’ll earn as an eight-year veteran on a min deal.

In early August, ESPN’s Bobby Marks debunked the notion that the new CBA had completely wiped out the middle class. This upcoming season, 99 players are earning between 5 and 9.9% of the salary cap. That’s more than last year (66), the 2021-22 season (78) and the 2020-21 campaign (77).

Still, it’s worth noting how many teams didn’t use the full array of salary-cap exceptions at their disposal this offseason—and why that number might go up next year and beyond.

Only 11 teams dipped into whichever variation of mid-level exception was available to them, and only three—the Cleveland Cavaliers (Ty Jerome), Los Angeles Lakers (Taurean Prince) and Toronto Raptors (Jalen McDaniels)—used their bi-annual exception, according to Salary Swish. A majority of the teams that did use their MLE didn’t even spend the full value (from $5 million for the taxpayer MLE to $12.4 million to the non-taxpayer MLE).

Free agents such as Oubre and Christian Wood, who averaged 16.6 points and 7.3 rebounds per game with the Dallas Mavericks last season before settling on a one-year, minimum-salary contract with the Lakers, must be dismayed at how many teams didn’t use part or all of their MLE. Rivers is correct that neither one of them should be having to settle for a vet-min deal based on their recent production.

Unfortunately for the NBA’s middle class, the new CBA might only exacerbate the problem. Starting in the 2024-25 season, teams can use the non-taxpayer MLE, room MLE and/or bi-annual exception to acquire a player in a trade or via waivers. Teams won’t be allowed to aggregate these exceptions—i.e., a team couldn’t acquire a $15 million player by combining the non-taxpayer MLE and bi-annual exception—but some teams might prefer keeping that $12 million trade exception in their back pocket rather than spending it in free agency.

The new second-apron penalties may impact teams’ willingness to spend their MLEs, too. Beginning next summer, teams roughly $18-19 million over the luxury-tax threshold won’t be allowed to aggregate contracts in trades, can’t take back more salary than they send out in trades and can’t trade first-round picks seven years in the future, among other things.

The new CBA did lower the rates in the first two tax brackets, perhaps to incentivize teams to be more willing to cross the tax line. However, a handful of teams already made moves this offseason to dump either short- or long-term salary from their books.

In June, the Los Angeles Clippers waived Eric Gordon, whose $20.9 million salary was fully nonguaranteed, to trim their tax bill by roughly $110 million, per ESPN’s Bobby Marks. Gordon wound up signing a one-year, $3.2 million contract with the Phoenix Suns in free agency, which is the most they could have offered him. Since they projected to be over the second apron, they didn’t have access to the $5 million taxpayer MLE.

Split between the Houston Rockets and Los Angeles Clippers last season, Gordon averaged 12.4 points and 1.9 three-pointers in only 28.5 minutes per game. He’s no longer the Sixth Man of the Year that he was in his prime, but he’s not a minimum-contract-esque player, either. Much like Oubre and Wood, market factors worked against him.

The new salary-floor rules could be the saving grace for the NBA’s middle class as a whole. Teams now have to reach the league’s salary floor—90% of that year’s salary cap—by the first day of the regular season. If they don’t, they forfeit their share of any luxury-tax revenue they’d receive from other teams, and they have a phantom cap hold put on their books to bring them up to the floor.

Those rules might have factored into the surprisingly large contracts that the Houston Rockets handed to Dillon Brooks (four years, $86 million), Jeff Green (two years, $16 million) and Jock Landale (four years, $32 million, albeit lightly guaranteed). The Indiana Pacers also splurged to steal Bruce Brown (two years, $45 million) away from the defending champion Denver Nuggets.

Had the old salary-floor rules been in place, some rebuilding teams likely would have carried their cap space over into the regular season to serve as a salary-dump destination. That’s no longer possible, so teams with significant cap space have far more incentive to splurge on free agents in the summer.

These salary-floor rules will push up the floor of what every team winds up spending, but the second-apron rules will constrict how much the most expensive rosters are willing to shell out. Kyrie Irving, Draymond Green and Khris Middleton all signed far-below-max contracts with their respective teams in free agency this offseason. If that becomes a trend moving forward, perhaps some of the savings will trickle down to the NBA’s middle class.

But in all likelihood, a handful of players will reap most of the rewards, while the others’ salaries will plummet. For every Brooks, Landale and Brown, there figures to be an Oubre, Wood and Gordon.

As the salary cap continues to rise, the minimum salary will rise accordingly. Ten years ago, the non-taxpayer MLE was $5.15 million. This year, the minimum salary for a players with 10-plus years of NBA experience is only $2 million less than that. In fact, it’s slightly above the taxpayer MLE from the 2013-14 season ($3.18 million).

Still, the transition from eight- or nine-figure contracts to a seven-figure annual salary is often jarring for players. Thanks to this new CBA, a higher volume of players may need to brace themselves for that in the coming years.

Unless otherwise noted, all stats via NBA.com, PBPStats, Cleaning the Glass or Basketball Reference. All salary information via Spotrac or RealGM. All odds via FanDuel Sportsbook.