Contracts

The Increasing Value of the Reliever

If you have tuned into an MLB playoff game the last two seasons, you have probably noticed the painstakingly drawn out pace of the contests. As managers increasingly integrate advanced statistics into their decision making by trying to take advantage of every possible platoon split, having a deep and effective bullpen has become all the more important. While this has slowed some games down to a screeching halt, the reluctance of the players union to agree to proposed pace-of-play changes means that this trend will only continue (and probably become worse). This means more commercial breaks for viewers, but the consequences of this league-wide shift have far more meaningful implications for how teams are approaching the free agent market.

From 2011 – 2015, the amount of money teams spent on free agent starting pitchers in the free agent market was far higher than any other positional group. Elite starting pitchers were, and still are, the most sought-after commodity in the game. They throw more innings than relievers and ultimately have a bigger impact on the game. However, as relievers throw more innings than ever before (a record 38.1% of all innings in 2017), teams have shifted their attention and financial resources to bolster their bullpens. So much so that this offseason, teams have spent 321 million dollars spent on just 24 relievers, compared to just 94.8 million on nine starting pitchers.

This increased spending on relievers started during the 2016 offseason when the record contract for a relief pitcher was set not once, but twice. Early in the offseason, Mark Melancon became the highest paid reliever in MLB history when he inked a four year, 62 million dollar deal with the San Francisco Giants. Later in the offseason, the Dodgers signed Kenley Jansen to a five year, 80 million dollar contract which was followed by the Yankees record-setting 5 years, 86 million dollar signing of Aroldis Chapman. This is all to say as teams continue to lean heavier on their bullpens, they understandably have decided to spend more money on relievers.

While there has never been a better time to be a reliever, they are still receiving considerably less money than starters, despite their growing importance.

In the 2017 MLB season, teams spent 43, 824 dollars for every inning thrown by a starting pitcher, but just 35,433 for every inning thrown by a reliever. While the fact remains that many relievers are just former starters that couldn’t cut it, relievers throw higher leverage innings than starters. If an inning thrown by a reliever, on average, is more important than the average inning thrown by a starting pitcher, it would make sense that these innings would cost more. Instead, they cost less, and teams have begun to capitalize on this market inefficiency.

It is not only the cost per inning that is lower for relievers but also the length of their contracts. This makes sense given that the year-to-year performance is much more volatile for relief pitchers than it is for starters, but this relative volatility is made up for by the fact that relievers are better on a per inning basis.

In 2017, relievers posted a 4.15 ERA with a 23.3 K% compared to a 4.49 ERA and a 20.6 K% from starters. I am not saying that relievers are better pitchers (if they were they would probably be starting), as these numbers are largely the product of relievers being able to throw with maximum effort to hitters that they have a statistical advantage over, both of which are luxuries not afforded to starting pitchers. With that said, the more effective relievers a team carries, the more favorable matchups they can create throughout the game. Teams are starting to realize this and adjust accordingly.

While the trend in increased usage for relievers can be mostly explained statistically, there are other factors at work here as well. From an economic perspective, it makes sense that the more money teams pay pitchers in general, the more they have an incentive to protect their investments.

Since starting pitchers throw more innings and make more money than relievers, teams have an interest in protecting their highest priced arms by more closely regulating their usage. This means shorter outings, more rest days, and ultimately more innings thrown by relievers.

In addition, less statistically-inclined managers used to keep a starting pitcher in the game longer just to help him earn a win, ignoring the arbitrariness of this type of pitch management. The modern manager, however, understands that pitching changes should be based off winning games rather than pandering to archaic statistics.

Overall, teams are buying up relievers like never before because they still hold a relative value on a per inning basis when compared to starting pitchers. While the relative value of relievers will diminish the more teams dedicate their financial resources to this position group, the unprecedented rush on relievers this offseason shows how teams continue to find creative ways to maximize their precious dollars.

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About Traven Tapson

I am a recent graduate from Claremont McKenna College pursuing a career in baseball operations for an MLB team. I am fascinated by the analytical side of baseball and use this blog as a platform to share my insights and knowledge with those who share my curiosities.
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