Demo-economic analysis of player transfers (2014-2023)

1. Introduction

This Monthly Report analyses the financial flows of football transfers on a global scale during the decade between 2014 and 2023. It presents the evolution of transfer fees incurred by clubs, their breakdown according to the age and position of the players concerned or the geographical area of recruiting teams, as well as the economic balance sheets of transfer operations, at both league and club level.

The figures published include fixed transfer fees, any add-ons regardless of whether they have actually been paid, as well as sums paid in the context of paying loans. Amounts negotiated for loans with an obligation to buy are included in the breakdown for the year of the transfer. Within the limits of available information, the data on beneficiaries considers sell-on fees negotiated by previous clubs.

2. Investments worldwide

The year 2023 was a record-breaking one. For the first time in history, worldwide investment in transfer indemnities exceeded the €10 billion mark. While the transfer period is not yet over in all associations, spending has already reached €12.4 billion, a sum that is 33% higher than that recorded in 2022 (+35% not including add-ons) and 24% higher than the previous record set in 2019 (+20% without add-ons).

Almost three-quarters of the investments were for transfers between clubs in different associations. This rate was only around two-thirds in the period between 2014 and 2022, reflecting a dual trend: an increase in the relative share of international transfers among paying fee transactions (around 63% in 2023 compared with 58% between 2014 and 2022) and an increase in the gap between the median level of indemnities (ratio of 1.52 between international and domestic transfers in 2023 versus 1.33 during the 2014-2022 period).

In a context short on transparency, these figures represent estimates that are as close as possible to reality. They are based on official data published by FIFA TMS for international transfers and the CIES Football Observatory's own research. The sums of paid transfers for which no figures have been published have been extrapolated using a property statistical model estimating the value of professional football players.

This chapter includes a correction that has been applied to the amounts for national transfers on the basis of an annual ratio calculated by comparing the FIFA TMS figures with those collected by the CIES Football Observatory on an international scale (on average 1.08 over the entire period, with a reduction in the differences over the years). For 2023, the correction is based on the ratio measured in 2022, i.e. 1.06.

The hierarchy of transfer fees by national associations shows the key role played by England in the global market for footballers. Over the last decade, English clubs have committed no less than €25.36 billion: 32% of global investment and 2.3 times more than teams from the second most active country, Italy. The latter is the only association in the top ten whose clubs have invested almost as much nationally as internationally.

Despite the sharp fall in investments from 2018 and especially since 2020, China remains the non-European association whose clubs have invested the most on transfer indemnities over the last decade, ahead of Saudi Arabia, a country that has seen the opposite trend to China, Mexico, where the proportion of sums invested nationally is also considerable, Brazil and the United States, where football is constantly growing.

English clubs also invested by far the most on the transfer market in 2023: 32% of the total and 3.5 times more than teams from the second most active association, France. In absolute terms, two countries stand out in terms of the increase in spending between 2022 and 2023: England (+€1,314 million) and Saudi Arabia (+€902 million). In relative terms, however, Saudi Arabia stands out clearly, reflecting the plan to make the Saudi Pro League one of the most competitive leagues in the world.

3. Breakdown of investments

Clubs are increasingly prone to spend transfer fees on young players. The proportion of money invested in footballers aged 21 or under has risen from 23.6% in the period between 2014 and the last transfer window before the pandemic to 26.9% after the health crisis, with a peak of 29.6% in 2023. The percentage of investment for players aged between 22 and 25 has also increased (+3.3%), while that for footballers aged between 26 and 29 has fallen sharply (-7.0%).

The analysis by position shows that forwards are still the players for whom clubs invest the most. However, a fall in the relative share of sums committed for footballers in this position was observed after the health crisis (-3.7%), to the benefit of defenders (+1.2% for centre-backs and +0.3% for full-backs) and midfielders (+2.1%). This finding shows a greater inclusion of all positions in the trading of players.

The study of the evolution of the sums invested according to the geographical zone of recruiting clubs reveals that the health crisis went hand in hand with the reinforcement of the domination of English Premier League clubs: from 25.3% of global spending until the pandemic to 34.2% afterwards. Most of this increase has come at the expense of the other leagues in Europe's big five (-9.7%).

4. Net transfer spending per league

The analysis of the net spending by league for transfers carried out over the last decade once again reveals the importance of the English top flight in the global football market. Premier League clubs have the most negative balance sheets, with investments in excess of €20 billion, only half of which is offset by revenues, resulting in a net deficit of more than €10 billion. This is a negative balance that is out of all proportion to that measured for any other league.

In contrast to the English Premier League, the Portuguese Primeira Liga has the best net balance on transfer deals concluded over the last decade: +€2.23 billion. Although this balance needs to be put into perspective, given that commissions paid to agents are not included in the calculations, it does reflect the ability of teams in Portugal to generate transfer revenues. The Brazilian Serie A is the second league whose clubs have made the highest net transfer profit over the last ten years, just ahead of the Dutch Eredivisie.

England's second tier heads the rankings in terms of balance sheets for 2023 transfers only, with a profit of +€348 million. This balance is due in particular to high-paying transfers of players from clubs recently relegated from the Premier League. The Championship is ahead of Portugal's top flight (+298M) and Italy's Serie A (+€227M), where clubs are increasingly dependent on transfer revenues. At the other end of the scale is the Premier League (-€2.20 billion), ahead of Saudi Arabia (-€861 million).

5. Net transfer spending per club

With €2.64 billion invested over the last decade, including more than a billion since its takeover by an American consortium just before the 2022 summer transfer window, Chelsea FC is the club that has committed the most money in transfer fees. Despite having invested "only" €1.96 billion, Manchester United has by far the most negative balance (-€1.40 billion), ahead of Chelsea (-€1.03 billion) and Paris St-Germain (-€1.01 billion). For 2023 alone, the biggest deficits were made by Chelsea (-€557 million), Al-Hilal (-€341M) and Arsenal (-€217M).

Three Portuguese clubs feature in the top six of teams with the highest net transfer profits over the last ten years: Benfica (clearly first, +€764 million), Sporting CP (fifth, +€376 M) and Porto (sixth, +€352 M), while Ajax, Monaco and RB Salzburg complete the top five. For 2023 only, the top three are Villarreal (+€129 million), Benfica (+€114 M) and Stade Rennais (+€103 M).

6. Conclusion

Following on from the increase recorded in 2022, after two years of consecutive decreases in the context of the health crisis, 2023 marked a new turning point in the money invested by clubs on the transfer market. Boosted in particular by the economic growth of the English Premier League and investment from American and Saudi funds, the transfer market reached historically high levels: €12.42 billion compared with €9.98 billion in the previous record year of 2019.

The trends observed in connection with the pandemic were confirmed and even reinforced in 2023, with relatively more money invested by Premier League clubs (34% of the total since summer 2020 compared with 25% previously) and on players aged 25 or under (74% compared with 67% previously). The latter trend reflects the fact that a growing number of clubs are incorporating the realisation of capital gains on transfers into their business model, including in previously dominant leagues such as the Spanish Liga and the Italian Serie A.

The football transfer market is becoming increasingly structured around a small number of "buying" clubs, led by the English Premier League, and a much larger number of "selling" ones. The latter are targeting their recruitment at up-and-coming players, who they are likely to quickly transfer if they perform well, in a highly speculative environment involving ever-increasing and intense player mobility on a global scale.