Wednesday, February 22, 2017

Should NHL 1st Round Picks Go To NCAA?

Many talented young hockey players will decide to enroll in American Colleges and play varsity hockey in the NCAA. Some will be drafted to the NHL while they’re in college, while others will be drafted before they go to college.  Many NCAA players drafted by NHL teams will decide to stay at school for the full-term while others will drop out early to turn pro. It can be a very difficult decision for a young man to make.

For middling players like Ned Braden, it makes more sense to stay in school. The less likely you are to make it in the NHL, the more valuable that diploma is to you. When we’re talking about first round picks, their expected career earnings by age 25 is 10.5 Million Dollars. They have a 54% chance of earning a million dollar (or greater) annual salary by age 23. The faster they can get to their 2nd contract, the higher their career earnings will be.

Take the example of two players picked 5th overall, Phil Kessel and Blake Wheeler. Kessel went directly to the NHL and Wheeler went to college and waited 4 years to turn pro. Over the next 8 seasons after being drafted Kessel banked $33.6M in career earnings, but Wheeler over the same span only earned $10.4M. For elite prospects, the Opportunity Cost of getting a College Degree is much higher. If their goal is to maximize career earnings, they should be trying to get out of their entry level contracts as quickly as possible. It’s unlikely that psychology degree is going to make you a multi-millionaire.

For players who don’t get drafted, going to the NCAA is a smart move. There is a greater appetite among NHL General Managers these days for College free agents, certainly more so than for undrafted CHL players (many of whom end up in the CIS). And for the record, the Canadian University hockey league is a graveyard league where careers go to die. Nothing more, nothing less.

If we look at all the first round picks drafted into the NHL who were either playing in or still eligible for the NCAA when drafted (from 2004 to 2011), 98% of them will play at least 1 game of North American professional hockey (NHL, AHL, ECHL). 83% will play at least 1 game in the NCAA. On the 3rd season after being drafted, 34% are still playing NCAA. For all these first round college bound players, 16% play only 1 season of NCAA. 31% play 2 seasons, 24% played 3, 12% play 4 years NCAA.

When 64% of them are leaving college after two years or less (including the ones who played 0), the undeniable conclusion is that the lure of making millions of dollars is drawing the majority out of college before graduation, as it should be. I just wonder about the 1/3 who are staying 3-4 years. To all those first round picks who want to graduate with a Degree, I recommend taking an economics course and pay extra attention when they get to explaining “Opportunity Cost”.

The one instance where it might be beneficial to stay in school and wait it out is if you get drafted by a franchise you don't want to play for. Wait the full term and you can sign with any team you want. I'm looking at all this from the player's perspective.

It's not as advantageous to turn pro early and still get stuck on entry level slide. It's all about getting that countdown started as quickly as possible. It's a judgement call to turn pro at 19, but for sure by 20. It's turning pro at 22 that does the most damage to your bank account.

If we again look at the population of first round picks eligible for or in the NCAA; the players who play 0 or 1 seasons of NCAA hockey average $15M career earnings by age 25. The players who play 3 to 4 seasons of NCAA average $5M career earnings. Some of these guys delaying turning pro until they graduate are costing themselves several million dollars. Was that Bachelor of Arts in History worth the 10 million dollars it cost you?

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