Today’s guest columnist is Professor Rick Burton of Syracuse University.
Is it possible the parents of children playing in the American youth sports ecosystem are suddenly waking up and realizing they’ve unknowingly bred a cash cow? That their child, no matter how young or elite, whether they play in a U13 soccer league or AAU basketball program, can earn incremental family income?
It may sound unlikely, but here’s how: This past summer new state laws went into effect, forcing the NCAA to allow intercollegiate student-athletes to profit off their name, image and likeness (NIL). For years, the NCAA prohibited college-age amateur competitors from making money via side hustles. But as of July 2021, most restrictions were removed, and nearly all U.S. athletes, regardless of age, were suddenly able to activate NIL rights via advertising or endorsements… and without risking their intercollegiate-athletics eligibility.
By default, high school and even grade-school kids who once feared they couldn’t play at an NCAA institution (because they “received” or “earned” improper income), need no longer worry. American scholastic athletes, not restricted by visa limitations or living in Texas or California, are officially on the open market as fresh-faced entrepreneurs.
Is that scenario unlikely? Think again.
All over the U.S., parents and legal guardians are seeing the benefits of little Tara or Taamir earning some cash for the family. And many want in. Regardless of whether they have any real chance of playing in the pros. Why? Because the rules restricting amateurism are largely gone, and money is flooding toward those offering NIL relationships.
The professor in the office next to mine is currently raising a future hockey star who just signed his first social media NIL endorsement at the age of 12. Granted, all he got was a hooded sweatshirt with his name on it, but the family is actively considering how to milk this youngster before he reaches high school. They estimate if he curates his social media following aggressively, he might earn thousands by the time he skates his first scholastic shift.
Few will remember that child labor regulations were formally established via the Fair Labor Standards Act in 1938, ostensibly to keep children from working in sweatshops or dying in coal mines. This was a time when some American families needed their children to help pay for food.
Fewer still may know that in states like California and New York, “Coogan Laws” were put in place to protect the earnings of child entertainers (i.e., Jackie Coogan, later famous as Uncle Fester on TV’s The Addams Family), from the stage parents who pushed them to become famous and then fleeced them of their money while they grew out of their short pants or pinafores.
That era passed long ago, and while contemporary children no longer mow lawns or babysit, there are many monetizing their funny videos on social media, or earning income playing Madden 21 or NBA 2K on Twitch. This generation is already cashing in—as are, we can assume, the doting parents who drive them around. In other words, Malcolm Gladwell’s 10,000-hour rule means some children have developed compensable skill sets.
That brings us to 2021. Athletic children are now potential golden geese. We can put them on the nest and ask them to produce.
Let’s start by agreeing that while the NCAA just green-lit roughly 500,000 small business operators, there are millions of school-age children who can also enter this expanding marketplace.
What if Mo’ne Davis, a pre-teen Little League World Series baseball player who knocked the late Kobe Bryant off the national cover of Sports Illustrated in August 2014, could have immediately leveraged a wide assortment of NIL rights? What if the young woman who became America’s darling, receiving texts from then-First Lady Michelle Obama, could have charged everyone for the privilege of connecting with her? What could she have made via TikTok or Instagram?
As it was, NCAA rules would’ve made Davis ineligible to “earn” a future scholarship. That meant she became the equivalent of a plane landing with empty seats. While the NCAA permitted Davis some limited endorsement deals, as each day passed, she lost baseball-related income she could never recover.
But recognize that the right to earn NIL dollars could be a two-sided coin of possibility and regret. Good if a “baller” can leverage their economic freedom but bad if the young athletes don’t hold up their end of the agreement or get cheated/exploited by greedy adults.
So, how should parents think about leveraging pre-teen children and this NIL reality? The short answer is that a college degree is worth far more than what most children and NCAA athletes can earn from NIL. And placing a child under the pressure of having to earn for the family is, in many ways, unfair. Childhood should be a time of discovery, curiosity and “play.” Not a period of forced labor with the sole goal of supporting others.
The hard truth, though, is that American parents are suddenly looking at their children as monetizable assets. As a sport management professor at Syracuse, that’s scary, because many of those same parents will not teach financial literacy to their child, or sock away earnings in a protected trust fund. Or grasp just how quickly their children’s names, images and likenesses will become meaningless.
Said another way, if pre-teens start to emerge as cheap NIL labor, their guardians should make sure they understand federal and state labor laws regarding the harnessing of youngsters as wage earners.
They should also discuss the IRS over dinner and ensure Tara’s taxes get paid on time.
Rick Burton is the David B. Falk Professor of Sport Management at Syracuse University and SU’s faculty athletic representative to the ACC and NCAA. His co-authored book, 20 Secrets to Success for NCAA Student-Athletes (Ohio University Press), was released in July.