Talent becoming more important than salary efficiency in rising cap era

While the rising price of groceries might have you wondering about the health of the economy, it’s safe to say the NHL’s economy is doing just fine. Through the seasons affected by the COVID-19 pandemic, the NHL’s salary cap stayed relatively flat, barely increasing from $81.5 million in 2019-20 to $83.5 million in 2023-24. In the two short years since then, the salary cap has already shot up to $95.5 million, and is projected to only climb higher in the coming seasons.

During the flat cap era, teams had to pinch pennies and watch every dollar to ensure they had enough money for their entire roster (sorry for any PTSD, Leafs fans), but now that the cap seems to be forever rising, teams can be a lot more liberal with their spending. Even with what projects to be a middling UFA class this summer, teams will likely be much more willing to overpay for free agents, with the idea that a player’s salary will take up a smaller percentage of the cap in each subsequent year.

On Thursday’s episode of Daily Faceoff LIVE, hosts Tyler Yaremchuk and Matt Larkin discussed the free-spending approach NHL teams could take with the rising salary cap.

Tyler Yaremchuk: In a flat cap world, cap space was so valuable. Teams had assets, no one had money. Now everyone’s going to have money here, Matt, and I think we need to totally reevaluate how we view especially UFA contracts right now.

Matt Larkin: I think you’re right. “It’s only money” might be the new mantra, especially because it’s pretty clear in this rising cap world, good players are not going to make it to market nearly as much as they used to. I think we have to agree that’s the case now after what we’ve seen over the past year. You are going to see bidding wars, and yes, it’s going to be tough to stomach, but you’re going to have to reach a point where you say “Well, we either get this player with an overpay, or we don’t get the player, and we don’t upgrade our roster, and we do have to dip into our prospects and go to the trade market and make a trade that has a higher acquisition cost than just a signing.” So, I do think you’re right.

You can catch the full discussion and the rest of Thursday’s episode here…