Managerial casualties and frictional unemployment

The news that Glen Roeder has been sacked as manager of Norwich City is a reminder of the precarious nature of management in the professional game. The average tenure of a new boss is little more than two years and the League Managers Association web site is a great place to go to find news of the latest batch of people to be shoved through the revolving door.

For many in the professional game, short periods out of work is a recurring fact of life - they are experiencing frictional unemployment whilst waiting for the next ‘big club’ to come calling.

Whether rapid changes of manager actually fundamentally changes the performance of the club on the field is another matter! This article from Tim Harford’s Undercover Economist site dates back to November 2007 and the untimely departure of Martin Jol from Tottenham. But it is still worth reading because Tim flags up research from a committed economist and soccer follower Chris Hope from Cambridge University.

“Christopher Hope is an economist at Cambridge University specialising in the costs of sacking football managers (and the costs of climate change). He estimates that when a manager is replaced, the typical team loses more than 10 league points from the disruption, equivalent to three wins and a draw. The cost of paying off the manager’s contract means less money to pay players and so a further modest points loss.”

“Nevertheless, Hope’s analysis recommends that clubs should sack their managers more often. He has concluded that the following algorithm would improve the performance of premiership clubs. Any new manager should have an eight-match honeymoon, during which time he is safe from sacking. After that, his average results should stay above a miserly 0.74 point per game; that average should be weighted to put about half the emphasis on the most recent five games.”

Should we apply a similar approach to the contracts of Economics teachers?