The European football market has contracted for the first time in over a decade, facing a combined revenue drop of €3.7 billion (AUD$5.95 billion).

Key findings from Deloitte’s 30th Annual Review of Football Finance, reveal the combined European football market has decreased by 13% in 2019/20, down to €25.2 billion (AUD$40.52 billion).

The ‘big five’ European leagues had the most significant impact, with combined revenues generating €15.1 billion (AUD$24.27 billion), an 11% decrease from the previous year.

As reported by Deloitte in June, Premier League clubs’ revenue fell by 13% from a record £5.2 billion (AUD$9.81 billion) in 2018/19 to £4.5 billion (AUD$8.49 billion) in 2019/20, being the first drop in total revenue in Premier League history, and the lowest total revenue level since 2015/16.

The impact of COVID-19, resulting in the suspension of the Premier League until its restart behind closed doors, saw a record level of Premier League clubs’ combined pre-tax losses of UK£966 million (AUD$1.8 billion), driven by the £648 million (AUD$1.2 billion) revenue reduction and worsened by the UK£126 million (AUD$238 million) increase in wages.

However, wage costs of Premier League clubs only grew by 4% to £3.3 billion (AUD$6.23 billion) in 2019/20, the smallest increase since 2004/05, while the aggregate total wage costs remained flat across the ‘big five’ leagues.

Across the three tiers below the Premier League, the English Football League (EFL), reported a combined decrease in revenue of 3% to UK£943 million (AUD$1.8 billion) in 2019/20.

Sports Business Group at Deloitte, head chef and partner, Dan Jones, explained: “It will be a number of years before the full financial impact of the COVID-19 pandemic on European football is known.”

Jones said while it has been six months since the pandemic struck Europe, Deloitte’s report focuses on the 2019/20 financial year, thus only accounting for three months of COVID-19 impact.

“The suspension of leagues led to the misalignment of season completion and typical financial reporting periods across England, Spain and Italy,” Jones said.

“This will lead to some elements of revenue and costs related to the 2019/20 season being recognised in the financial year ending 2021, and hence next year’s edition of Deloitte’s Annual Review of Football Finance.”

Premier League clubs’ revenues are expected to rebound in 2020/21, due to the deferral of some revenue from the 2019/20 financial year, before reaching a new record high in 2021/22, as matchday attendances are once again permitted.

Jones said: “Despite the uncertainties of the past year, football – and the public interest in it – has shown great resilience.”

“We are hopeful that the 2021/22 season will be a step towards normality, resulting in a strong recovery in revenue terms across the coming seasons,” he said.