1500 Management/Salaried Workers to Go Home Soon

Nearly 200 ticket agents will go home by the end of the month, as United closes its last 32 ticket offices in the US. Those 188 employees will be joining the 1500 managers and salaried employees who will start walking the breadlines on the 19th of this month. That was Friday's news from UAL.

The closing of the ticket offices, judged by many an anachronism in today's internet-purchase world, was not really a surprise to anyone in the industry; and the managers and salaried employees will be plucked from lower and middle-level jobs. [After all, middle-level managers don't make such decisions; and those who do, aren't about to cut themselves out of their paychecks! --ed.]

Last year's reductions, including nearly 9000 in December alone, totaled some 20,000. If United isn't showing a believable plan for an operating profit soon, it is quite likely to be the largest collapse the industry has ever seen; and it could be merely the first of several, as air travel continues anemic, and as costs -- particularly some labor costs -- remain stubbornly high.

For the ATSB to grant United's wish of taxpayer-backed loans, to the tune of $1.8 billion, two things need to happen:

• United needs to convince the Air Transportation Stabilization Board that its current predicament is the direct result of September 11 (and not primarily decades of mismanagement); and
• United needs to present a believable plan to turn a profit, operationally at least.

Prognosis:

The first item is ridiculous on its face, but, with politics being what it is, the ATSB may be told to overlook the intent of its existence, for the sake of keeping some employed in a badly-managed company, rather than setting them free to get jobs at a productive airline, or in some expanding industry.

For the second condition to be met, UAL will have to figure out a way to convince its unions (notably the self-destructively-stubborn IAM 141-M local and their boss, Tom Buffenbarger, right) to take less for doing more, with fewer people.

The bankruptcy judge may soon (perhaps as soon as Friday) have something to say about that, regardless the ATSB's actions. [The machinists, last week, rejected a plea from the airline, which had asked for pay cuts. The union bosses said that UAL hadn't proven the labor-cost-reductions were immediately necessary --ed.]

FMI: www.ual.com