"For Many Years to Come"

[Eagle]

from Wendy Zellner's article in Buisness week.


A First Officer--"For Many Years to Come"



Worker morale is top priority at American Airlines Inc. these days. CEO Gerard J. Arpey was thrust into the top job after predecessor Donald J. Carty's fiasco over hiding fat executive bonus and pension deals from employees while they voted on concessions to avoid bankruptcy. Now, Arpey faces distru####l employees, who feel that management duped them into swallowing huge cutbacks. "People are being asked to work harder for less pay. That obviously does not create an environment for happiness," conceded Arpey in an early May session with reporters. He reiterated the point at American's annual meeting on May 21, where he said that none of the company's turnaround initiatives "can fully succeed until we build trust and teamwork back into the company."

This could take a Herculean effort with pilots like Thomas W. Hoban. Even before the pilots approved the pay and benefit reductions in April, he had been badly battered by the new realities of the airline industry. After a decade with the company, Hoban had just moved up to a $157,000-a-year captain's post on an MD-80 jetliner when the terrorists struck on September 11. The workforce cuts that followed the post-attack travel slump busted him back to co-pilot on a Boeing (BA ) 777, slicing his pay to $137,000.

The new austerity will knock Hoban back again, to about $95,000. He also will have to work several more days a month under the new work rules the pilot's union approved. Nor is he likely to get back into the captain's seat any time soon. "I'm going to be a first officer for many years to come," says the Michigan native, who's 42.

Hoban believes his future is tied to American's, but he was among the 31% of American's pilots who voted against the cuts. He did so mainly because he believed that bankruptcy was inevitable no matter what employees did. Those fears were heightened on May 15, when American said it may still seek bankruptcy protection, which could spur management and creditors to come after workers for yet more givebacks. "I don't believe in giving them two bites of the apple," says the trim, boyish-looking former Marine, who doubts he will ever again make $157,000 at American.

He and his family are starting to make some adjustments to their comfortable lifestyle in Arlington, Tex. -- near Dallas-Fort Worth International Airport. The new Chevy Suburban Hoban bought after his promotion to captain is for sale, which will leave the family with a 13-year-old Honda Accord. The vacation house in Angel Fire, N.M., may go on the block, too. Hoban and his wife, Yvonne, recently refinanced their Brady Bunch-style ranch house to cash out some of the equity and help ease their sharp income fall.

Hoban is also working on a second career. Other pilots he knows are turning to mortgage lending and even pool cleaning; he's studying to become a licensed real estate appraiser, hoping it will give him the flexibility to work when he's not piloting. Yvonne, meanwhile, is gearing up to look for full-time work -- supplanting the home businesses she started so she could spend more time with their two children, 10 and 7.

Hoban is willing to give Arpey the benefit of the doubt. "I think he understands the employee relationship problem we have here and the impact it has on the bottom line," he says. The mood already has improved since Carty's exit. It went a long way when, in Arpey's first days, he apologized to employees for their sacrifices and praised them for American's solid operational performance. If Arpey can lift morale and alter the bitter labor relations, his legacy will go beyond just averting bankruptcy.

By Wendy Zellner in Arlington, Tex.

[FlyChicaga]

$95,000??? Oh cry me a river. That's what senior NetJets captains make now, and they love their job. But I guess if I was in his position I'd be really pissed off!!!

[Doug Taylor]

$100,000 after taxes is a lot less than many think! Especially if you own a house and are married.

[Eagle]

[ QUOTE ]
$100,000 after taxes is a lot less than many think! Especially if you own a house and are married.

[/ QUOTE ]

HUMM LETS SEE,!!

200,000 mortgage. @ 5%
1100.00 plus tax _ ins easy 1500$ a month.

100,000$

$ -18,000 house

$ -31,000 fed income tax (31%)

$ - 8,000 state income tax (8%)

$ - 10000 car payments gas maintence and ins

$ - 4000 student loans

$ - 4500 food.

= $24,500 left for investing, kids, home improvement, entertainment, vacation, etc etc


Yeah rollin in the dough

[mrivc211]

Looks like the upper classes union busting tactics continue to work.

They begin to talk about furloughs, cutbacks, and possible bankruptcy to start to really make you scared and give in. Then when its all said and done, guess who's making the big fat bonus.

You think $95,000 is a lot of money for the kind of sacrifice we make to our loved ones let alone our pride. We threaten our lives daily, risking it all for the chance to one day live our dreams.

Let's compare what my cousin, a recent UCLA Bio-molecular graduate, recently accepted to NYU dental school will face compared to me.


Him-
Graduated High School and attended UCLA for 5 years.
Did not work at all while attending school.
He will likely finish NYU in 4 years and return to california to begin his career. Lets give an extra 1 for him to settle down and grasp his feet when he leaves dental school.
First year out making around $90,000. Making well over $150,000 byu his fifth year.

Thats roughly 10 years.

Me- will gradute UCI in two weeks. Took 5 years. Same as him.
Started flying 3 years ago while attending school.
Worked full time to pay for flying lessons.

Will instruct for probably 2-3 years before finding a job at a regional making $20,000/year for 4-5 years.

Then wishfully hoping to find a job at a major only to make $95,000 by my 10th year?

You do the numbers.

[Doug Taylor]

Actually,

(and very approximate)

subtract about 10% for 401(k),

$840 for cable,

$480 for internet service,

$350 for HOA fees,

3% of your home cost per annum for repairs and upkeep expenses (gotta have a reserve for replacing that AC unit!)

That's about $1,500 per month extra. With zero credit card debt, no investments, no children, no pets, nothing extra. Heck, if you have one kid, I've heard, take another $1,000 per month out of that and you've got a whopping $500/month!

If you've taken out a $80 to $100,000 dollar Key Loan to pay for flight training, holy smokes, you'd better have a second job!

Yeah, Beverly Hills, here we come!

BTW, Eagle, where were you able to find a $200,000 in the northeast that's not in a crack neighborhood? And at 5%? Man, I wanna talk to your mortgage broker! Time for a re-fi!

[Jason]

[ QUOTE ]
BTW, Eagle, where were you able to find a $200,000 in the northeast that's not in a crack neighborhood?

[/ QUOTE ]

He lives in a trailer park in Jersey! j/k

Seriously - it sounds like many people are finally starting to realize that aviation isn't the high dollar glamorous career that everybody thinks it is! I like flying but it is my JOB - nothing more nothing less. I'm starting to get things in order to possibly attend law school in '04. I like flying but living the lifestyle I want - where I want, decent family life, etc - is far more important to me than what job I do to attain that lifestyle.

Should you work to live or live to work?? Alot of people have it backwards.

Jason

[Eagle]

[ QUOTE ]
BTW, Eagle, where were you able to find a $200,000 in the northeast that's not in a crack neighborhood? And at 5%? Man, I wanna talk to your mortgage broker! Time for a re-fi!

[/ QUOTE ]

Yeah tellme about it, know those stupid signs nailed to the telephone poles?

Farmer's Field view Homes with an arrow pointing you to the sales office?

usually the crappy tract homes etc..

we have one, and I have been meaning to get the camera out (I will and post it this week)

these say.

Acme field views
single family homes.

From the

590s.

Excuse me?

FIVEHUNDREDNIGHTYTHOUSAND SMACKERS?

oh these houses are under the power lines.

yeah I will take the pix this week.

[Doug Taylor]

Oh believe me, I know.

Anywhere you really want to live in this country is going to cost some big smackeroonies. We had a couple over at our house last night that found a fairly nice 2800 sq'ft house for around $210,000 without a 'lot premium'. Of course it's "zero lot lined", backs up to another house, 100% plain dirt, no view and 40 miles west of downtown PHX (far west of the west loop of 202 for you PHX people)

Holy crap! That's damned near Yuma! They could almost justify flying a regional from there to downtown PHX and getting a cab to work because of the impending traffic snarls.

[n77j]

My brother has been a hardware engineer for a Silicon Valley firm for 7 years. His yearly income is $75,000! He lives of course in Silcon Valley, which is one of the most expensive places to live in the nation. He has family to support and a mortgage to pay and so forth.

Now going back to this poor captain making $ 95,000 and based out of Dallas- pathetic . I am really surprised and ashamed that most people in the forum are sympatizing with our fellow pilot pay cut. How about those poor flight attendants who are merely making $46,000 after 6 or 7 years at AA and getting a pay cut...and how about those mechanics who do are not even making a descent wage? Are you guys thinking about those? Now- Mr. Captain all i have to say is get on with your life and thank God you still have a job!

[mrivc211]

[ QUOTE ]
How about those poor flight attendants who are merely making $46,000 after 6 or 7 years at AA and getting a pay cut

[/ QUOTE ]

I don't think the FA's had to cough up as much money and time for training! we're talking about 15 years of training and preperation for our careers. Most flight attendants merely apply for the job and then are trained by the airline.

[Doug Taylor]

Well, what about the garbage collector that only earns $35,000 or the guy working out in the hot sun on landscaping that only earns $6/hour?

I think it's the American way that you're paid according to sacrifice, risk and "scarcity of skill".

If you look at the NBA, you could earn $6,000,000 in a contract whereas the guy selling hot dogs only may earn $30 per game day.

The guy selling hot dogs can't reliably sink a ball from the 3-point line and fill a stadium with people willing to spend $45 for a ticket to see him do it. Jason Kidd (perish the thought), could probably easily hop up into the bleachers and peddle hot dogs fairly easily.

But without the hot dog guy selling hot dogs, you'd leave the stadium with a hankering for a snack, but without Kobe Bryant on court, you'd be at home watching Judge Judy and not at the game.

Yes, flight attendants endure training, continuing education and are away from their families as much as pilots. But would I be able to walk in back of the cabin, smile, serve beverages and assist in an evacuation? Probably so.

But would a flight attendant come to the cockpit, relieve a flight officer of duty and land a MD-88 with a logbook full of MEL's, on a single-engine to a hand-flown ILS approach to minimums in moderate turbulence at LGA? Ehh, probably not. But I can, and will have the professional composure to ask for another heapin' helpin'

I think once we start basing salaries off of "fairness" in comparison to what other non-related labor groups make gets us one step closer to a failed Marxist experiment called Communism.

[mtsu_av8er]

Maybe I only feel this way because I came from REALLLLY humble beginings, but that's a silly thing to be crying over. I know alot of people that make it on $30,000 a year, with a car, and a child (or more). And I was raising a child on military pay, which worked out to be about $24,000 (after figuring in the invisible benefits), and 2 car payments. I'm not saying that people that make lots of money are bad or anything, but this guy is really crying over nothing.

You know, I really wish that my biggest financial concern was my pay dropping to $137,000.

[Doug Taylor]

Believe me, I'm from a neighborhood that thought we were wealthy because both of my parents were employed and my dad made $35,000 late in his career.

But I think it's extremely easy when you're making $40,000 as a bartender to look at a captain earning $150,000 and say that his salary is out of whack.

If you're that $150,000 captain with a mortgage, 2.5 kids, a car payment and a pregnant wife who stays home, it's much different perspective.

Just like the teaching profession out here in AZ. Teachers earn less than $30,000 per year and when they asked for a raise, so many other groups chided them because "...hey, I work all year and make that, why should some lousy teacher make (and here's the operative quip) more than me and get all summer off? That ain't fair".

You want the best and the brightest in the cockpits, in the classroom, in the judges chambers and in the operating rooms and you're going to have to maintain financial incentive to incite youth to do what it takes to get there.

Believe me, if my job only paid $50,000, I'd quit. Not because I'm 'above' that, or that I don't enjoy performance of my job, just that the high level of personal sacrifice I endure when it comes to family and friends, it wouldn't be worth it. For example, I've known Kristie since 1993 and this last week was the first time in our life that we've actually spent an entire week together.

Is that worth $50,000 per year? Nah, I'd rather earn that, hate my job and be home more often to spend with friends and family because they're way more important than job satisfaction.

[Jason]

But that's not the point(referring to an above post - not your's Doug)!! There are millions of people that have a very comfortable lifestyle making alot less than our American Captain. The point is that you 'live to your means' - you make a certain amount of money and you develop a lifestlye that fits that budget. If the budget changes then you adapt your lifestyle and no doubt our American Captain will adapt his lifestyle to his new salary level but is it wrong that he's pissed about it???? No way - you would be too. He's worked 20+ years to get to that point - in a matter of months thru no fault of his own his salary dropped 40%(157K to 95K). Is 95K a liveable salary? Very much so. Could any of you guys afford your current lifestyle if your boss called you tomorrow and said that he's reducing your pay 40% and you'll never get back to your current level? Probably not. I sure as he!! couldn't!!! Would you adapt - yes. Would you be pissed? Probably. I would be.

Jason

[n77j]

Jason Doug and everyone- i know life isn't fair and i understand what you guys are trying to say. I am a pilot and a college graduate myself and still lift bags for Delta as a ramp agent. I make merely $16,000 a year and if it wasn't my brother supporting me-i could never afford to live in Silicon Valley.
We live in a capitalist market and like everone else i will have to bend over and take what i get. The article just got the evil out out of me the fact that Mr. Captain's luxrious life was to be cut in half- lose his car and summer home!

[Eagle]

[ QUOTE ]
I make merely $16,000 a year

[/ QUOTE ]

So you'd be ok taking a pay cut to $9600.

Very big of you

[davetheflyer]

$96,000 is still a lot of money. It's probably well above the median income for the rest of the country. I think that articles like this, in which an airline pilot bemoans being reduced to a salary that many people only dream about, cause a lot of damage to ALPA's cause.

I can understand why he's upset though. He probably bought his house and car based on his original income. It will take some cutbacks and budgeting, but $96,000 is plenty of money to live on.

He should be thankful that he is not like hundreds of his colleagues who have no income anymore.

[Doug Taylor]

[ QUOTE ]

We live in a capitalist market and like everone else i will have to bend over and take what i get. The article just got the evil out out of me the fact that Mr. Captain's luxrious life was to be cut in half- lose his car and summer home!

[/ QUOTE ]

Oh, I know.

I think a lot of us were elucidating that $150/year isn't that luxurious whatsoever. I mean, if you earn $150K and leverage your life thru HELOC's, credit cards and other lines of credit, sure. But if you're trying to remain debt free and all, that by far isn't luxurious.

Aviation is one of the few last remaining good paying blue collar jobs and corporate America is doing it's best to stamp it out.

[jaylhumphrey]

[ QUOTE ]
I think once we start basing salaries off of "fairness" in comparison to what other non-related labor groups make gets us one step closer to a failed Marxist experiment called Communism.


[/ QUOTE ]

I agree with you totally Doug. Which is why I prefer the fair market economy in which the price of something is determined by supply and demand. As you stated before there are thousands of furloughed pilots because the demand is soft in the airline industry which in turn drives up the supply of trained pilots available for a few major airline jobs. Pilot supply outweighs demand so Captain Hoban takes a hefty pay cut to keep his job. Communism is once again defeated and the american way preserved.

"Never feel sorry for someone who makes more money than you do."

Jay

[Doug Taylor]

???

[jaylhumphrey]

Sorry didn't mean to try and get all "economical" on an aviation forum. But the fact is that it is the company's bottom line that determines what someone gets paid. As an industry the airlines are experiencing a downturn in the number off paying customers. Since that is the case to stay solvent they have to either increase price (which would drive demand down even farther) or decrease operating cost (which is where the Captain's pay cut comes in).

Do you think Jason Kidd would be pulling 6 million a year if he was attracting as many fans as the hotdog vendor does?

[Doug Taylor]

[ QUOTE ]
Do you think Jason Kidd would be pulling 6 million a year if he was attracting as many fans as the hotdog vendor does?

[/ QUOTE ]

The hot dog vendor does not attract spectators. The spectators are there specifically for what Jason Kidd provides, consistent entertainment. The hot dog vendor serves the purpose of quick, easy to eat snack food in the duration of the sport.

The flight attendant and pilots are more or less the "Jason Kidds" of the airlines. A person chooses a ticket based off of price, service, and the extreme likelihood that they'll arrive alive.

Management determines the price.

IFS handles customer service onboard.

Pilots don't crash the jet.

Pretty simple!

Remember, if price is the sole determinant, if Air Nairobi offered $100 fares from DTW-LGA on a vintage ex-Aeroflot Tu-154, would anyone in their right mind put their families on that jet?

Keep in mind that this is a pilot website and I'm going to voraciously defend my livelihood.

[Jason]

N77J - you're saying that you have to 'bend over and take it' because you make only $16K a year?? This is a perfect illustration of a point Doug made earlier in the thread. Life is about choices. The ONLY reason that you make that salary is because you choose to. You choose to stay in Silicon Valley (sounds like you have family there) and you choose to throw bags for Delta (maybe you like working outside or being around airplanes - doesn't matter). People make different choices based on what's best for them - you choose to stay in a low paying job for your own set of reasons and that's perfectly fine - it's your life. Just don't go around saying that you're bending over and taking it because they don't pay you more. Anytime you CHOOSE to let me know - I can hook you up with a job out here managing a fast food restaurant for twice what you're making now.

I made a choice to make certain sacrafices for this career and in return I expected a certain level of compensation. In the American Captain's situation he made these sacrafices for a long time and I think it's perfectly acceptable that he(or anyone else) earns $157K a year. Looking back at the 10 years that my career has spanned and what I've gone thru and looking forward to the point that I would be in the right seat of a 777 quite honestly I would consider $95K a slap in the face.

I've done some soul searching and a little crystal ball looking and have come to the conclusion that if the economy starts a major turnaround tomorrow it would be a minimum of 15 years before I set foot on property at a major airline. Until that point my salary probably isn't going to significantly change. I'm tired of missing holidays, special occasions, family events, friends, and being on call 24/7/365 for $37K a year. I've made the choice to pursue another career that I have an interest in and that will provide me with the means to live the lifestyle I want.

It's all about choices.

Jason

[Prospective_Pilot]

Truly it is sad that corporate America is trying it's hardest to destroy the dreams that people like myself have just because they don't understand, or care what one is willing to sacrifice to pursue his/her dreams. I do believe airline pilots salaries will go back up again, but will the salaries ever rise to where they use to be?

In the early 90's when the economy fell to what extent were airline pilots affected then? What airline cut salaries the most? By how much? And when the economy did pick up did the salaries ever rise to where they had been? Or above where they had been?!?!?!?!?!?!?!?!?!......


-Amos