In the non-union private business world, starting pay rates are negotiated between employee and employer.Bob Owens said:And do the starting pay rates never increase?
Doesn't matter in terms of talking about cost reductions. We can discuss the issues of declining pay in another thread. The only reason the topic came up at all was in the context of options that airlines have at their disposal in down times to reduce capacity.Are you aware that the starting pay for a title I mechanic at AA is lower today than it was 25 years ago?
The argument that the concessions are smaller than the losses that cause the airline to demand them in the first place.The SEC filings support what?
Not just the timing. The graph tracks the magnitude as well.Well what else would it do? What excuse could they use for losing money when everyone else is doing well? Why bother, there will always be another economic cycle.
It's only invalid if all of the employees in the class are at top pay.Your example ... is not valid for a mature company like AA where the majority of employees are at top pay.
Fine. Depending on how you look at it, you could make such a claim. It doesn't matter in describing the ramifications of shrinking the airline during times of decreasing demand.Sure we do (generate revenue).
So I get a graph that doesn't answer my question, and a snotty response. This must be my lucky day!Well now thats what you are getting.
Whatever. It still doesn't matter in the end, because the bottom line is that shrinking an airline during down times causes increased unit costs. It's one of the two big factors that lead to the oft-repeated statement that airlines don't shrink to profitability.If you want to make an arguement you cant expect me to go and provide you with the ammunition.
To bring this back to the core topic...in a down economic cycle, an airline can shrink, but doing so increases unit costs and necessitates exiting markets in many cases. Do you agree with this crucial point?