Hard Landing for Laid Off Workers

March 30, 2006 – A new book by New York Times economics reporter Louis Uchitelle, takes a hard look at the widely accepted notion that retraining and re-education programs can provide laid off workers with comparable employment or similar wages.

The Disposable American: Layoffs and Their Consequences” features the experiences of hundreds of United Airlines’ aircraft mechanics furloughed from the company’s Indianapolis Maintenance Center in 2003. Led by insurgents from the Aircraft Mechanic and Fraternal Association (AMFA), the mechanics embarked on a slowdown, decertified from the IAM and ultimately went from career jobs that paid $31 an hour with benefits and pensions, to jobs paying as little as $10 an hour.

The former mechanics also came face to face with the hard realities of federally subsidized worker retraining programs. By the spring of 2004, only 185 of 800 former mechanics who went through such a program were working again. “Despite their skill, 33 of those 185, or 18 percent were earning less than $13.25 an hour working in warehouses, on construction jobs, in restaurants or in retailing,” writes Uchitelle. “Only 15 of the re-employed mechanics had regained their United wage level or exceeded it.”

A national survey by the Bureau of Labor Statistics confirms the loss of wages following layoffs. Two years after a layoff, two-thirds of the victims say they are working again, but only 40 percent report they are making anywhere near what they did in their old jobs.