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Officials consider Delta fallout

By J. FRANK LYNCH
jflynch@theCitizenNews.com

It’s much too early to know the impact a massive restructuring by Delta Air Lines will have on the Southside economy, where thousands of the company’s employees live, area officials say.

On Wednesday, Delta Chief Executive Officer Gerald Grinstein announced details of the long-awaited “Delta Solution,” a final effort to keep the nation’s second-largest airline in the air.

Grinstein announced that 7,000 jobs would be cut, pay and benefits would be reduced and Delta’s hub at Dallas-Fort Worth would be closed all in an effort to save $3 billion in annual costs.

But even that might not be enough to avoid Chapter 11 bankruptcy, which could come as soon as the end of this month if Delta doesn’t reach an accord with its pilots’ union over early retirement benefits.

Some national analysts predicted the airline might be forced to shut down operations completely, a worse-case scenario that would devestate the local economy but appears unlikely.

More than 3,500 Delta employees live in Fayette County alone, representing more than 10 percent of the company’s Atlanta-area workforce. Among them are many pilots and top-level managers, who earn an annual average salary of more than $93,000, according to Brian Cordoza of the Fayette County Development Authority.

A similar number of employees are believed to live in Coweta County.

Cordoza said Fayette County officials are taking a wait-and-see approach to Delta’s plight.

“We’re hoping for the best and preparing for the worst,” he said. “I imagine it will be weeks or months if we will know anything.”

The 7,000 job cuts announced will come on top of 16,000 jobs already eliminated in the past two years, but it was not said Wednesday when or where those cuts would be made.

More pain might be felt locally if there are severe cuts in Delta salaries and benefits, particularly if Delta families are trying to meet high mortgage payments or other obligations like college tuition.

Cordoza said the news that the Dallas hub would be closed — eliminating 230 flights and scores of employees — could be good news for Atlanta, where the number of flights will increase to more than 1,000 daily. Some of the Texas employees might conceivably be transferred to Atlanta. The growth of the Atlanta hub also makes the spectre of widespread local layoffs less likely.

Cordoza said he and Fayette County Chamber of Commerce President Virgina Gibbs had already met with Delta officials and representatives of both the Georgia Department of Labor and the Atlanta Regional Commission to discuss ways to minimize any negative impact.

Cordoza emphasized, however, that the Development Athority is not a job placement or employment service.

“A lot of people think that we’re the organization that accepts the resumes and helps people find jobs, but we don’t do that,” he said. “We want to provide resources, and that’s getting the word out to those that have lost jobs about where to go and who to call.”