Why airlines tend to be unionized

A bit meta, but it's interesting to see how much this guy has reinvented himself over the years. Going from running the biggest, loudest, and most profitable software consulting firm in the world... to retiring to play with photography and airplanes... to junior pilot at a small airline.<p>Some might say going from $MM/year CEO to $18k/year new guy would be a step down, but he seems to be genuinely enjoying the ride. I especially like how he keeps the whole "dot com millionaire" thing hidden on his aviation resume:<p><a href="http://philip.greenspun.com/narcissism/resume" rel="nofollow">http://philip.greenspun.com/narcissism/resume</a><p><a href="http://philip.greenspun.com/flying/resume" rel="nofollow">http://philip.greenspun.com/flying/resume</a><p>If you haven't read about the guy, it's worth picking up a copy of Founders at Work just for his interview.

Airlines tend to be unionized because fifty years ago, <i>every</i> major industry in the US was unionized. The large-scale shifts in the American economy in the 1970s and 1980s (less manufacturing, more services) accompanied changes in law, regulations, and public opinion that made it harder to organize unions.<p>Senior pilots make more than junior pilots because back when the government set routes and fares, the airlines collected higher-than-market revenues, which they could share with the pilots. After deregulation, the industry was no longer so profitable, and the pilots’ union compromised by protecting its existing members’ salaries while letting new pilots make less.

This happens similarly in American professional sports. Young, incoming players can't choose their own team - instead, they're subject to a draft, and controlled by the team that drafted them for anywhere from 4 to 10 years. During that time, the players make very below market money and have no leverage. Then, after they become a free agent, they get overpaid relative to equilibrium. The veterans that have more say in the union consistently bargain more benefits and agree to hose the young incoming players in return.

"Union agreements and seniority-based schedule assignments lead to reduced safety for passengers, as the least experienced workers are pushed the hardest and get the least amount of rest. "<p>The reason junior officers get paid 16k a year is because there are people willing to do the job for 16k a year. Without the unions airlines could probably get volunteers (much like Greenspun who is certainly not doing it for the money) to fly their planes. But then we would have every pilot inexperienced, overworked, and underpaid.<p>Yes, the airlines are a mess, but he provided no evidence for his arguments. Southwest has been consistently profitable. Why haven't the pilots eaten up all their profits?

<i>Regardless of whether the U.S. is able to maintain its trade barriers, a sustainable long-term structure would be a pilot-owned airline. If the pilots are the owners there need be no conflict concerning distributing profits.</i><p>Selling the company to the union, or rather, worker-owned companies seem to be the best case solution to the "union problem" - If my employees started unionizing, that'd be my first shot at a solution "Hey, uh, so I hear you don't like how I'm running the place. How 'bout you take a shot?"<p>Of course, the only way I've ever heard of that working is with large, established unions, which have large established pension funds that can be leveraged.

This seems a bit strange.<p>If pilots were actually taking nearly all airline earnings, why are there airlines at all? Running an airline requires a substantial capital investment, and if the return on those investments is effectively zero (or much smaller than other businesses), then there shouldn't be airlines because it's just not a profitable business, right?<p>The other thing is, given the rules he outlines, an airline could drastically reduce its costs by hiring more junior pilots and firing senior pilots. How would they hire more junior pilots? By paying them slightly more than competing airlines. So there should be pressure in the market to increase the salary of junior pilots, which long term should lead to higher salaries for juniors. This seems to contradict the authors experience.

Always interesting to watch the American labor movement eat itself. Depressing but interesting.

So why don't junior pilots form their own union? Wouldn't that introduce more competition into the labor market and equalize (or at least rationalize) pay between "junior" and "senior" pilots? Or is aviation one of those industries where working your way from the bottom is celebrated?

I think I've been working too long today. I read that headline and stared at it for a good 10 seconds trying to figure out why on earth airlines would be "un-ionized".

Not sure I'm convinced about this point:<p><i>how can we explain a 19:1 pay differential..? The answer is to look at who controls the pilot's union: very senior pilots.</i><p>Why wouldn't the junior majority vote out the senior minority or leave the union?

<i>who controls the pilot's union: very senior pilots.</i><p>Most airlines are made of a lot of junior pilots. Junior is a relative term because you can be with the airline for a decade and be considered a junior. The senior pilot making $300k is an anomaly at the airline, like the Welfare Queen in politics. So when the airline wants to cut salaries these dozen (for a large airline) or so senior guys, that are almost near retirement, are the ones put on the press release as the big bad pilots. To the guy making $300k taking a 25% paycut, its not a big deal, the guy making $16k taking a 25% paycut, BIG fucking deal.<p>And just like politics, airline pilot unions don't always vote rationally. They could vote in a system that randomizes schedule according to availability, but they'd much rather keep the bid system. I guess its a case of "I got mine" where the senior guys get to choose the priciest routes. And the junior guy wants what senior has even if its costing him. Taxes on the rich are the same, they are an easy target but the middle class don't want it because they might be one of them one day.<p>I don't think you'll find a person alive willing to say I, with 25+ years, is okay with you firing me if the junior gets to keep his job. No one wants to be furloughed and as you get higher up in the company the stakes get higher so don't expect this piece of union contracts to change. Not for pilots, not for detroit, not even in the IT sector; you know, last hired first fired.<p><i>If airlines paid workers according to personal experience and skill rather than seniority within their particular airline, pilots would be more likely to live near where they worked.</i><p>Capt. Sully could stay in SF but there are more senior pilots who are just as experienced as him, there. To move up the ladder he chose to go to NC. Hell, even Heather Poole, FA blogger on gadling, chose to take NYC while living in LA. Your choice is either to get experience working at a different FBO, or be on reserve, sitting in the terminal, not getting any experience. Tough choice, huh?<p><i>An airline that is successful and growing will enjoy lower costs because of the new pilots being hired for almost nothing.</i><p>If you are referring to LCCs most are just a proving ground for pilots until they can make it to mainline carrier. So you have cheap, inexperienced pilots and lots of churn with the best, most experienced pilots leaving for better conditions. I'd like to point out that LCCs like Jetblue and SWA are anomalies. Most LCCs operate on razor thin margins and are usually just a few months away from bankruptcy. The good ones grow the bad ones you never hear about.<p>Also, for airlines the biggest expense is the plane itself. labor is such a minuscule part of the operating budget that if they are in trouble cutting there is just laughable excercise. The pilots, the flight crew, and the ground crew know this. A declining airline will, in this order, cut routes, crew, and then aircraft. With the aircraft being the 800lb gorilla in the room.<p><i>The author is type-rated in the Canadair Regional Jet and Cessna Citation Mustang and has more than 3500 hours of flying experience</i><p>Most mainlines require 5000 hours. For now, you couldn't get a job with the big boys even if you wanted to. Anyway, when you do cross that threshold and see things from the other seat I wonder if you'll have the same opinion. In any case godspeed with your career.

A pilot's job is one of the easiest to replace with a computer. It is already happening in the military. In fact, the only actual role of a pilot today is to take off and land the plane, the rest is auto-pilot.<p>If the unions make it so hard to employ humans, it would only give incentive to further develop auto pilots, and the problem will solve itself.

<i>A competent pilot union negotiator will present the airline with a plan to transfer essentially all expected future profits into the paychecks of pilots</i><p>and<p><i>...the pilots, having expected to collect 95 percent of the airline's profits, will in fact be entitled to 115 percent...</i><p>WTF! Did the pilots think about the poor entrepreneurs and shareholders who own the business?<p>More reason why labour should be fungible. Some unions really rile me up.

"the FAA will not allow this because those replacement pilots, though competent with the airplane, do not have experience with the <i>specific operating rules of the airline</i>"<p>Then why don't the airlines standardize their operating rules?

Odd. I would have thought with the time that they spend at high altitude, and the corresponding above average exposure to radiation, that they would tend to be more likely to be ionized.