The exact nature and location of the job cuts announced yesterday at Qantas are still sketchy, but Alan Joyce’s announcement indicates 5000 equivalent full-time jobs will be cut in the next three years, with four thousand jobs scheduled to end in 2015.
The cuts will include 1500 non-operational jobs in management and customer service, a similar number of operational job losses - associated with fleet and route rationalisation and the restructuring of line maintenance - and the remainder accounted for by the restructuring of catering operations.
The total includes already announced job losses associated with the closure of Qantas’s Adelaide catering facility. It appears that most of Qantas’s Adelaide-based operations will close, with reports of engineers, baggage handlers and check-in staff already being offered voluntary redundancies.
The 5000 effective full-time jobs might translate into a higher number of actual jobs lost if part-timers are targeted. In its announcement, Qantas promises to work with employees to minimise the adverse impacts of these redundancies. This is already evident in the timing of the Qantas action, which puts Qantas workers ahead of Ford, Holden and Toyota workers in the job queue.
The realities ahead
All large-scale job loss events throw large numbers of workers with similar sets of skills onto the labour market at the same time. This creates long queues of jobseekers competing for the same types of vacancies in the same places. Work in the aviation sector is highly specialised but the local aviation sector is not expanding, so the chances of retrenched workers finding another job in aviation are slim. Those former Qantas workers who eventually find work in new occupations in new industries will face quite significant long-term losses as they rebuild their careers from scratch.
The job queues created by large-scale retrenchment events tend to be occupation-specific, resulting in quite different experiences of unemployment and patterns of outcomes for different groups of workers.
In the case of former Ansett Airlines employees, workers who had held generic customer service jobs and those with a non-aviation specialisation (the accountants and human resources managers, for example) were re-employed quite quickly, often finding jobs that were equivalent to or better than their Ansett Airlines jobs.
Many large employers (like Telstra) recognised the quality of the Ansett workforce and employed former Ansett employees who then recommended their former colleagues. This created numerous “Ansett clusters” in large firms. If Ansett is taken as a guide to what might happen at Qantas, this group might take up job search assistance but are unlikely to require retraining.
The Ansett engineers typically found work with Virgin, Qantas or a regional airline, often relocating to another city as they followed the work opportunities (typically from Melbourne to Virgin’s maintenance centre in Brisbane). It helped that Virgin was expanding rapidly to fill the gap left by Ansett’s departure.
Engineers and information technology workers who are highly specialised in technologies that will become obsolete as airlines upgrade their fleets and systems are especially vulnerable and will need skill upgrade retraining. Given the poor prospects of finding work in Adelaide or Melbourne, it is likely that skilled aviation specialised workers will be looking to relocate overseas.
Cabin crew face real difficulties too. Some of the Ansett pilots were absorbed by other airlines, but many were forced to search for work globally. Those who found work in other countries were well remunerated but at the cost of their social lives. Older pilots tended to take up a semi-retirement occupation, often investing in a small business. The worst outcomes for former Ansett employees were among former flight attendants, who were systematically overlooked by other airlines. A group of former Ansett flight attendants eventually won a discrimination case against Virgin. Flight attendants could retrain in a variety of customer service occupations.
Aviation sector workers face different challenges to other job losers. First, as a result of the aviation sector’s inhospitable working hours, airline workers tend to socialise with (and marry) one another. Among former Ansett employees there were many instances of couples and extended family groups all losing their jobs, and as consequence also losing their homes.
Second, again as a consequence of the nature of the aviation industry, many Ansett employees depended emotionally on the “Ansett family” and its particular (almost militaristic) social mores. For some, the loss of that family and consequent social isolation was devastating, resulting in numerous post-Ansett suicides.
What can be done
Narrow social networks make it difficult for former aviation workers to transfer into other sectors using the “word of mouth” networks that are known to be one of the most effective job search strategies. On the positive side, Ansett workers were active in building social support networks that held their family together. Qantas should offer access to independent financial advice for workers and fund worker self-help groups. Information sessions on how to negotiate Centrelink are a must.
The Qantas job cuts are going to affect a relatively small segment of a large workforce. It is often the case when redundancies are selective that some people feel they have been singled out unfairly. This effect is clearly associated with poorer outcomes, which underscores the need for careful management of the process. Regardless of the truth, some prospective employers will assume that Qantas is targeting less productive workers, so being singled out for retrenchment does have an adverse impact on re-employment prospects.
Another peculiarity of aviation sector job losses is that they produce a ripple effect through the industry, creating a giant game of musical chairs. Qantas and Virgin both employ large numbers of former Ansett employees, and Virgin has frequently recruited from Qantas. People know each other and know who they want to work with. These redundancies will open up the labour market: Qantas will reshuffle its workforce in an effort to keep its best people, but other airlines will be making counter-offers. In this context, casual and permanent workers at other airlines may be let go to make room for talented former Qantas recruits.