At least 100 workers are set to lose their jobs at Detroit Metro Airport, as the Wayne County Airport Authority (WCAA) looks to cut costs by $20 million over the next 12 to 15 months.
Turkia Awada Mullin, CEO at WCAA, has revealed that the airport authority has a huge budget deficit of around $32 million dollars which needs to be remedied, and one of the solutions to reduce this is to start cutting staff.
Speaking to a local news agency, she said “We either right size the administration so you can start paying your bills or you pass this on to other airlines and who ends up paying that? The consumer, in the form of higher ticket prices.”
Awada's solution is to cut 100 employees. She said credentialing is overstaffed and inefficient and therefore wants to cross train firefighters and airport police to allow her to make cuts to credentialing.
She also wants to cut equipment maintenance positions.
Furthermore, Awada said the cuts will be made through an attrition-retirement programme which will offer workers six-months severance pay.
She told the news agency that if not enough staff accept the programme and severance, she will lay off the rest.
She said: “If you left it unattended it won't be 100 people who have to suffer, it will be 200 people.”
Today (30 September) the airport authority confirmed that it will “significantly realign its business operations and aggressively pursue new revenue sources as part of an intensive plan to reduce expenses by $20 million over the next 12 to 15 months.”
The WCAA board has approved a $292 million budget for 2012 that will “include the strategic reorganisation of staffing resources, wage and benefit changes for employees, and the exploration of shared services and partnerships with other governmental entities.”
Mullin added: “It’s imperative that we re-engineer Detroit Metro and Willow Run Airports so that they become the most competitive in North America.
“Our region has made major investments in our world-class airport facilities and we must operate them efficiently to maximise the economic benefits that they generate for southeast Michigan.”
The economic downturn throughout Michigan over the past decade has contributed to the authority’s financial pressures, and Detroit Metro Airport served four million fewer passengers than it did at its peak in 2005.
In addition, the WCAA carries high debt loads on the McNamara and North terminals, both of which opened within the last nine years and were designed to accommodate projected traffic growth that has yet to materialise.
Earlier this year, the board initiated $21 million in additional cuts by reducing operational costs and deferring planned capital improvement projects.
Renee Pipis Axt, chair of the WCAA board said: “We are demonstrating fiscal discipline by not passing our budget shortfalls on to the airlines.
“That was the previous practice, but our current board rightfully recognised it wasn’t a sustainable one.”