Workers still on the job, but making half as much

MECHANICSVILLE, Va. — The dark-blue captain's hat, with its golden oak-leaf clusters, sits atop a bookcase in Bryan Lawlor's home, out of reach of the children. The uniform their father wears still displays the four stripes of a commercial-airline captain, but the hat stays home. The rules forbid that extra display of authority, now that Lawlor has been downgraded to first officer.

He is now in the co-pilot's seat in the 50-seat commuter jets he flies, not for any failure in skill. He wears his captain's stripes, he explains, to make that point. But with air travel down, his employer cut costs by downgrading 130 captains, those with the lowest seniority, to first officers, automatically cutting the wage of each by roughly 50 percent — to $34,000 in Lawlor's case.

The demotion, the loss of command, the cut in pay to less than his wife, Tracy, makes as a fourth-grade teacher, have diminished Lawlor, in his own eyes.

Pay cuts more frequent

In recent decades, layoffs were the standard procedure for shrinking labor costs. Reducing the wages of those who remained on the job was considered demoralizing and risky: The best workers would jump to another employer. But now pay cuts, sometimes the result of downgrades in rank or shortened workweeks, are occurring more frequently than at any time since the Great Depression.

State workers in Georgia are taking home smaller paychecks. So are the tens of thousands of employees in California's public university system. The steel company Nucor and the technology giant Hewlett-Packard have embraced the practice. So have several airlines and many small businesses.

The Bureau of Labor Statistics does not track pay cuts, but it suggests they are reflected in the steep decline of another statistic: total weekly pay for production workers, pilots among them, representing 80 percent of the work force. That index has fallen for nine consecutive months, an unprecedented string over the 44 years the bureau has calculated weekly pay, capturing the large number of people out of work, those working fewer hours and those whose wages have been cut. The old record was a two-month decline, during the 1981-82 recession.

"What this means," said Thomas Nardone, an assistant commissioner at the bureau, "is that the amount of money people are paid has taken a big hit; not just those who have lost their jobs, but those who are still employed."

His current employer, ExpressJet Airlines, is a spinoff from a feeder operation for Continental Airlines. It brought passengers to Delta hubs as well, mainly in the West, and to help handle that traffic, Lawlor was promoted to captain from first officer in July 2007. His pay rose to $68,000, with the prospect of reaching $100,000 — roughly triple a first officer's pay.

That is not so much money by the standards of an earlier era. Even senior captains on legacy airlines rarely earn above $200,000 today, as they often did in the past.

But Lawlor felt he was headed in the right financial direction until the economy, and the airline business, took a tumble.

Tailspin into crisis

In the 14 months that he held that rank, his $68,000 in pay and Tracy's $40,000 as a fourth-grade teacher were enough, as Lawlor put it, for the family — for the first time — to spend freely and still save money.

He purchased a white gold 10th-anniversary band for his wife and a bright-yellow Harley-Davidson motorcycle for himself. The $10,000 Harley sat for months in the garage before it finally sold, with only 175 miles on the odometer. While Lawlor was still a captain, his parents decided to move into smaller quarters, and their son and daughter-in-law bought their five-bedroom house, getting a break on the price but increasing their mortgage payment to $2,000 a month from the $1,200 they had paid for their smaller home nearby.

They closed on the house in August 2008, on the eve of the downgrade, and soon there were regrets. "We would not have bought the house on a first officer's salary," Tracy Lawlor said.

Their savings, built up in the good years, have dwindled to $10,000, from $28,000 last fall, and Lawlor said the next rung down, to four figures, is in his mind a crisis level. Lawlor is vice chairman for contract enforcement for the ExpressJet unit of the Air Line Pilots Association. He had volunteered some months ago for the unpaid role, and now his fellow pilots seek his help in resolving scheduling disputes, pay issues, meal reimbursements.

As a captain for ExpressJet in calmer times, Lawlor commuted across the country to Los Angeles, his home base, for each three- or four-day trip. Now, as a first officer, his base is Newark, N.J., a far shorter commute from the Lawlor home in this Richmond suburb. So he is home more. He spends that time caring for the two youngest children, Shayne and Jackson, 16 months, while his wife takes the two oldest, Zachary, 7, and Kelley, 10, with her to the elementary school where she teaches and they are enrolled as students.

The Lawlors, both 34, have hidden their straitened circumstances from their four young children, mainly at his insistence. But as their savings dwindle, Christmas, a key indicator in the Lawlor family, will mean fewer presents this year. The Lawlors have made a practice of piling on toys and new clothes for their children at Christmas, buying relatively less the rest of the year. That will make a cutback noticeable this holiday season, and the parents are concerned that their children will begin to realize why.