United Airlines yesterday said it remains committed to keeping Guam as one of its hubs, but confirmed it will shed potentially dozens of Guam jobs to keep costs down.
The reductions stem from the airline's plan to close its Guam Contact Center, reduce its airport operations staff and outsource cargo handling operations.
The airline didn't specify how many workers will be let go, but did confirm the contact center has 48 employees. There currently are 42 employees in the Guam cargo department, including agents, management and clerical employees, according to an airline official.
"Under the current collective bargaining agreement, employees affected by this decision may have displacement rights and other options, so it is difficult to determine at this time how many positions will be eliminated," said Koji Nagata, United's director of corporate communications for Asia Pacific.
The changes are part of "company-wide initiatives to increase efficiency and achieve sustained profitability," he said.
"The company will close its Guam Contact Center, outsource its local cargo functions and reduce the number of local airport operations employees," Nagata said.
"The company is in discussions with the employees affected by this decision, providing them with appropriate support and assistance," Nagata stated.
"Guam will continue to be one of 10 worldwide hubs for United," he said.
United Airlines, through its pre-merger presence on Guam as Continental Micronesia, is considered one of the largest providers of private sector jobs on the island.
In 2010, before the merger, Continental had 1,400 jobs on Guam and contributed more than $300 million a year into the local economy in payroll and other forms of spending.
Gary Hiles, chief economist at the Guam Department of Labor, said he wasn't surprised by efforts in the airline industry to try to contain costs. Airlines in general have been under pressure for years to keep costs within reach in light of rising fuel prices, he said.
According to U.S. Energy Department data, 10 years ago jet fuel cost the equivalent of 70 cents a gallon. This year, so far, the cost is more than four times that figure at close to $3 a gallon, according to federal Energy Department data.
Airlines also have reduced spending through such moves as eliminating free meals on domestic flights and cutting travel agency commissions, Hiles said.
"I am not surprised of the general continuing effort to reduce costs anywhere possible," Hiles said, speaking in general about the air travel industry. He said, however, that United's announcement to shed some Guam jobs was news to him.