US Air, American merger will hurt state, says Arizona economist

Nov 13, 2012, 1:37 PM | Updated: 1:37 pm

PHOENIX — Valley economist Elliott Pollack said a merger between US Airways and American Airlines will lead to job reductions in the Valley but the extent of those losses isn’t known yet.

US Air employs just over 9,200, making it the ninth-largest private employer in the state. Jobs connected to the airline brings the total employment impact to 24,515.

Pollack said the airline has approximately 2,000 jobs at its Tempe corporate headquarters. If the state loses those jobs the total impact would be 5,300 jobs when including jobs created by businesses that provide goods and services to US Airways, said the economic consultant.

“State revenues would drop by $11.4 million. County and local revenues would drop by a combined $9.5 million,” he said.

Pollack made it clear that numbers surrounding a possible reduction in flight operations, i.e. moving the hub out of Sky Harbor, are speculative but he offered one scenario.

“If flight activity is reduced about 4,600 jobs (includes indirect jobs serving the airline) would be lost and state, county and local tax revenues would drop by almost $18.5 million.”

Liz Landau, a spokeswoman with US Air, said the company cannot comment on any potential merger, but she said the airline
recently signed a five-year lease on corporate headquarters in Tempe. A hub will be maintained in the Valley.

The Tempe headquarters have 750 corporate employees.

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US Air, American merger will hurt state, says Arizona economist