American and United airlines laid off 40,000 workers Wednesday, responding to a dramatic drop in passenger traffic after last week's hijackings of four airliners that ended in terrorist attacks on New York and Washington.

        Employees at airlines and airline suppliers in Greater Cincinnati, including Delta and Comair, could soon be among the collateral damage from the attacks.

        Following similar announcements from Northwest and Continental airlines this week, American and United airlines said Wednesday that they would lay off 20,000 workers each, the most confirmed so far. It's unclear how many from the 850-worker American call center in downtown Cincinnati or from locally based flight crews would be affected.

        Massive cutbacks at U.S. carriers and in related industries are expected to help push the nation's unemployment rate to 5.5 percent by early

        2002 — the highest rate since July 1996. Economists had projected a 5.0 percent jobless rate before the attacks.

        “We've already seen layoffs in a number of industries because of the attacks,” said Steven Wood, chief economist at FinancialOxygen Inc. in Walnut Creek, Calif. “... There are going to be additional layoffs.”

        Since hijackers crashed the four U.S. airliners, carriers already have announced more than 69,000 job cuts, along with a 20 percent reduction in flights. Some estimate that 100,000 airline jobs eventually will disappear.

        Airlines are pinning their hopes on a federal aid package and have asked for $17.5 billion in help.

        President Bush will ask Congress to give the nation's beleaguered airlines $5 billion in immediate cash aid plus significant help with their insurance liability — but not, for now, the loans the industry says it needs to avert bankruptcies, an administration official said Wednesday.

        Even before the attacks, airlines were suffering through a soft economy; experts were projecting industry losses of $2.3 billion for this year.

        Cincinnati's largest carrier, Delta Air Lines, hasn't announced layoffs — yet. Delta's chief executive Leo Mullin has said the airline will consider cutting jobs, 4,000 of which are local, without enough government aid.

        The airline carried just under 100,000 passengers Tuesday, when it usually would have seen as many as 250,000.

        Delta's Erlanger-based subsidiary, Comair, which also employs 4,000 locally, has said job cuts are a possibility. In an internal memo Wednesday, Comair president Randy Rademacher told employees that the commuter jets are only 30 percent full, half the loads expected at this time of year.

        “At this point, no staff reductions are planned, and we will do everything we can to avoid workforce reductions,” Mr. Rademacher wrote.

        “The financial situation facing all airlines, including Comair, is truly grave,” he said.

        But Standard & Poor's DRI chief financial economist David Wyss said the cuts in the tourism and hospitality industries will be much more devastating. Restaurants and hotels employ many more people than airlines.

        “I'd venture to say that Marriott will lay off many more nationally, but they get laid off at the individual hotels so they don't get added up,” Mr. Wyss said.

        Because many airlines also are shelving plans to buy new planes, Boeing Co. said it will fire as many as 30,000 employees. Honeywell International, which makes electronics for airplanes, said it will fire 3,800 more people than previously planned.

        Evendale-based GE Aircraft Engines, the largest jet-engine maker and one of Boeing Co.'s biggest vendors, Wednesday said it is continuing to evaluate the deteriorating market, but hasn't made any decisions about job cuts. GEAE employs more than 8,500 in Greater Cincinnati.

        That hasn't stopped speculation from swirling around GEAE's operations that it could be facing cutbacks of up to 25 percent in the near future.

        The uncertainty extends to companies that supply components to either GEAE or Boeing.

        “Right now, we're waiting to see what's going on,” said Jerry Flyr, vice president and general manager of Meyer Tool Inc., a Camp Washington machining company that employs 530 and supplies turbine components to GEAE and other engine makers.

        “There's just nothing firmed up yet on what's going to happen. But we know something is going to happen.”

        In the meantime, Meyer Tool, which relies on jet engine makers for about 98 percent of its business, isn't cutting back.

        Likewise, Sermatech-Lehr, a Blue Ash supplier to GEAE and rival Pratt & Whitney, said it's not been told to cut back deliveries.

        “I think GEAE and Pratt don't know the impact of (Boeing's cut backs) yet. When they do, they'll pass it down to us,” said Michael Brand, president of the unit of Sermatech International Inc., which employs about 400.

        Machine tool builders such as Oakley-based Cincinnati Machine, a major supplier of equipment to Boeing and other aircraft makers, have been coping with a depressed market before the Sept. 11 terrorist attacks.

        Kyle Seymour, Cincinnati Machine president, said machine tool builders had been pinning their hopes on a recovery next year. But Boeing's planned cutbacks will probably mean that any machine tool recovery will be pushed back another year.

        Mr. Seymour said Cincinnati Machine's aerospace business has held steady this year thanks to orders from European customers building components for Airbus Industrie's superjumbo A380 jetliner. He said planning on that jetliner project should continue despite the current market.

        “Before we make any changes, we'll want to see what our other customers are doing,” he said.

        A buildup in military procurement triggered by the Bush administration's response to the terrorist attacks could offset some of the declines in the commercial aviation business, say local suppliers.

        Meyer Tool's military customers “are asking us to get ready for a surge (in orders), but there's nothing definite.” said Mr. Flyr.

        A-Carb LLC, a Richwood-based unit of French aerospace company Messier-Bugatti, hasn't been notified of any cutbacks, said Pat Haywood, operations manager.

        A-Carb, which employs 71, produces aircraft carbon disk brakes to Messier, a unit of Snecma SA, which supplies brakes and landing gear to Boeing and rival Airbus.

        Messier recently designated A-Carb, which opened two years ago, to produce carbon disk brakes for Boeing's C17 Globemaster air transport.

       Enquirer reporter James Pilcher and Bloomberg News and the Associated Press contributed to this report.
       

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