Recession hit aviation industry hard, taking 11,000 Wichita jobs
10/09/2013 2:53 PM
08/08/2014 10:17 AM
A pending closure at Boeing Wichita, a deep downturn in the general aviation industry and a bankruptcy have cost Wichita thousands of jobs since the end of 2008.
At the same time, new programs at Bombardier Learjet and at Spirit AeroSystems, along with strong commercial aircraft orders, have boosted employment at those two companies.
The economic downturn that hit the nation and the state in late 2007 delivered an especially hard punch to Wichita. The recession came after three years of record deliveries by general aviation planemakers, and the order books were bulging at Cessna Aircraft, Hawker Beechcraft and Bombardier Learjet.
As the bad economics news rolled in, customers canceled orders and the planemakers cut back production and employment to match.
At the same time, companies are doing more with fewer people. They also have moved work outside their companies, including to local suppliers and to Mexico.
Local suppliers to the industry also cut jobs in the downturn as orders for parts and assemblies fell to match. Today, they report they’re busy as demand for the robust commercial aviation market continues to increase. Boeing and Airbus, for example, are boosting airliner production.
Overall, however, total employment at Wichita’s five largest aviation manufacturers hasn’t returned to pre-recession figures.
Today, the companies combined employ about 24,700 people, down nearly 11,000 employees, or 31 percent, from the end of 2008.
Overall, aerospace employment in the Wichita metro area, including suppliers, totaled about 46,400 during the late 1990s. In 2004, that number had fallen to 31,600 before climbing to 41,500 in 2008.
But by mid-2011, employment had fallen to 29,900.
Today, employment in the sector totals 30,300.
Hawker Beechcraft emerged from Chapter 11 bankruptcy protection in February as a smaller, restructured company called Beechcraft Corp. Today, it focuses on its piston, turboprop, military and after-market business.
The company exited its unprofitable business jet production during the restructuring, a move that meant a loss of about 1,100 jobs over the past year. During the downturn in the business jet market, the company cut jobs to match lower demand. In November 2008, Hawker announced the first of the job cuts, saying it would lay off 500 people as the market started to decline. Layoffs continued in 2009. At the end of 2008, the company employed 7,500 people. Today, it employs roughly 3,500. The market remains difficult. And while the past few years have been tough, officials say the company has emerged from bankruptcy well positioned for the future.
In January 2012, the community was rocked by the news that after 85 years in Wichita, Boeing had decided to close its local facility, which focuses on military work.
Programs had matured, had come to a close or were winding down with not enough business on the horizon to replace them. Since then, some employees have taken jobs with Boeing in Oklahoma City, San Antonio and Puget Sound. Others have retired. About 470 employees were laid off in 2012, followed by about 300 layoffs so far this year. The facility is scheduled to close in early 2014. In late 2008, Boeing employed about 3,000 people. In early 2012, employment was down to 2,160. Today, it employs about 1,000. Boeing notes that it will continue to have a significant presence in the city, where it is Spirit AeroSystems’ largest customer.
At Bombardier Learjet, employment is up from five years ago after falling during the downturn. That’s largely because of the new Learjet 85, Learjet 70 and Learjet 75 programs in development – plus an expansion of its busy Wichita flight test center. The flight test center tests all Bombardier aircraft, including Bombardier planes built in Canada. At the end of 2008, the facility employed 2,676, including contractors. Today, that figure totals 3,417.
Before the downturn, Cessna Aircraft deliveries were setting records, and the company was adding employees and boosting production to meet demand. At the end of 2008, Cessna employed about 12,000 people in Wichita. In November of that year, Cessna announced the first of the job cuts, saying it would cut 665 jobs as the downturn began. In January 2009, Cessna announced the need to shed another 4,000 jobs. Today, employment is about half of what it was five years ago. The market remains difficult. This year, Cessna recalled about 100 hourly workers, but in April it offered early retirement packages to employees and laid off others. It now employs 5,664.
At the end of 2008, Spirit AeroSystems, the city’s largest private employer, employed 10,400 people in Wichita. Today, that figure has increased to 11,100. That’s because the company has taken on new development programs and because Boeing continues to raise production rates on its airliners. Spirit builds parts of all Boeing commercial airplanes in Wichita, including the entire fuselage of the popular 737 single-aisle plane. Demand is robust as airlines replace older aircraft and add more fuel-efficient planes.