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AIRLINES
American Warns of Job Cuts
American Airlines expects to eliminate about 8 percent of its workforce, or nearly 7,000 jobs, when it reduces capacity in the fourth quarter to cope with soaring fuel costs, the company said in a message to workers.
The Fort Worth airline said it could cut 900 flight attendant jobs and will probably reduce jobs for pilots and mechanics, too, but it hasn't released numbers, yet. In May, American announced it would cut domestic capacity by as much as 12 percent this year, retire some planes and cut an unspecified number of jobs.
In a regulatory filing, American's parent AMR said it will record costs of $1.27 billion to reduce the value of parked aircraft and pay severance to workers who lose their jobs.
AirTran Looks to Cut Workers' Pay
Discount carrier AirTran Airways said it is seeking to cut employee pay by about 10 percent to help offset soaring fuel prices, and it warned that it may cut wages further.
"Our plan is to temporarily reduce pay rates for six months commencing with the start of the August pay period, and we will then review the situation again," chief executive Bob Fornaro told employees in a memo.
REGULATORS
Paulson Makes Case for Reform
Treasury Secretary Henry M. Paulson Jr. said the United States must build a tougher regulatory system that can allow financial institutions to fail without causing wider economic turbulence. In a speech in London, Paulson said the U.S. Federal Reserve needs sweeping new powers that would make it easier to get information on financial institutions -- and to intervene if necessary.
Paulson warned that major global markets must root out the perception that some financial institutions are too big, or too complex, to fail. Markets need to be robust enough to withstand the collapse of a major firm, with government intervention an unusual act, he said.
CONSUMER SAFETY
Kroger Expands Beef Recall
Kroger expanded its voluntary recall of some ground beef products beyond stores in Michigan and parts of Ohio. Meat from one of its suppliers, Nebraska Beef, has been linked to illness caused by E. coli in Michigan and Ohio from May 31 to June 8. Nebraska Beef has recalled nearly 532,000 pounds of ground beef produced on five dates between May 16 and June 24.
LABOR
