Go to the mobile version of this Web site.

Login | Contact Us | Site Map | Paid archives | Alerts | Electronic edition | Advertise | Subscribe to the paper | Today's Extras

Breaking News:

Subscribe

Aircraft makers' layoffs hit hard

Multiplier effect hurts other area businesses

By Chris Walsh, Rocky Mountain News (Contact)

Published February 27, 2008 at 12:05 a.m.

Text size  
Laid-off employees of Adam Aircraft pick up job leads and information at a workshop sponsored by the state Department of Labor and Employment.

Photo by Dennis Schroeder / The Rocky

Laid-off employees of Adam Aircraft pick up job leads and information at a workshop sponsored by the state Department of Labor and Employment.

The Adam Aircraft main building near Centennial Airport sits empty, with one sign on the door telling employees that their last check will be mailed to them and another sign containing information about a workshop.

Photo by Dennis Schroeder / The Rocky

The Adam Aircraft main building near Centennial Airport sits empty, with one sign on the door telling employees that their last check will be mailed to them and another sign containing information about a workshop.

More Airlines & Aerospace

More stories »

Peppino's Pizzeria & Restaurant in Centennial lured plenty of Adam Aircraft employees over the years with its lasagna, meatball subs and New York-style pizza.

But you'd be hard-pressed to find any of those workers nestled in the restaurant's booths these days.

Adam Aircraft recently laid off more than 650 employees in the area before plummeting into Chapter 7 bankruptcy. The company's workers accounted for "at least" 5 percent of Peppino's lunch rush, said Frank Cammarota, one of the restaurant's owners.

"I can tell you for sure that it is already affecting us," said Cammarota, whose restaurant is just down the road from Adam Aircraft's headquarters. "We used to get their workers in here during the day. The company also would place orders with us for 10, 12 pizzas sometimes. All of that is gone."

Numerous businesses in Centennial, from pizza joints to sports bars to aviation support companies, are feeling some pain from roughly 750 layoffs in less than three months.

Aside from Adam Aircraft's demise, fellow plane manufacturer Aviation Technology Group shut its doors in December and sent dozens of workers home.

The companies, both based at Centennial Airport, had grown quickly in recent years, developing new types of jets intended for companies or wealthy individuals. That led to rapid employee growth, creating revenue for businesses as those workers dined at local restaurants, grabbed drinks at area bars and filled up their cars at nearby gas stations.

Both companies, however, flamed out rather rapidly, ceasing development of their planes within a few months of each other after failing to secure financing.

Adam Aircraft and ATG could gain a second life if investors provide last-minute funding or acquire their assets, which could put some employees back to work.

But the companies' struggles are trickling through the region as workers who lost their jobs cut back on spending until they find new positions. Several workers even said they are considering leaving the state for jobs elsewhere.

"We get a lot of people who work at or near the airport, including some from those companies," said Jeff Omvig, co-owner of Indigo Joe's Sports Pub & Restaurant, located near Centennial Airport. "It's hard to say just how much it has affected us, because business is slow during this period anyway. But, yes, it has had an impact on our business."

Centennial Airport itself will lose out on fuel sales and rent, though officials expect the overall impact on revenue to be minimal. Adam Aircraft and ATG also leased hangars and other space from private individuals who will now have to find new tenants.

In addition to the direct job losses, economists say the moves could result in perhaps 1,400 or more job cuts in the metro area at businesses that directly or indirectly gleaned revenue from Adam Aircraft, ATG and their employees.

"The aviation industry as a whole does have some very large impacts on the metro Denver area, so the layoffs will be felt in little ways across the region," said economist Patty Silverstein of Development Research Partners in Littleton.

In some cases, the effects are being felt miles away.

ATG, for instance, had planned to manufacture its jets at Front Range Airport in Watkins and eventually employ hundreds of workers there. It had leased two hangars at the airport in anticipation of the growth. The company, however, has dropped the lease on one of the hangars. It is still paying the lease on its other hangar there in case it can line up some financing, but its growth prospects have diminished significantly.

Front Range Airport isn't taking a direct financial hit, but it could miss out on future potential if ATG can't stage a comeback.

"The loss for us is a future loss," said airport director Dennis Heap. "ATG's growth here would've been considerable, but we might not get those jobs in the end."

Additionally, many of the laid-off workers live outside Centennial in places such as Arvada, Denver and Aurora, meaning the effects will be felt in those areas as well.

"Obviously, it hurts the communities where the companies were doing business," said Jeff Thredgold, an economist with Vectra Bank Colorado. "But it also hurts the communities where these employees live and (spend their money). There's a multiplier effect with any job losses."

Elizabeth resident Gary Dickens, for instance, has cut his spending since losing his job at Adam Aircraft as a logistics supervisor, and he's considering selling one of his two cars.

Robert Scoggin, who was an assembly technician at Adam Aircraft, scaled back his hours at a nearby flight school and is considering packing up and moving from Arvada to Ohio.

Brandon Baca and his former colleagues, Sean McGeeney, Brian Gass and Josh Coleman - all laid off from Adam Aircraft - said they've tried to cut back on going out to eat and in other ways.

"I don't go to the bars as much, because that gets really expensive," Baca said. "Gas is a big one, too."

The layoffs, however, certainly haven't rippled to all businesses in the area.

The Diamond Shamrock near Centennial Airport has actually seen an increase in business thanks to an increase in the number of construction workers on nearby projects.

And the Perfect Landing Restaurant at Centennial Airport is busier now than it's ever been, primarily because it's drawing an increasing number of residents rather than just those who work at and use the airport.

walshc@RockyMountainNews.com or 303-954-2744

Layoffs at two plane makers

650 Adam Aircraft employees were laid off when the Arapahoe County-based company shut its doors and filed for Chapter 7 bankruptcy.

100 employees at Aviation Technology Group, all but a skeleton crew, were laid off when the Arapahoe County plane manufacturer ran into funding issues. The company is still trying to salvage its business.

Comments

  • February 27, 2008

    10:52 p.m.

    Suggest removal

    familynurture writes:

    Everyone in the family is affected by job loss. Having gone through three layoffs it is important for family to have a plan of survival in order to survive emotionally intact.Watch out for the complex components that each member of the family faces.Read about what our family learned at www.quietmysoul.com. H. Jones

Post your comment

Registration is required. Click here to create your free user account, or login below.

Comments are the sole responsibility of the person posting them. You agree not to post comments that are off topic, defamatory, obscene, abusive, threatening or an invasion of privacy. Violators may be banned. Click here for our full user agreement.




(Forgotten your password?)




News Tip

Know about something we should be reporting? Tell us about it.

Sponsored links



Reprints