To get back to the topic.
Under regulation the airlines and the pilot groups devised a neat little formula for calculating pilot pay rates. This formula was pretty much an industry standard. Two factors in the formula were normally number of seats and aircraft Take-Off Gross Weight. Then the problem appeared, the 747. Up until that time the biggest aircraft flying commercially weighed about 350,000 pounds, now there was introduced an aircraft weighing in excess of 700,000 pounds. On the face of it a 100% pay increase. Great for the pilots, not quite so great for the employees but not a disaster since, under regulation, they could pass most of the increase in pilot costs straight on to the passenger. And do not forget, the increased number of seats on the aircraft did improve productivity so to some extent the old argument still held. Pay me more for being more productive. Along with the 747 the new generation of mini-jumbos appeared, the DC-10 and the L1011. The top end pilot pay checks increased nicely and the pay checks on the smaller aircraft did not do too badly either. Pilot pay in the whole industy rose. Only "major" airlines existed. The only pilot progression was to join at the bottom of a major and know you had lifetime job security unless you screwed up. Sit back, don't rock the boat and enjoy your first class crew-meal (Ha! Those were the days. "Excuse me Captain, How do you want your roast beef? Will you be eating on the Flight Deck or in First Class?").
It is this immediate pre-deregulation era that provides the baseline for the present pilot salary situation. However, I must point out something which all of the posters on this sight seem to forget. In terms of adjusted dollars and cost of living increases airline pilots are now paid LESS per pound of aircraft weight than they were in 1978. Pay check dollar figures have increased to where they look quite impressive but consider also the cost of houses and cars. Pilot pay checks have not maintained their relative value. Nobody says they must do that, of course, but it is a factor to be considered and is usually ignored.
Deregulation introduced ticket competition between the airlines where it had been non-existent before. It also introduced start-up carriers. At first, the start-up carriers were viewed as potential major airlines, competition for the majors. This view soon proved too optimistic despite political interference (every politician wanted a start-up in his own community, presumably to buy local votes and make it easier for him to get to work.). It took many years before viable start-up airlines appeared and stayed in the market.
Now pilots had more career progressions open to them. Most still wanted to join a major carrier because of career and financial benefits. However, pilots that had for some reason failed to get hired by the majors or had personal reasons for not wanting to join the majors had a place to go. The down side was that the start-ups paid less than the majors. Therefore, for a significant number of pilots the start-ups were a means to an end. It was a way of getting airline experience before applying to and moving on to the majors. The situation was fairly stable. The major carriers paid the high paychecks and basically did OK in business. The small carriers paid less but were OK if you diid not want a job with the majors or could not apply to them because of age etc.
Then came the dramatic changes in the late 70's early 80's. The first blow was a serious increase in fuel prices, which had been threatening for some time, arranged by OPEC. The second blow was internal. I will give you just the names and you will know what I mean. Continental, Eastern, Pan-Am, Lorenzo, Ferris, that is enough. Under the new deregulation profit became the name of the game. From a business sense that is perfectly reasonable but for the pilot group it caused chaos. Neither the pilot group or the airlines had ever seriously had to fight over paychecks before. The result was a very messy few years in the airline industry, bankruptcy, strikes and much conflict between airlines and employee groups where there had been none before.
One way or another the aviation industry weathered these storms. However, what did not go away was a new sense of, in many cases, bitter mistrust between airlines and employees. No longer were pilot pay checks be subject to the old formula. Every dollar in pay or item of benefits was bitterly fought over. It is the result of this bitterness, this adversarial relationship and mistrust, which we are seeing now in the industry causing so many problems.
So what we are left with is a tradition of well paid pilots in an industry that is increasingly cost concious. Will pilots ever be valued for what they contribute to their airline? The answer is clearly no. It is just far too difficult to calculate what a pilots contribution is worth. For example, you can measure how much fuel a pilot uses to fly between A and B and compare it with his fellows but can you be sure the operating conditions were the same on the two occasions? Is fuel usage a valid criteria? If a pilot uses less fuel than his fellows for a year then diverts on one occasion because he was short of fuel did he actually save the company money in the long term?
The contribution a pilot makes to the company on a day to day basis is not quantifiable in abstract terms. How efficient he is, how safe he is or how hard he works. What do we have left then? One view would be to ask whether he gets the job done as assigned. A fairly crude measure of his contribution but, after all, that is what he is being paid for, getting the job done as assigned. If he gets the job done as assigned he is a good guy if not he gets retrained or fired. But how much do you pay someone who is "just good enough"? Do I really need a captain who has thirty years of AIRLINE FLYING flying on my 747 when a twenty year OLD fellow desperate for a job would do just as well? You can argue that when things go seriously wrong you would be happier behind a thirty year experienced fellow but can you prove that on a bean-counter's spreadsheet? No. Except in very limited areas where experience can be shown to significantly effect the bottom line it is not possible to LOGICALLY justify what a pilot pay check should be. It is not possible to LOGICALLY justify pay depending on seniority. It is barely possible LOGICALLY to justify pay based on productivity (in fact, some airlines have gone away from this idea).
So what, after all these considerations are we left with? Forte main, the strong arm. Airline management wants the lowest pay check. They know that they cannot go as low as they would like, rock bottom, because they feel, more by intuition than facts that they would be getting themselves into deep water if they needed to replace too many experienced pilots at one time. Training costs could escalate, disruptions would occur during the change over, an accident at the wrong time (for any reason) would surely reflect on them with serious legal implications. However, they can easily tell when it is an opportune time to squeeze the pilots pay check. On the other hand pilots would like to see the highest possible pay check but pilots too see the reality of the situation. They are still within their rights to go for the best deal they can get.
After all, the best way to establish pilot pay checks is free negotiations. Look at it either way. When times are good in the business and supply of pilots is low you can expect pilots to ask for the moon. On the other hand, if pilot supplies are high and companies feel they can justify the confrontation then expect to see pilot pay checks fall. What is entirely wrong is for people outside of the airline and pilot group to criticise the contract between the pilots and the airline. Both sides are consenting adults. If you approve of the other thing why criticise the sides in a contract settlement? Both sides in a contract accept what they have agreed. They might not like it and they might wish it was different but their value judgement is that they can live with what they are signing for, otherwise they should not sign. It is fine for either side to claim circumstances have changed and the contract needs to be changed but for either side to say they did not know what they were doing or that they were "forced" to do something is pure horse manure.