30 year pay difference SWA vs. Fedex

[Tycer]

Was throwing around some numbers for a 33 year career at Fedex and SWA. I used the numbers from airlinepilotpay.com and used a 5 year upgrade time at SWA to come up with 5.6mil in todays' dollars. I figured at Fedex 4 years on the panel, 4years fo on the 727, 4 years as Capt. 727, and the rest as wide capt. came up with 5.8mil in career earnings. Does this sound about right? I realize that Fedex has a retirement plan, but in terms of earnings was a bit curious. Tahnks

 

[TonyC]

Was throwing around some numbers for a 33 year career at Fedex and SWA. I used the numbers from airlinepilotpay.com and used a 5 year upgrade time at SWA to come up with 5.6mil in todays' dollars. I figured at Fedex 4 years on the panel, 4years fo on the 727, 4 years as Capt. 727, and the rest as wide capt. came up with 5.8mil in career earnings. Does this sound about right? I realize that Fedex has a retirement plan, but in terms of earnings was a bit curious. Tahnks

FedEx numbers... (Current contract)

YR 1 727 S/O - $49.86 / hr
YR 2 727 S/O - $63.96 / hr
YR 3 727 S/O - $75.67 / hr
YR 4 727 S/O - $86.07 / hr
YR 5 727 F/O - $104.47 / hr
YR 6 727 F/O - $106.78 / hr
YR 7 727 F/O - $109.12 / hr
YR 8 727 F/O - $111.52 / hr
YR 9 727 CAPT - $166.40 / hr
YR 10 727 CAPT - $168.31 / hr
YR 11 727 CAPT - $170.25 / hr
YR 12 727 CAPT - $172.20 / hr
YR 13 W/B CAPT - $202.18 / hr
YR 14 W/B CAPT - $204.20 / hr
YR 15 W/B CAPT - $206.24 / hr
through Year 33

Total of hourly rates (including 19 years at the Year 15 Widebody Captain rate) is $5,709.55

MINIMUM Bid Line Guarantee is 68 hours in a 4-week bid period, 85 hours in a 5-week bid period. We typically have 8 4's and 4 5's in a year, giving a minimum for a year of 884 hours.

884 * $5,709.55 = $5,047,242.20

A more realistic number of hours to expect might be 950 in a year.

950 * $5,709.55 = $5,424,072.50

Short of working an extra day EVERY month for your entire 33 year career (I'm in favor of early retirements, by the way )I'm not seeing how you arrived at $5.8 million, but I didn't work the SWA numbers, either. You may have made a similar computation that makes the comparison still valid.

Your mileage may vary...

 

[Falconjet]

2 Answers!

Answer number 1:

Looking back at my 6 year old AirInc data, the comparison would be as follows:

30 year earnings summary

FDX: $8.4M SWA: $5.9M


35 year earnings summary:

FDX: $10.6 SWA: $8.1M

Keep in mind, those are old numbers and they include the value of the retirement funds at FedEx. Present day dollars (1998) and a bunch of other criteria that AirInc used at that time. Even still, it appears that your numbers might be kind of on the low side.


Answer number 2:


I just went through a very similar analysis for myself using 18 years at FedEx and 16 years at SWA while trying to decide whether to accept my class date at SW this month after having been at FedEx for almost 2 years.

For my analysis I used current contract amounts, current dollars only, and assumed 5 years on the 727 panel, 4 in the right seat, and the last 9 in the left seat of the 727. Pretty conservative career progression for FedEx. At SW I assumed 1 year on probation pay, 7 more years in the right seat, and the last 9 as a Captain.

I compared the salary and B fund at FedEx with the salary and 401K match at SW and the numbers came out at $2.68M at FedEx and $2.69M for SW. They were within 8000 bucks! Most folks around here say that I will make it to a widebody at FedEx, but I consider that a long shot and I might not want to give up my quality of life to be junior in a widebody seat, so I stuck with the narrow body pay scale.

The big difference is the retirement benefit. I took those same conservative upgrade and earnings averages at FedEx and calculated that my retirement will be worth $70K per year. If I live to be 75 (ave life expectancy for a 43 year old male) my retirement will be worth just over a million dollars. If I live longer or am able to make more during my high 5 years, it will be worth more. Hopefully it will still be around in 2020 when I can retire, who knows about that.

SW is about to get a 13% pay raise and we are in the middle of contract negotiations so hopefully we will have some increases as well. I didn't take either of those variables into account. You can argue that you can work more and therefor make more at SW, but again I wanted to just compare as best as I could the "normal" work hour amounts. (SW trip pay were converted to hourly) Plus you can work extra a FedEx as well, so that is a variable I just didn't want to try to account for.

Of course, the night flying at FedEx will likely take its toll on my body over all those years, so who knows if I will be able to ever collect that retirement. I'm betting that I will be around for some of it since I decided to stay at FedEx. You could make similar comparisons with the vacation but I just figured with almost 2 years worth of "seniority" I'd better stay with FedEx and try to use my vacation and sick time wisely so I don't burn myself out.

I'll let you know in 2020 how close my numbers came out.

Best of luck to you.

FJ

 

[NightFlyer]

Tycer,
Both companies are great companies and have a good chance of being around when you retire. The money is going to be good at both but you need to think about what you want out of your career. Personally, I wanted to fly the biggest thing that I could get my hands on so FedEx worked for me. Some other pilots could care less about ever flying a widebody so Southwest works better for them. I have several friends that fly for WN and they absolutly love it. They cringe when I talk about sitting in an airplane for 12 hours flying over the ocean. I love it, so what ever floats your boat. Good luck to ya.


NightFlyer

 

[FoxHunter]

A few years ago I flew a trip from OAK to EWR. We had a jumpseater, an AF buddy of the F/O. The jumpseater was a SWA Captain. This SWA Captain was trying to get a job with FedEx. Why we asked? He said "I fly 6 legs a day, 90 hours a month, be flying the same airplane twenty years from now, and have the Jerry Springer crowd in the back. On top of that the previous year he had earned $40,000 less than my F/O.

 

[Falconjet]

Old stories

FoxHunter: You hear lots of old stories like that from lots of old (senior) guys at FedEx who are constantly trying to prove to themselves and their crew that they are better off at FedEx than anywhere else. And when you are as senior as you are, that is probably true. But those old stories are just that, old, and mostly stories.

You need to look at the current pay scales and see that SW pays pretty darn well and there are lots of folks at FedEx who (like me) will probably never get into a widebody either. And the 6 legs a day every day isn't the norm at SW necessarily either (another common refrain at FedEx about SW) and many of the trips the riff-raff like myself have to fly in the 727 are 4 legs a night, in beautiful places like Cedar Rapids and Grand Forks.

People studying their options want to look at the numbers and make valid comparisons, not hear the same old stories I have to listen to every day on the line at FedEx.

Very respectfully,

FJ

 

[Tycer]

This is good stuff, now what if you also were in a guard unit in the south?

 

[NightFlyer]

Falcon,
I'm kinda curious why you'll never be in a widebody since we have more widebodies than narrowbodies. Do you think you'll never hold it or are you saying that you are going to stay in the 727 by choice?


NightFlyer

 

[Falconjet]

Good question

Night Flyer: From the movement I've seen here (or lack therof) I am just trying to keep my expectations in line. I am afraid that because of my age I will not be able to get into the left seat of a widebody with enough seniority to make it worth the leap. I'm planning on about 4-5 years in the back of the Boeing, perhaps another 4-5 in the right seat of something, and that only leaves me about 8 years to get in the left seat of something.

I don't see me ever getting senior enough to hold Capt in a widebody without pounding it out at the bottom of the reserve pile for the entire time before I hit 60. I have to do it now, and probably for another couple of years, but I don't think I would chose to do it that far down the road. I don't have any particular desire to fly the widebodies per se, but I would like to fly some newer, more automated equipment and it looks like our only option there will be the MD-11 or the Bus, for the time being. I don't think I'll ever even get a whiff of the A-380.

Who knows, if we start hiring and the guys keep retiring, maybe things will move quicker than I estimated, and I will be pleasantly surprised. I hope so, but I'm not counting on it.

I'm not complaining, I'm happy to be here and obviously think that this is the best place for me.

FJ

 

[1-tacan-rule]

FJ

of course, for you....I'm sure anything is better than still being in the Coast Guard.

 

[TonyC]

Re: Old stories

FoxHunter: You hear lots of old stories like that from lots of old (senior) guys at FedEx who are constantly trying to prove to themselves and their crew that they are better off at FedEx than anywhere else. And when you are as senior as you are, that is probably true. But those old stories are just that, old, and mostly stories.

...

People studying their options want to look at the numbers and make valid comparisons, not hear the same old stories I have to listen to every day on the line at FedEx.

Very respectfully,

FJ

Falconjet... I may have missed something, but it sounded to me like FoxHunter was using the first person narrative to recall the "story," as in "I" flew a trip, "we" had a jumpseater, and "we" asked. To imply that this was a fabrication is to imply that FoxHunter is being untruthful. Is that what you intended?

I mean, the "story" doesn't sound all that far-fetched to me.

 

[Gumbydammit]

Can someone please explain to me why flying multiple legs in a day is so terrible....as far as I see it, that means more actual flying...meaning more takeoffs, approaches, landings and less time on your arse....of course I realize that you're not making money when you're on the ground. However, isn't flying more dynamic, more interesting, more fun...I mean if you fly one 12 hour leg to Singapore or something and that's you're day, you don't even get a leg...is that better than getting two or three? I wouldn't think so...at least at this point in my life. I don't know how I'm going to feel later, but if flying more is going to make me unhappy and I'm going to prefer as little as possible by the time I'm in my fifties, that depresses the he11 out of me. Is that really how a majority of guys out there feel? Do most guys not enjoy flying afer you do it week in and week out as a job for several years? If that's the case, maybe I need to rethink this airline thing and go get a real job and fly as a hobby on the side...I thought the whole point of being an airline pilot was getting to fly for a living vice sitting at a desk shuffling paper or whatever the rest of the world does every day....am i wrong?

 

[Vikingpilot]

Nothing wrong with more flying...if that's what you like. I think the point is about choices. SWA has one type of business, one jet, only domestic. FDX offers choices...international/domestic, day/night, wide/narrow that's the main difference when it come to flying. You chose your cup of tea. Nothing more than that.

 

[canyonblue]

They cringe when I talk about sitting in an airplane for 12 hours flying over the ocean.

I cringe when I have to fly the MHT-LAS (6:00 Block) each trip this month. The only good part is that I am done at 10AM so I can go gamble the kids college money. All my 3 days this month had 7 legs total for the trip, not bad.

 

[sfomarc]

Like others have said it comes down to personal choice and priorities.

My priorities are quality of life, seniority, pay and time off. Flying is still fun but playing golf or laying out on the beach is more fun. I would have liked to have flown internationally,had long overnights and had a big retirement plan but not at the expense of quality of life.

Different strokes...

 

[Snoopy58]

Good discussion!

Couple observations:

In the recent (4-5 years ago) past, people HAVE left SWA for all sorts of places, for all sorts of reasons, some of which look pretty bad in hindsight, but a few of which look really good. If Jet Blue does well, having left SWA to be in the top 20 pilots at JB would be a good choice for a lot of people, since that translates into top few % of the seniority list for the balance of your career. Nice when things work out that way. Similarly, the top some % at FedEx did far, far better there than they could have virtually anywhere else. Also the first group of pilots at SWA. If you have that sort of opportunity (and you know it'll pan out!), great. But if you're looking at established airlines like FedEx & SWA, realize that your tradeoff is less risk but you won't have 20 years in the top 10% of your airline!

As has been pointed out, 6-8 legs/day at SWA is far less common than it used to be. If that's your thing, go to Texas & fly the -200 (until they retire in January -- but it'll still be lots of short legs, also in California up & down the coast); if you like long hauls, BWI & MCO have lots of 'em. If you want trans-oceanic, well, you probably don't want SWA.

Analyzing something as complex as a career in the airline industry has all sorts of opportunity to see assumptions, even about small things, have tremendous ability to influence the outcome. For SWA, profit sharing is one such deal. Many people choose to put their profit sharing account (historic average, 10% of previous year's pay) into SWA stock. If the stock does well, your P/S account is huge -- millionaire ground ops agents, etc. If the stock sits like it has the last year or 2, well, the P/S isn't so great. Likewise your 401k investments... how much do you project they'll grow? How about options -- they've come with each contract so far; some people got quite rich off of them, others not so much. Then there's your crystal ball about future contracts... new pay rates, new plans for retirement, etc. And projected future growth (HUGE impact on pay, quality of life, everything). Oh, and what discount rate do you use to bring it all back to Net Present Value???

My point of all those uncertainties is this: you can't know with high precision. When the numbers are coming out as close as the analyses above show, I think the best conclusion you can draw is that the two opportunities are VERY comparable, and which one will do better for you will be determined by events in the future that can't be accurately foreseen.

Sure, if one calculation came out to $2M, and the other to $6M, that's pretty clear. But $5M vs $5.5M over 20 years, that's within your margin of error. Probably WELL within.

So decide based on other things... what type of flying appeals to you, where you want to live, etc. And realize that at the end of the day, even when one choice is the BEST one for you, that doesn't make the other one a BAD choice. I'm very happy where I am, but if this gig hadn't worked out & FedEx had offered me a job at the same time, I wouldn't have wasted any time saying yes.

It's a choice between two excellent options.

 

[milplt]

Snoopy has it right with saying that there are too many uncertainties to think that an accurate analysis can be made. These are good questions to ask (everyone is curious as to what they will earn at their carrier), as long as you keep in mind that the answer is just a big wag. Obviously, make the choice that you think fits your family, commuting lifestyle, etc. Back in the summer of '01, I asked a buddy who flew for United why I needed to fly for United vs. the other carriers (I wanted to hear the good things about his carrier). He told me to screw that, go for the one that hired me first - that's what he did. Well, he's furloughed now. Before the furloughs, first in meant more seniority, more earnings, etc. Turns out that things changed, there are some dudes who went to Southwest that may end up earning more than their counterparts at United or Delta over the long haul depending on how long it takes to get called back. If you make a choice to fly for a carrier that doesn't suit your lifestyle based solely on earnings, and those earnings don't pan out, how happy will you be? If you choose the carrier that keeps you engaged in your work because you enjoy it and it fits your personality and the earnings fall a little flat, will you be as upset? I think that everyone knows this, but sometimes we get buried in the details.

 

[TexaSWA]

Re: Re: Old stories

Falconjet... I may have missed something, but it sounded to me like FoxHunter was using the first person narrative to recall the "story," as in "I" flew a trip, "we" had a jumpseater, and "we" asked. To imply that this was a fabrication is to imply that FoxHunter is being untruthful. Is that what you intended?

I mean, the "story" doesn't sound all that far-fetched to me.

This story was in a post years ago with the old SWA pay scales. Look at the narrow body scales now. (from airlinepilotpay.com)

SWA FO hourly yr 1 - 5 $47, 80, 89, 98, 107
FDX FO hourly yr 1 - 5 $50, 96, 100, 102, 104

SWA CA yr 6 - 10 $167, 169, 171, 173, 175
FDX CA yr 6 - 10 $164, 165, 166, 166, 168

Its obvious the FO making 40k more than the capt is a little "far fetched" as you put it. Looks to me that the pay is roughly equal on the same type of equip, with a slight SWA advantage. Granted there is no higher payscale to bid at SWA unless you count the ability to move to the Capt. scale after 4 or 5 or maybe 6 years.

Point is pay is good. Do you want to fly pax or cargo? There is good and bad in both.

 

[Falconjet]

Take Two

I kind of thought this thread had died, but I'm glad to see that it is still alive. I agree with Snoop, Milplt and Texas, and I sure didn't mean to imply that I made my decision based on the money. I did the analysis for me so I could at least make my decision with my eyes (and my wife's) wide open about the possible financial implications involved. The fact that the numbers came out so similar was interesting, and made it easier to base our decision on other issues that were important to us. I just thought that since Tycer asked the question about the pay and I had just run some numbers that he would be interested in them.

My point about the story of the jumpseating SWA Captain was kind of like Texas said. I've heard several versions of that story in the first person from several different pilots in just the short time I've been at FedEx, and I guess the more they tell it the more they believe it to be true, or maybe that it really did occur in their cockpit. Thats fine, but if you simply look at the numbers today, you can easily see that there is no way that a widebody FO at FedEx is going to make $40K more than a SWA Captain with normal amounts of work by each pilot.

FDX Widebody FO pay

YR 5 122
yr10 136

SWA Capt Pay (before 13% raise)

YR 7 169
YR10 175

So although this story sounds good and may help some guys feel better about the fact that they decided to go with FedEx instead of a pax carrier, it just doesn't hold water, no matter how many times it gets repeated.

SW's pay is very competitive in today's market and while all of us would like to see that market rise, the fact remains that until the legacy carriers start to make a profit and grow, the pay rates will likely trend downward. As that happens SW's pay will look even better.

I'm hoping that everybody's pay starts to come back up as the economy improves, particularly for all of us hard working boxhaulers in Graceland.

FJ

 

[Mooseflyer]

GREAT post Snoopy - really puts things in perspective (which is exactly what I need right now). Thanks......