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American's Cuts Hurt Temerlin

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Sharply reduced ad spending by American Airlines has forced Temerlin McClain to cut 75 employees.

The agency layoffs are the third in a series of personnel cutbacks this year.

The Irving, Texas, shop had already discharged more than 130 staffers earlier this year, based on the loss of its Verizon wireless account and reduced spending by Nortel Networks.

Additionally, Temerlin had implemented a 5 percent pay reduction for staff members.

Now reverberations from the national tragedy of Sept. 11 have hit the agency hard, with client American Airlines cancelling most of its advertising plans through the end of the year, sources said.

Client officials could not be reached for comment.

Temerlin chief executive officer Dennis McClain and other top officials did not return phone calls seeking comment.

An agency source who spoke on condition of anonymity, confirmed that 75 staffers have been let go. Although the cuts are directly related to American Airlines, personnel across the board were affected.

Said the source, "They left the core of the American team in place because they want it to be in place when [American's spending] comes back."

The agency layoffs took place the same week that Fort Worth, Texas-based American Airlines announced 20,000 job cuts.

The total number of employees now at Temerlin remains in flux as the agency attempts to integrate former staffers of the McCann-Erickson Southwest office in Dallas. The process, scheduled to be completed this month, was originally going to bring the workforce total to 490, with about 75 coming from the McCann side.

Ironically, the carrier bowed an "American's getting back to business" campaign from Temerlin last week. Full-page ads ran in more than 20 major metro newspapers, including The Wall Street Journal and USA Today. The airline offered 25-50 percent discounts on coach fares and lifted its Saturday night stay requirement. It also expedited award redemptions and announced the return of Internet specials.

Now that the print campaign has broken, the agency is in a holding pattern, waiting to see what new work—if any—will be forthcoming from what has been its largest client.

"They're taking it day by day," the source said of Temerlin's officials. "I don't think there's a master plan."