With air travel down about 70 percent from last year, many carriers including United and American say they’ll be forced to cut jobs without additional aid
The worries are growing for United Airlines flight attendant Jordy Comeaux. In a few days, he’ll be among roughly 40,000 airline workers whose jobs are likely to evaporate in an industry decimated by the coronavirus pandemic.
Unless Congress acts to help for a second time, United will furlough Comeaux on Thursday, cutting off his income and health insurance. Unemployment and the money made by her husband, a home health nurse, won’t be enough to pay the bills including rent near Chicago’s O’Hare International Airport.
“I don’t have enough, unfortunately, to get by,” said Comeaux, 31, who has worked for United for four years. “No one knows what’s going to come next and how to prepare.”
Since the pandemic hit, thousands of flight attendants, baggage handlers, gate agents and others have been getting at least partial pay through USD 25 billion in grants and loans to the nation’s airlines. To receive the aid, companies agreed not to lay off employees through Sept. 30. That “Payroll Support Program” helped many stay on, and keep health care and other benefits.
It all runs out on Thursday.
With air travel down about 70 percent from last year, many carriers including United and American say they’ll be forced to cut jobs without additional aid. Delta and Southwest, two other big carriers, tapped private capital markets and say they’ll avoid layoffs.
Industry analysts say fear of air travel and businesses keeping employees close to home have brought an unprecedented crisis to the industry, resulting in cataclysmic losses. The four largest U.S. airlines — Delta, United, American and Southwest — together lost USD 10 billion in the second quarter alone.
Fewer airline passengers also means less demand for rental cars, hotels and restaurants. With demand for new planes down, airplane manufacturer Boeing has cut thousands of jobs. And with tourism down, The Walt Disney Co. said Tuesday it planned to lay off 28,000 workers in its parks division in California and Florida.
The International Air Transport Association on Tuesday lowered its full-year traffic forecast. The trade group for airlines around the world now expects 2020 air travel to fall 66 per cent from 2019, compared to its previous estimate of a 63 percent decline.
Airlines in Europe are expecting years of trouble and have acted quickly to cut jobs even as they get government rescue loans. Germany’s Lufthansa won a 9 billion-euro government bailout, but announced an additional round of cuts after a summer bump in vacation travel dwindled in September. The company has parked its jumbo jets and has plans to eliminate 22,000 full-time positions. British Airways parent company IAG has said it would cut some 12,000 of its 42,000-person workforce.
In the US, Congress has been considering a second round of airline aid for weeks, but it’s hung up in the debate over a larger national relief package. The Airlines for America trade group said a House proposal unveiled Monday raises some hope because Democrats and Republicans appear to be talking. Layoffs could be delayed if a deal is imminent.
Before the pandemic, the airlines were thriving. Planes were full, profits were fat and workers were getting big overtime checks. But come many are likely to get only part-time hours, meaning their household income could be halved. Allie Malis, an American Airlines flight attendant in Washington, D.C., also faces layoff Thursday. “At this point I don’t have a Plan B,” she said.
With early retirements and other incentives to quit, US airlines have already shed about 45,000 jobs during the pandemic, or 48,000 including cargo carriers. Government figures are only available through July, however.
While job losses in the airline industry since the pandemic could be about 20 percent of the total workforce when accounting for the next round of cuts, there are other sectors feeling even more pain, including the restaurant, bar and hotel businesses. From February, before the coronavirus took hold in the US, through August, those businesses shed nearly 5.8 million jobs, or around 22 percent of the total number employed, according to federal statistics.
Flight attendants likely will be the hardest hit if the airline layoffs come this week because there are over 25,000 of them. Pilots may not be affected as much because airlines want to avoid the cost of retraining them once they’re in a position to rehire. On Monday, United Airlines pilots ratified an agreement that the union and the airline say will avoid about 2,850 furloughs set to take effect later this week, and another 1,000 early next year.
It’s anyone’s guess when or even if air travel will recover from the pandemic and if airlines can fly through the turbulence.