The airline industry is bracing for mass layoffs as federal funding from the CARES Act expires
The airline industry is bracing for mass layoffs as federal funding from the CARES Act expires.
In March, the CARES Act relieved the airline industry with billions of dollars in federal grants and loans. It also provided temporary support for workers as the demand for travel across the world diminished due to the coronavirus pandemic. And without more funding from the federal government, the industry could suffer.
Commercial pilot Jeremy James has been a regional airline captain for nearly six years, but his job may be on the lines
“I got my warning letter about a month and a half ago, and that was just to give us a 60-day notice that, look, we might be getting furloughed based on the current situation,” James said.
Thousands of industry workers are in the same position as James. American and United airlines say they could be forced to lay off 32,000 workers combined unless Congress approves additional federal funding.
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“I was shocked. When I came into the industry it was on the up and up, everyone was talking about how there was a pilot shortage so there’s going to be a need for pilots. I’ll say it was definitely a wakeup call that anything can happen,” James said
Although airlines have put in place multiple safety protocols, passenger volume is still down by 70%. Even pilot instructors like Jonathan Boyd are feeling the impact as the industry continues to suffer.
|AAL||AMERICAN AIRLINES GROUP INC.||13.15||+0.09||+0.65%|
|UAL||UNITED AIRLINES HLDG.||37.00||+0.62||+1.70%|
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“I was furloughed due to low income and class sizes,” he said. “We went from about 40 students a class to six.”
After being laid off, Boyd got a job at All 2 Fly Aviation Academy in Atlanta. He says the main concern for pilot instruction is keeping the students safe.
“More of our bigger concerns were the close interaction that we have with students inside the aircraft. It’s a very tight area. We had to be very aware of wearing masks and make sure that the planes are being sanitized properly,” Boyd said.
Boyd says at All 2 Fly students can learn at their own pace during the pandemic.
“It’s nice to keep classes down but still be able to keep people flying,” Boyd said.
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The president and CEO of airline trade group Airlines for America, Nicholas Calio, added that massive furloughs are expected this month.
“It’s the very last thing that an airline wants to do to lay off a pilot, a flight attendant, a gate agent or a machinist,” Calio said. “Our employees are highly trained, and they have to keep being certified over and over again.”
Calio says the industry was at its peak before the coronavirus, but now it is suffering from a setback he says is worse than 9/11 in terms of finances.
“They told us to prepare to take a hit three times worse as 9/11; two weeks later we were bleeding $10 to $12 billion of cash a month, we’re still losing $5 dollars a month,” Calio said.
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Airlines have created multiple safety measures so they can keep flying, but it may not be enough.
“The mask requirement we are enforcing rigorously, we’ve got our enhanced cleaning procedures, electrostatic fogging and cleaning, wiping down every service with EPA- approved cleaners, and we’ve got the HEPA filters onboard,” Calio said.
Yet, the number of passengers is still down by 70%, according to Airlines for America.
“International travel is still down 90%. That is a significant factor because a lot of that accounts for a lot of the profit that oftentimes subsided domestic flights,” Calio said.
Those in the airline business are hopeful that a vaccine may help, but even then they think normalcy may be far away.
“We were in the golden age of flying — we always talked about it because flying was so affordable and so accessible. It’s going to be a very different industry for a long time and that’s a fact,” Calio said.