United Airlines and American Airlines furloughed more than 32,000 employees late last week when federal government support under the CARES Act expired. Airline employees and the traveling public followed last minute negotiations between Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi but no agreement was reached by the October 1 deadline. Not everyone supported another bail out for the airlines, arguing that the industry needs to restructure but it is important to retain a well trained, skilled workforce to support business and leisure travel needs as the overall market starts to rebound. According to an article on CNBC.com even if a deal is reached and the 32,000 workers are recalled, thousands more airline jobs have been lost through downsizing and restructuring. "The tally of furloughs this week doesn't reflect the extent of the job loss hitting the airline industry. Tens of thousands of other employees accepted buyouts and temporary leaves of absence that airline executives urged as they scrambled to cut costs."
https://www.cnbc.com/2020/10/02/pelosi-vows-more-support-for-airlines-asks-carriers-to-hold-off-on-furloughs.html
https://cnb.cx/2ShqgaG
https://cnb.cx/2ShqgaG
It is hard to fathom the degree at which COVID-19 has hit airlines. Regardless of a restructuring or not I agree with you that thousands of jobs will be lost as airlines simply can not pay some employees without aid. I expect their recovery to be multiple years and lag behind other sectors.
ReplyDeleteThe airline industry is quite the confusing one, as ticket prices are based on large amounts of reliable data found over many years, in order to capture the largest amount of profit by strategically pricing off this info. With an almost full shutdown of the industry and far fewer flying than ever in recent years, this has made a large impact on the industry and it will need to be supported to make sure it still remains competitive in the future for the best of the consumers.
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