In March, thanks to the advocacy of labor unions and airline CEOs, both parties and US President Donald Trump approved a $25 billion support package to help the aviation industry maintain jobs for workers.
US airlines therefore warn that the jobs of more than 75,000 employees will be at risk.
`We recognize that the ripple effect of the pandemic in the economy is quite large,` said David Lebovitz – global market strategist at J.P.
Crew members of an airline at John F. Kennedy Airport (USA).
If the US Congress does not have a new stimulus bill, airline employees may face lower unemployment benefits than previous months if they are fired after the aid package expires.
`Anyone who is unemployed finds the labor market is really unfavorable,` said Sara Nelson, President of the Association of Flight Attendants-CWA, a labor union representing flight attendants at more than 10 airlines.
`This is a terrible situation for everyone,` Nelson said of the lack of a new stimulus package, `We’re putting the whole country in a state of instability.`
Lost revenue of 10 billion USD
In total, the four largest US airlines lost more than $10 billion last quarter.
The International Air Transport Association last month forecast that global air travel demand would not recover to 2019 levels until 2024. That is a year later than expected.
`It’s clearly going to have a devastating impact,` said Severin Borenstein, professor of business administration and public policy at the Haas School of Business at the University of California-Berkeley.
To date, airlines have cut many flights.
`In early April, we saw the sharpest, deepest decline in demand in history, far worse than 9/11, the Great Recession or any other crisis scenario
Aid may come too late for some
The new round of support may come too late for tens of thousands of laid-off employees.
More than 20,000 employees have voluntarily left the airlines and cannot return unless they are rehired.
`The departure of 20% of our workforce is difficult but necessary to transform Delta into a smaller, more agile airline that is more resilient to crises and recovers quickly.`
About 2,500 Delta pilots are still at risk of losing their jobs this fall.
`The situation is going to be really bad for a long time,` said Kit Darby, a retired United Airlines captain and now a pilot salary consultant.
Airplane manufacturers are reeling
The trouble facing airlines has spilled over to plane manufacturers and their thousands of suppliers, as the pandemic has thrown demand for new planes into disarray.
Earlier this year, Boeing said it would aim to cut its workforce by 10%, to 160,000 people, by the end of 2019. The commercial aircraft division has been hit by hundreds of contract cancellations this year
Boeing is also evaluating dual production lines for the 787 in the Seattle and North Charleston areas.
General Electric, the company that makes engines for both Boeing and Airbus aircraft, said it would cut a quarter of jobs, equivalent to 13,000 people.
