Pandemic Travel Slump Forces American Airlines To Plan 19,000 Job Cuts

A wage support scheme started by the United States government aimed for supporting the country’s airlines during the novel coronavirus pandemic is set to come to an end in October and once that happens, about 19,000 jobs will be cut by American Airlines, the airlines said.

These job cuts which will be over and above those employees leaving jobs voluntary and retirements, will reduce its workforce by about 30 per cent compared to its staff strength in March, said the biggest airline of the world.

Warnings of similarly large cuts amid a slump in air travel have also been issued by other carriers.

For example, as many as 36,000 jobs at the airlines were at risk, United said last month.

Warning of possible culling of 22,000 positions was also issued by Germany’s Lufthansa. About 12,000 jobs are set to be cut by British Airways.

There have been forecast by global airline bodies that the novel coronavirus pandemic impact on the global airline industry will be more than $84bn for the current year.

The US government barred airlines in the country from implementing any significant job cuts prior to September 30 as a precondition for the airlines to avail the $25bn government bailout. Earlier this month, talks in Washington about an aid package ended without a result even as airlines have called on the government to lend further support.

$5.8bn from the payroll aid program has been given to American. Recently, the airline also announced suspension of service to 15 smaller airports in the US because of low demand for air travel.

“We must prepare for the possibility that our nation’s leadership will not be able to find a way to further support aviation professionals and the service we provide, especially to smaller communities,” chief executive Doug Parker and president Robert Isom said in a message to staff.

In the final three months of 2020, the executives said that they expected American to be flying at about 50 per cent capacity, according to the letter. The airline also expects to see a 25 per cent reduction in its international flights compared to the capacity levels of 2019 for the same period.

American expects less than 100,000 employees to remain with it in October compared to the total of 140,000 at the beginning of March, the airline said.

Since March, about 12,500 people have voluntarily left the airline in addition to the 19,000 job cuts. An additional 11,000 employees will be on voluntary leave in October.

(Adapted from BBC.com)

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