Bloomberg: The global aviation industry has racked up more than 350,000 job losses in the past six months, with more pain on the way, according to new research delving into the coronavirus pandemic’s impact on the once-buoyant sector.
The total could approach half a million positions after including some 25,000 cuts that don’t fit into the main categories of airlines, aerospace manufacturers and airports, and another 95,000 that are threatened but not formally announced, according to Rowland Hayler, a co-founder of consulting group Five Aero, which compiled the study.
Meanwhile, Asian firms and airports worldwide appear to be depressing the total by holding back on payroll reductions, or at least not publicizing them, Hayler said.
Airlines are offloading more than 200,000 workers after months of groundings wiped out earnings, threatening the survival of many players. With Covid-19 cases surging in hotspots and restrictions returning, passenger demand continues to sputter. Airports may need step up dismissals as the extent of the slump becomes clear, Hayler said.
Manufacturers such as Airbus SE and Boeing Co. are always reluctant to slash output because of the cost and complexity of slowing production lines, as well as the risk of pushing parts suppliers to the brink. They came into the crisis with record order books, though as those are eroded, the loss of engineering positions is mounting.
More than 80% of the job cuts announced so far have been in Europe and North America, even though the two regions accounted for only 49% of 2019 passenger traffic, the study shows.
While the figure may be higher because the biggest planemakers and many key suppliers are based in the West, losses in the Asia-Pacific in particular seem implausibly small, Hayler said, with more than half the total coming just from Australia and New Zealand.
Asian companies may be more reluctant to fire workers, but the absence of data from China and elsewhere is a major issue, he said. Leading carriers such as Cathay Pacific Airways Ltd. and Singapore Airlines Ltd. have also yet to announce permanent plans to reduce headcount while taking government furlough money, and are expected to do so in coming weeks and months.
More than 50,000 positions were eliminated across the sector in August, with the trend line suggesting that there are many more to come.
The Five Aero tallies don’t include potential moves, such as more than 20,000 added reductions at Gulf giant Emirates and tens of thousands in the U.S., where furloughed workers have been put on notice that their work could permanently disappear, Hayler said.
Firms like tour operator TUI AG that don’t neatly fit in any of the three main categories are also missing from the list.
“This crisis is wreaking huge long-term damage on the aviation industry,” Hayler said.
“Given the importance of the sector in supporting all sorts of other businesses, the job losses are also a disaster for the wider economy.”