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CAPA - Centre for Aviation

  • Type: Informa

No easy answers for US airlines as staff furloughs loom large

In order to avoid massive industry furloughs on 01-Oct-20, US airlines and labour groups have been engaged in an intense lobbying effort to expand payroll support, and the likelihood of the country’s Congress actually passing the necessary legislation for more funding is fading fast. 

There are arguments for and against an extension of the support – delaying the inevitable, versus swelling the ranks of US employment numbers, which will further create a drag on the country’s economy. 

But the debate over the pros and cons of additional payroll support is likely to be over soon as inaction by the Congress renders the discussion irrelevant.

And if even if airlines can buy more time with additional payroll support, no one can predict how the industry will look in Mar-2021 when the proposed funding would expire.

Summary:

  • Even with some slightly positive trends, US airline capacity is still outpacing traffic. 
  • US airlines continue their last-minute push for an extension of payroll support, but the outlook for the US Congress pulling together and passing legislation for additional funding looks bleak. 
  • Even with the time the support could buy, the reality is that airlines cannot be certain of when demand will return, and there is an argument that additional funding is just delaying the inevitable. 

View more here: https://centreforaviation.com/analysis/reports/no-easy-answers-for-us-airlines-as-staff-furloughs-loom-large-538690