Most airlines expect job cuts over next 12 months: Iata poll

Germany's Lufthansa is among the airlines planning to downsize their staff as global air travel demand remains weak amid the coronavirus pandemic.
Germany's Lufthansa is among the airlines planning to downsize their staff as global air travel demand remains weak amid the coronavirus pandemic.PHOTO: REUTERS

GENEVA • Most airlines are considering downsizing their staff over the next 12 months due to the coronavirus crisis, the International Air Transport Association (Iata) said, citing an internal survey.

"With the recovery in demand likely to be slow, 55 per cent of respondents expect to have to decrease employment levels over the coming 12 months," the global aviation body said in a statement on Wednesday following a quarterly business confidence survey of more than 300 airlines.

Some 45 per cent reported having already reduced their staff numbers in the second quarter of this year due to cost-cutting measures amid the Covid-19 pandemic.

Meanwhile, 57 per cent expect passenger yields to fall over the next 12 months and think ticket prices could fall due to the weak recovery in demand.

Some 19 per cent expect to see a gradual increase in fares once the balance between supply and demand is restored.

Geneva-based Iata represents some 290 airlines comprising 82 per cent of global air traffic.

It expects air traffic to return to pre-crisis levels in 2024 and estimates that traffic will fall by 63 per cent this year compared with last year, with a shortfall of US$419 billion (S$574 billion) in the sector owing to the coronavirus crisis.

Europe and the Asia-Pacific region are expected to be the first to return to 2019 traffic levels, while the Americas are expected to experience a slower recovery, according to Iata.

The aviation sector has been hit hard by the crisis, with almost all aircraft fleets grounded and tens of thousands of jobs lost.

US carrier United Airlines has announced that it could lay off up to 36,000 employees. American Airlines has cited the figure of 25,000 redundancies.

Germany's Lufthansa is planning to cut 22,000 jobs, Air Canada 20,000, British Airways 12,000, Air France-KLM up to 12,500, Australia's Qantas 6,000, Scandinavia's SAS 5,000 and Britain's easyJet 4,500.

Latam, the largest airline in Latin America, has announced the loss of 2,700 jobs.

Virgin Australia announced on Wednesday that it would close budget subsidiary Tigerair Australia and lay off 3,000 staff as it prepares to relaunch under new owners.

Virgin Atlantic has applied for bankruptcy protection in the United States, court filings showed on Wednesday, as the British airline - which has not flown since April due to the pandemic - seeks to tie up a rescue deal in Britain.

AGENCE FRANCE-PRESSE

A version of this article appeared in the print edition of The Straits Times on August 07, 2020, with the headline 'Most airlines expect job cuts over next 12 months: Iata poll'. Print Edition | Subscribe