2020 was nothing short of hellish for the airline industry. With global losses last year topping $370 billion, demand has only just started to creep back as US airlines continue to lose $150 million each day.
But one year and three government bailouts later, some airlines are showing signs of recovery. Urged on by recent vaccine successes, United has cautiously predicted that 90% of its business will return by December, while Delta Airlines have talked of breaking even by the Spring.
This glimpse at the finish line offers airlines an opportunity to reflect on the lessons learned over the past year and to examine the varying degrees of success with which carriers adapted to the challenges of the pandemic.
Furloughs and Lay-Offs
The overall picture for airline employees in 2020 was bleak, with over 70,000 redundancies across the sector. However, within the industry, individual airlines handled lay offs extraordinarily differently.
Whereas United and American Airlines involuntarily furloughed 32,000 workers between them, neither Delta nor Southwest Airlines furloughed a single employee.
American Airlines furloughed the most workers of any single US airline, with 19,000 layoffs after the initial CARES Act expired on October 1. The carrier even warned of 13,000 more job cuts this year before the terms of President Biden’s Covid Relief Bill were published.
Similarly, after the second round of relief funding in December, United still warned staff coming back from furlough that they faced “temporary employment”, sparking outrage from pilots and flight attendants’ unions.
Delta Airlines, meanwhile, engaged in painstaking negotiations with pilots’ unions in order to persuade thousands of workers to retire early or take voluntary unpaid leave. In November the airline agreed a temporary pay cut with its pilots in order to avoid 1,700 potential furloughs and secure current employment levels until at least 2022.
Speaking at the time of the negotiations, Delta’s Chief of Operations John Laughter expressed his gratitude to be able to “keep all our pilots actively employed and provide stability for you and your families”.
High Altitude Hygiene
Aside from keeping their staff employed, the greatest challenge airlines faced during the pandemic was in keeping their customers safe and their services as hygienic as possible.
In response to the threat of Covid-19 all major airlines massively stepped up their cleaning regimens and imposed mandatory mask policies even before the federal government required it.
Yet beyond these baseline policies airlines again exhibited vast discrepancies in responding to new information about the virus. At present Delta Airlines remains the only major carrier to continue blocking its middle seats, despite well documented research from MIT suggesting that doing so cuts the risk of contracting Covid-19 by more than half.
Instead, other airlines are offering customers the option to switch off of busy flights for free, with United Airlines telling passengers they would “do our best” to give them 24 hours warning if their flight was busy.
However, with passenger numbers continuing to climb, there may soon be no quiet flights to transfer to. Only this week, the New York Post’s Paul McPolin complained of being squeezed onto a “jam-packed” United flight to Florida and worried that “the greedy airline would exponentially increase my risk of dying from Covid-19”.
Vaccines for Staff
Shockingly the government has still not recognized the pressing need to offer priority vaccines to airline workers, prompting airlines themselves to step in and look after their staff.
In this regard many airlines have responded very well to the pandemic, with both American Airlines and United setting up vaccination centers at Chicago’s O’Hare airport. The vaccines are available to airline staff aged 65 and older who live and work in Chicago. United’s CEO Scott Kirby has been especially vocal about his support for vaccination in the past, even going so far as to openly encourage mandatory vaccination for all United Staff.
Similarly, Delta Airlines has set up a vaccination center for its employees at Hartsfield-Jackson Atlanta International Airport, as well as a community vaccination center at the Delta Flight Museum on the outskirts of the city. The Museum now serves as one of the largest vaccination centers in Georgia, available to any qualifying resident who lives near the airport.
Road to Recovery
The varying success with which airlines have adapted to the pandemic has inevitably impacted the companies’ projected recovery speeds. While Delta Airlines foresees a return to profitability by Summer 2021, United predict a more cautious return to normal by 2023 at the earliest.
American Airlines is even less optimistic, posting its biggest ever annual loss in January and warning of the need to once again address staffing levels if demand doesn’t significantly improve by the Spring.
More broadly, all airlines are predicting a shift towards greater levels of domestic compared to international travel, as well as persistently low rates of business travel over the next few years. As the world of post-covid travel begins to take shape this year, it is likely that airlines will need to continue adapting if they stand any chance at survival.