Relief Bill Gives Airline and Airport Workers a Reprieve, for Now
The pandemic relief bill that President Biden signed Thursday afternoon will protect tens of thousands of aviation jobs, providing a lifeline to an industry that is likely to struggle for some time even as vaccinations accelerate.
After Congress this week approved the legislation, which includes $14 billion for airlines and an additional $9 billion for airports and other businesses, American Airlines and United Airlines told 27,000 employees that they could ignore the furlough notices they had received in recent weeks. The airlines had issued the warnings, which are legally required in advance of sweeping cuts, as they prepared to carry out the furloughs at the end of this month when an earlier round of federal aid expired. The new bill extends that assistance through September.
“If you have one of those WARN Act notices we sent out in February, tear it up,” Doug Parker, American’s chief executive, said in an Instagram video. “There aren’t going to be any furloughs at American Airlines in April and, with vaccinations on the rise, hopefully never again.”
The relief package, which Mr. Biden has said is needed to protect the economy and workers and which many Republican lawmakers have criticized as excessive, is the third to provide funding to keep airline workers employed since the pandemic began. Last March, Congress provided passenger airlines $25 billion in loans and another $25 billion in payroll grants. It renewed the payroll funding in December with a further $15 billion and again this week.
The Biden relief bill also sets aside $1 billion for aviation contractors and $8 billion for airports to help them operate normally, limit the spread of the virus, and pay workers and service their debts. In exchange for the aid, airports, contractors and airlines are prohibited from large layoffs through September and were forced to make other concessions.
The aviation and travel industry has been among the hardest hit by the pandemic. A year ago, the number of people flying started to plummet as the virus spread widely and government officials restricted or discouraged travel. By early April, the number of people flying every day had dropped 96 percent from a year earlier.
Travel has recovered somewhat since then. An average of about a million people a day have been screened at airport security checkpoints over the past week, down about 46 percent from the same period in 2019, according to Transportation Security Administration data.
Still, airlines are collectively losing $150 million a day on average, according to Airlines for America, an association that represents American, United and the other major carriers. The widespread distribution of vaccines has given the industry hope for a rebound, but airlines are expected to continue to lose money through the summer, and most industry analysts and executives don’t expect travel to recover to 2019 levels until 2023 or 2024.
In a report on Thursday, Fitch Ratings said it now expected a slower air travel recovery in the first half of the year in the United States and Canada than it previously forecast. But the second half of the year could see a “fairly robust rebound,” Fitch analysts said, citing recent surveys that show that many people are eager to travel once they feel it is safe.
“Fitch believes reaching full herd immunity may not be necessary to at least begin to drive a rebound in travel,” the analysts wrote. “Rather, a decline in death rates spurred by vaccine coverage among vulnerable populations may be sufficient to loosen pandemic restrictions and build traveler comfort.”
In the meantime, airlines are doing what they can to get people to book tickets, setting up direct flights to popular beach destinations, cutting fares and promising strict enforcement of safety procedures.
But obstacles remain. This week, the Centers for Disease Control and Prevention said people who had been fully vaccinated could safely engage in a wider range of activities than those who hadn’t, including gathering in small groups at home without masks or social distancing. To the frustration of airline and other industry executives, the agency continued to recommend that everyone avoid travel.
Airlines have argued that there is a low risk of virus transmission in flight because of high-end cabin ventilation systems, strong disinfection practices and strict mask requirements. But travel has nonetheless facilitated the spread of the virus around the world.
“We know that after mass travel, after vacations, after holidays, we tend to see a surge in cases,” the C.D.C. director, Dr. Rochelle Walensky, said Monday night on MSNBC. “And so, we really want to make sure — again with just 10 percent of people vaccinated — that we are limiting travel.”
Widespread distribution of the vaccines won’t solve all of the industry’s problems, either. It could be at least another year, if not much longer, before corporate and international travel, which tends to be much more profitable for airlines than leisure bookings, begins to rebound.
Some people have speculated that business travel could be reduced permanently because salespeople and other professionals have grown accustomed to videoconferencing and have come to realize that many trips they used to make were wasteful.
This article originally appeared on New York Times