Gloomy prospects for employment in the airline sector. As confirmed by a survey published on Wednesday by the International Air Transport Association (Iata), 55% of airlines are considering workforce reductions in the next twelve months due to a resumption of air traffic hampered by related uncertainties at Covid-19, according to a survey
45% of executives said they have already reduced their workforce due to the impact of the Covid-19 crisis on the air transport sector. They also resort to wage cuts to limit the deterioration of their cash flow.
57% of executives expect their profitability to decline over the next 12 months and believe ticket prices could drop due to the weak recovery in demand. 19% are counting on a gradual increase in prices once the balance between supply and demand is found.
Resumption of traffic in Europe and Asia Pacific
The Iata, which brings together 290 airlines, is counting on a return of pre-crisis air traffic in 2024 and estimates a 63% drop in traffic in 2020 compared to 2019 with a shortfall of $ 419 billion for the sector, due to the coronavirus crisis.
Asia Pacific and Europe should be the first to regain traffic to 2019 levels, while North America and Latin America should experience a slower return to normal than elsewhere, according to the Iata.
Tens of thousands of jobs cut
Announcements of plans for job cuts or layoffs are increasing around the world. The American United announced that it could fire up to 36,000 employees. American Airlines cited the figure of 25,000 cuts.
The German Lufthansa wants to cut 22,000 jobs, Air Canada 20,000, British Airways 12,000, Air France-KLM to 12,500, the Australian Qantas 6,000, the Scandinavian SAS 5,000, the British EasyJet 4,500.
LATAM, the most important company in Latin America, has announced the loss of 2,700 jobs and is placed, like the Colombian Avianca, under the protection of the American law on bankruptcy.
Bankruptcy filings
In bankruptcy, the Australian giant Virgin Australia is in the process of being acquired by an American company and announced Wednesday that it would close one of its subsidiaries and cut 3,000 jobs.
The British Virgin Atlantic has filed for bankruptcy in the United States and has already announced the loss of 3,000 jobs.
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- Covid 19
- Economic crisis
- Airline company
- Economy