United is considering furloughing up to 16,000 employees starting October 1st, the airline said in a leaked memo. The furloughs touch every part of the airline, ranging from flight crew to catering to management. The news comes as President Trump considers more aid to airlines to prevent mass layoffs.
Furloughs impending
The recently leaked memo, seen by Airways Magazine, details the total number and total jobs cut from each department. Flight attendants will see the deepest reduction, with 6,920 jobs on the cutting block. Additionally, 2,850 pilots, 2,260 airport staff, and 2,010 technical staff will also be given furlough notices. Other departments such as administration, network planning, catering, and others will see cuts too.
In total, over 16,000 jobs are up for involuntary unpaid leave. This figure is lower than United’s 36,000 “right-sizing” figure from July, but still represents 20% of United’s US workforce. The airline is yet to confirm these figures, and things could change in the coming weeks, but without federal intervention, the carrier will likely implement steep job reductions.
The furlough notices will likely go out on October 1st, the day CARES Act funding for airlines runs out. Without an extension of such a program, or executive action from the President, it’s likely that airlines go ahead with their mass furlough plans. President Trump, and senior White House leadership, have emphasized the need the support airlines, but details remain a mystery.
Demand remains depressed
With federal payroll assistance running out, airlines are faced with the reality of current demand. United’s Chairman, Oscar Munoz, painted a gloomy picture of US aviation, saying that the industry could shrink by half. This shrinkage, even if not so severe, will result in tens of thousands temporarily losing their jobs until airlines can find their footing once again.
Despite a rise in flight capacity, United is still struggling to fill its planes, with only 45% of seats filled in July. The airline also recorded a $1.6bn loss in the second quarter of this year, prompting more cost-cutting measures. In the memo, United’s leadership said that layoffs are the airline’s last resort, but with other efforts not working and revenue down, the airline has little choice.
All eyes on October
The US aviation industry is waiting with bated breath as the October 1st deadline looms closer. With Congress still struggling to build consensus around a second bailout, all eyes are on President Trump to step in. American Airlines has also announced a massive 19,000 furlough program, potentially making October 1st the most devastating day for the industry through this crisis. In total, over 50,000 jobs in the airline industry could be affected by next month.
The next three weeks will be hectic, as airlines negotiate with unions and the government to finalize job cuts. While furloughs are temporary, the current state of the industry points to a long recovery before airlines reach their 2019 capacity. United has the second-largest planned cuts for now, but these figures could even rise in the future.
What do you think about United’s plans? Will airlines receive government assistance? Let us know in the comments!
