Many U.S. airlines are overstaffed due to reduced flying schedules and low demand for air travel amid the coronavirus pandemic.
Airlines, hotels and other travel-related businesses are trying desperately to urge Congress to act on a new relief plan in the wake of mass layoffs.
The day the airline industry didn’t want to see coming arrived today, Oct. 1, when 32,000 American Airlines and United Airlines employees face furloughs after lawmakers and the White House failed to agree on a broad pandemic relief package including more federal aid for airlines.
Treasury Secretary Steven Mnuchin met with House Speaker Nancy Pelosi, D-Calif., to try to work out a deal, to no avail. The House voted mostly along party lines late Thursday to approve a Democratic-backed $2.2 trillion coronavirus relief package, which includes another $25 billion in support for airlines, but it was unlikely to be taken up by the Senate.
At the White House, Press Secretary Kayleigh McEnany blamed the layoffs on Pelosi Thursday and urged Congress to present a separate bill to protect airline jobs so that action doesn’t become stalled as part of talks on the overall relief measure.
“Let’s consolidate around things we agree on,” she said.
Major airlines were dealing with the crisis in their own ways:
- American: CEO Doug Parker said that if Washington comes up with a deal providing $25 billion for airlines “over the next few days,” the company will reverse 19,000 furloughs and recall the workers.
- United: Lack of funding will force the furlough of 13,000 workers, the airline said, but it can undo the move if a deal comes through. In an Instagram message, CEO Scott Kirby said the carrier will be “100% focused” on trying to get to a position in which anyone laid off can return.
- Delta: Through aggressive early retirements and other efforts, Delta was able to head off layoffs of flight attendants, but it could have too many pilots as of Nov. 1 if additional funding doesn’t come through, said CEO Ed Bastian in a message to employees.
- Southwest: CEO Gary Kelly appeared in a video in which he said federal aid could get the industry six months more funding, enough to hopefully get through the crisis. He warned of layoffs “as a last resort” only if the airline is unable to reduce enough costs through concessions
Other travel industry officials, meanwhile, have been sounding the alarm.
(Photo: Getty Images)
It isn’t just airlines in dire condition.
Airports in North America are facing more than $23 billion in losses due to the drop in air travel, says Airports Council International. “Government inaction at this time of crisis is not an option,” said Kevin Burke,CEO for North America.
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The entire U.S. travel industry employed 15.8 million Americans, about one of every 10jobs, before the pandemic. But its onset wiped out 51% of them, said Roger Dow, CEO of the U.S. Travel Association, at a news conference Tuesday. And relief hasn’t come to some important travel business, such as smaller nonprofit marketing organizations beyond museums and other attractions.
The damage has been especially devastating for hotels.
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The hotel industry has already lost 2 million of the 8.3 million jobs it had before the pandemic. Without relief, the number of jobs lost could rise to 3.7 million, warned William “Chip” Rogers, CEO of the American Hotel & Lodging Association. Some 38,000 of the nation’s 57,000 hotels that had been in business at the start of the year could be forced to close within six months.
Hotels are “really on the brink of collapse,” Rogers said. “We need Congress to take action before our industry is changed forever.”
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Tourism-dependent cities, like scenic Savannah, Georgia, have suffered. Mayor Van Johnson said the city knows it will take years to recover and shake the city to its core in the meantime.
“We know that visitors will eventually return to Savannah, but we don’t know what type of Savannah they will return to,” Johnson said.
Contributing: David Oliver, USA TODAY and The Associated Press
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