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Airlines

Without Congressional Action, Over 40,000 Airline Jobs End

Without Congressional Action, Over 40,000 Airline Jobs End
Joe Cortez

After working at the 11th hour to try and pass a bill through, lawmakers on both sides of the aisle were unable to pass an extension of the Payroll Support Program. As a result, airlines will reduce their staff by over 40,000 employees on Oct. 1, 2020.

For weeks, airlines and labor unions have called on Washington to extend the Payroll Support Program, in order to keep employees at their positions despite the lack of travel demand created by the COVID-19 pandemic. Despite an 11th hour work session to try and pass a bill, lawmakers were unable to come to an agreement on a clean passage of the airline program.

On Midnight, Oct. 1, 2020, over 40,000 workers will no longer be with their airlines.

Airlines, Trade Groups Expressed Optimism Over Process

As the day begun, airline executives were working over cable news programs to campaign for an increase in the Payroll Support Program from the CARES Act. On CNN, American Airlines chief executive Doug Parker said he would consider delaying the furloughs if there was proposed action on a “phase four” economic stimulus bill.

“If there’s a clear and concrete path that says we’re not quite done yet but we will be done soon, of course [we’ll avoid job cuts],” Parker said during an interview on CNN. “If it’s ‘We need much more time to work’ and unclear whether we can get something done, that’s going to be much harder.”

Parker was the same executive who said in a previous interview on CBS that the airline had “plenty of liquidity,” while asking for Congress to extend more job protecting funds.

Airlines for America joined the call to extend money, issuing a statement supporting the negotiations on Capitol Hill. Calling out House speaker Nancy Pelosi and U.S. Treasury sectary Steve Mnuchin, the trade group asked for clear progress to extend payroll support.

“The CARES Act recognized that in order to save jobs and support general business operations, Congress needed to provide both payroll support and loans. One does not cover the other,” the statement reads. “Currently, that essential payroll support component expires at midnight tonight. Regardless of the loans announced by Treasury yesterday, without funds dedicated specifically to payroll (through the PSP), airlines will have to take action to address the loss of payroll funds.”

However, the deal was never meant to be. Roll Call reports the day ended with the two sides unable to agree on a new stimulus package. While the Democrats are calling for a $2.2 billion package, the Republican side is proposing a slimmer $1.5 billion package.

As a result, over 40,000 airline jobs are expected to end. Although Delta Air Lines and United Airlines came up with an agreement with their pilots unions to save those jobs, American is still expected to furlough 17,500 workers. United is expected to let go of roughly 13,000 employees, while the remainder of the cuts will come from the smaller carriers.

Although the current bill clearly offers additional payroll support to airlines, it is not expected to pass through the U.S. Senate.

Airlines Not the Only Ones to Suffer From Lack of Travel

While the airlines have received the majority of attention during the extension negotiations, they are not the only ones who are suffering from a lack of travel and tourism because of the COVID-19 pandemic. The Associated Press reports The Walt Disney Company will layoff 28,000 employees, at their amusement parks, due to closings and a lack of attendance.

View Comments (9)

9 Comments

  1. aethelwulf

    October 1, 2020 at 4:34 am

    The only safe jobs are working in government. The bureaucrats are all sitting pretty, drawing inflated salaries whether there’s anything to do or not.

  2. davidlhanson

    October 1, 2020 at 6:31 am

    Airlines just want free money. Why should taxpayers pay airline staff to sit around with nothing to do? Airlines need to get smaller and then recall staff as number of flights increase.

  3. BC Shelby

    October 1, 2020 at 11:59 am

    …the nation’s airlines had a financial resource, savings from the big tax breaks of 2017 (roughly about 40$ billion), but like most corporations did, they squandered it on stock buybacks instead of banking it for “rainy day” such as a spike in fuel prices or a major emergency/crisis that had a negative effect on travel. They only have themselves to blame.

  4. edgewood49

    October 1, 2020 at 12:05 pm

    Too bad politics have to pay into responses “aethelwuff” Having said that the problem is Parker and others are begging for more money all the while Parker admitted in an interview AA had plenty of cash on hand. I feel for those in the travel industry but we the tax payers can not continue to subsidize / pay their salaries all the while they’re not working. When these subsidies end the airlines are going to shrink and layoff many of these same people yet the bill for all this is going to come due bringing in 2021 no matter who wins the election. Thats a fact like it or not. This bill will go one until our grand children pay it off. Sadly there will be further subsidies.

  5. sfoeuroflyer

    October 1, 2020 at 1:40 pm

    What is really killing the airlines is the inability to implement rapid pre-departure tests. That speaks to political failure at many levels. The bureaucrats at CDC and FDA simply don’t get it. They collect their salaries without a care in the world. Remember bureaucrats are specialists in thinking of reasons NOT to do something.

  6. edgewood49

    October 1, 2020 at 4:56 pm

    “sfoeuroflyer” while you have a valid point it is simply not true and lets stop with politics. It serves no purpose to this discussion, back on point

    At the end of the day is an effective vaccine that has been taken by a large portion of the world population and then and only then will the odds be in the traveling public. “instant’ testing is not a guarantee that it’s safe flying inside an aluminum tube for any amount of time is safe. You don’t know just don’t know. I have spent a portion of my life serving in the military in some really funky places and what kept me from getting sick were the effective proven vaccines the Air Force gave us. Same goes for international travel today when traveling proven vaccines ,not the political landscape at that moment in time.

    In the meantime airlines will shrink back it had to happen anyway.

  7. GoProf

    October 1, 2020 at 5:12 pm

    What makes the airline workers more critical than people in all of the other industries who are losing their jobs? Way too expensive for us the tax payers.

  8. AJNEDC

    October 3, 2020 at 8:17 pm

    As long as congressional action doesn’t call for further taxpayers bail out of any industry I am good.

  9. kelvinj

    October 6, 2020 at 7:09 am

    I agree with the comments questioning why airline workers deserve job protection over other citizens. Other industries are folding and the airlines should be no exception. As the need for airlines services grows/shrinks, their business model should follow. I see no need to spend taxpayer dollars supporting airlines employees sitting at home doing nothing. All that arrogance had to come to a head. Welcome to the real world.

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