United States President Donald Trump today mentioned that he would step in to help airlines as the end of CARES payroll support funding approaches. Last week it was suggested that Trump might sign an executive order to address the situation.
October 1st is shaping up to be a rough day for aviation in the United States as things stand. Without any changes in the meantime, thousands of employees are expected to be furloughed across most, if not all, of the United States’ airlines. These employees are currently protected by the terms of payroll assistance being given to the airlines.
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What’s the latest from Trump?
Last week Simple Flying reported that the White House was considering wading in to help airlines if no agreement on the second round of payroll support is secured. As October 1st draws nearer and nearer, the chances of such an agreement being reached are becoming smaller and smaller. The White House’s Chief of Staff had mentioned that Trump was looking at ‘executive actions.’
It seems as though Trump is committed to helping the United States’ airlines. However, precisely what form this help would take is not immediately apparent. According to Reuters, Trump today commented:
“We’ll be helping the airlines. You have to help the airlines. Airlines are a tough business in good times.”
Tens of thousands of layoffs looming
Tens of thousands are set to be furloughed across the United States aviation industry at the end of the month. American Airlines is planning to furlough around 17,500 members of staff. Meanwhile, earlier today, Hawaiian Airlines revealed that it had 442 furloughs intended for flight attendants and pilots.
But why are the furloughs necessary. Ultimately, due to the considerable decrease in demand that has been prompted by the current situation. Sundays are currently the busiest days for air travel in the US, with between 800,000-900,000 travelers in the last four weeks. For comparison, on August Sundays, in 2019, the TSA was clocking an average of 2.4 million passengers a day.
Airlines’ employee numbers are currently based around that 2.4 million passenger figure. However, the reality is that with demand as low as it is, there isn’t enough work to keep everybody busy. Additionally, with less money coming in, airlines can’t afford to pay staff not working.
So why haven’t employees already been furloughed? This was due to the CARES payroll support that airlines currently receive. Valid from April to September, one of the caveats of the CARES funding was that airlines were not allowed to furlough employees. They were also required to maintain services on specific routes.
When the funding expires after September 30th, these employment and service conditions will also pass, giving airlines free rein to furlough staff and cut routes. Presently, no additional funding has been secured, which is what President Trump is trying to address.
Do you think Trump will stop tens of thousands of airline furloughs? Let us know what you think and why in the comments!