Airlines will need to cut more jobs to be cash positive in 2021 - IATA

Airlines will need to cut more jobs to survive the COVID-19 crisis or face failure in the next 12 months, according to International Air Transport Association (IATA).

Alexandre de Juniac, director general and CEO of IATA said in a webinar that that while the trade body does not advocate job cuts, it may be the only way for airlines to survive.

IATA’s latest projections suggest that global airline revenue in 2021 will be down 46 percent compared to the 2019 figure of $838 billion, compared with previous projections of a 29 percent drop.

As a result, maintaining 2019’s levels of labour productivity in 2021 would require employment to be cut by 40 percent, meaning further jobs losses or pay cuts would be required to bring unit labour costs down to the lowest point of recent years.

De Juniac said: “If airlines are coming to a point at which they cut these jobs, of pilots and flight attendants, because they cannot do otherwise, I would ask the pilots and the flight attendants to accept this is very difficult rule, and accept it to help the airline industry to survive.”

He added that governments would need to provide financial relief to airlines as 1.3 million jobs are at risk, which he described as ‘a labour catastrophe’.

Brian Pearce, IATA chief economist, said: “Air travel is particularly sensitive to the case numbers. International travel is being affected by government travel restrictions, which are being put in place because of the fear of importing COVID-19 cases. In those circumstances we think a testing regime is the way forward, to avoid quarantine restrictions which are effectively the same as a travel ban.”




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