Rafiq Jan
COVID-19 has affected each one of us in a different way. As the lockdown continues to stem the spread of the virus, the layoff is becoming a common practice. Though most of the industry and businesses are enduring serious hits, some, such as the tourism and the aviation sector have been hit the hardest, with the laying off staff in droves to manage operating costs and financial crunch.
A peek into the illustrious past
Airlines jobs had traditionally remained unaffected during global economic downturns and terror attacks in the past two decades. Plane manufacturers thrived and airlines grew by leaps and bounds, offering state of the art luxuries onboard to premium customers. Airline employees, too, made the hay from the windfalls to attain the much-coveted privileges that people in other professions envied. In short, a job in the aviation sector was a dream come true for those longing to enjoy a wide range of privileges apart from getting hefty pay cheques.
All that has changed because of the COVID-19 induced inflictions. Planes are being retired ahead of the original plan, and airline authorities are drawing redundancy plans to lay off a significant number of employees.
According to IATA chief economist, the airline industry will face a projected loss of $100 billion in 2021 because of slow recovery and the 2020 accumulated loss of $85 billion.
Debts accumulated during the COVID-19 crisis is also going to put enormous financial pressure on airlines, leaving them grasping for cash inflows. Chances are bleak for any fast recovery because of competitive ticket fares, and social-distancing that requires fewer passengers onboard. For an average flight to be profitable it must be nearly 75% to 80% full.
Estimated redundancies
To survive, airlines are left with no choice but to take the difficult decision of laying off employees.
The Emirates Airline of the UAE has started executing the first phase of its staff redundancy plan. It has laid off over 700 pilots and almost 7,000 cabin crew. Engineers approaching the age of 60 are being given early retirement, whereas 600 other engineers and technicians are in the termination queue. People employed in managerial and administrative positions await a similar treatment.
Qatar Airways CEO says, “we have to make substantial redundancies in our headcounts in light of falling air travel demands”. The airline is ready to layoff pilots and a majority of the cabin crew. Those spared of a layoff would have to face a 25% pay cut and reduction in allowances. Nearly every department of the Qatar airways is looking to have a lean employees’ rostrum and a substantial saving from pay cuts of those retained.
United Airlines has also announced to cut down 3,400 management jobs by September, that makes 30% of its white-collar workforce.
According to IATA’s forecast 11 million aviation-related jobs would be lost only in the Asia-pacific region, of this 1,28,000 will be from New Zealand only.
Lufthansa AG, the German Aviation giant, has decided to terminate 22,000 employees across the group, after a bid to declare insolvency.
Implosion of leadership
Ironically, no business owner—small or big, CEO of fortune-5 companies, CEOs of the world’s leading airlines and conglomerates—have come forward to rescue their employees in this unprecedented crisis. Overwhelmed with their crumbing businesses and grappling with the solution to stop the cash outflow, businesses are dumping what once formed part of the ‘most valuable assets,’ to keep the ship afloat.
Because of the sheer nature of Coronavirus—unpredictable and enigmatic—leaders are losing imagination to strike a breakthrough. The truth is that no one was prepared to handle a crisis of this magnitude. What initially was perceived a tip of the iceberg, has turned out to be a catastrophic avalanche.
No doubt, leadership will have to be redefined and remapped once the crisis is over. It is unfortunate that those who used to talk about supporting their employees through thick and thin are unable to even give them a safe passage.
Bottom line
My heart goes out to those made redundant during the crisis. We all must face this inevitability with grace and look forward to a successful rebound of the aviation industry that we all fondly cherish.
The author is an aviation expert.
