By Rajesh Kumar Singh

CHICAGO (Reuters). Whether they offer premium pay, sign bonuses and hefty salaries to their employees or are poaching staff from other airlines to boost their holiday workforces, American airlines are looking to prevent any disruptions to air travel.

Industry is facing shortages of flight attendants, pilots and service personnel after they sacked thousands during the height of the pandemic. Critics claim that the industry is responsible for the current staff shortage. The airline industry was unable to cope with the sudden increase in travel despite receiving $54 billion of federal assistance to cover its payroll costs.

In the United States, there is a lack of qualified workers and many companies are frantically trying to recruit them. Carriers have been forced to increase their salaries to hire talent. In a memo to employees this month, American Airlines’ Chief Operating Officer, David Seymour stated that “the hiring environment has changed due to the pandemic.”

American’s American subsidiary Piedmont Airlines offers a $180,000 bonus for pilots. United Airlines offers a $5,000 sign bonus to Boston ramp agents.

Spirit Airlines (NYSE) has increased the wages of its ramp agents by 30 percent. Ultra-low-cost airline offers flight attendants a tuition reimbursement of up to $4,000.

In a labor-strapped market, the rush to hire is pushing up prices at a moment when high jet fuel costs and increased airport fees are also driving down profits.

Southwest Airlines (NYSE) has seen its wage cost as a percent of revenues increase by 14 percentage points this year, compared with 2019. Similar increases have occurred at American and United Airlines in terms of salary costs.

However, the U.S. scheduled airlines’ October headcount was only 14.3% lower than its pre-pandemic peak. However, the peak employment rate at bars and restaurants, which were also hit hard by the pandemic lockdowns are just 6.4% lower than before the COVID-19 epidemic.

FEARING ALLURE

According to industry experts, the slowing recovery is due to the declining appeal of passenger airline jobs.

Even though the job is more difficult, entry-level jobs in airlines, especially low-skilled, have lower wages than those in other industries. This is especially true for regional airlines, who operate 43% (NYSE:) of American, United, Delta Air Lines Inc flights.

While these companies connect to low-density networks via satellite, the crews of their pilots receive far lower salaries.

This gap exists even at Delta and American’s regional airlines.

American flight dispatchers are paid more than double what their colleagues at Piedmont Airlines. The pay gap at Delta Airlines and Endeavor Air’s regional unit Endeavor Air is similar.

Keturah John, head of Piedmont’s union for flight attendants, stated that many employees have had to find a second job due to the fact that the salaries at regional carriers aren’t enough to pay living costs.

Last month, Piedmont’s flight attendants voted in favor of a strike demanding higher pay and better benefits. Johnson said, “We are fighting to a livable wages.”

A CRISIS LONGS IN THE MAKING

Analysts claim that labor shortages were already in existence long before COVID-19. The origin of the labor crisis can be traced to bankruptcies, consolidations that occurred after 9/11. This made carriers more cost conscious and less focused on their productivity.

Airlines became less dependent on their employees, logging longer hours as they slowed down. The Association of Flight Attendants believes that flight attendant workload increased at least 25% following 9/11.

Pandemic-induced decline in air travel caused the industry to increase its cost cutting efforts, resulting in the industry having the lowest workforce in over three decades. The industry was also hit hard by illnesses and quarantine.

Henry Harteveldt founder of the travel consulting firm Atmosphere Research Group said that COVID marked “the tipping point.” It exposed the airline industry’s underlying problems and ripped away its protective shell.

As dipping COVID-19 numbers brought back passengers, airlines resumed their hiring process this spring. The supply of qualified pilots is very limited. Amazon.com Inc. (NASDAQ:) provides cargo carriers. United Parcel Service Inc (NYSE 🙂 and FedEx Corp(NYSE 🙂 also vie for these positions.

Faye Malarkey Black is the head of Regional Airline Association. She stated that in 2020, the availability of new pilots dropped by 60%. It is 36% less than the pre-pandemic level, she stated.

Since years, industry workers have been worried about the possibility of a pilot shortage. Last year, carriers offered buyouts to thousands of pilots in order not to stop them from hiring.

RATE SOARING ATTRITION

Faced with an urgent need, they have begun poaching regional carriers heavily.

SkyWest (NASDAQ:) Inc., which provides flights to Delta, American, and United last month, stated that its attrition rate has reached double digits.

Regional airlines have lost pilots over the years to larger carriers, which is not surprising. Black claimed that the trend was now “on steroids.”

Subodh Karnik is the chief executive at Georgia-based ExpressJet Airlines. He compared the high demand for pilots with the high supply in America’s housing market, where homes are being flooded within days of listing. One-fifth, he said, of regional airline pilots are being snatched by large cargo and passenger carriers before they have completed their training.

The risk of operational meltdowns is high with insufficient staffing. This has led to several cancellations of flights that were highly publicized.

American and JetBlue have offered bonuses, better pay, and other incentives in an effort to hire enough people for the busy holiday season.

Karnik said that major airlines could cease servicing routes less lucrative if there is a continuing shortage.

United Airlines has announced that it will drop eight U.S. Midwest and South routes. Scott Kirby (NYSE :), chief executive at United, stated that there was a shortage in pilots and the cutbacks were the result.

He stated, “We don’t have enough pilots for all of the planes.”