The coronavirus crisis has impacted businesses around the globe and millions of people have lost their jobs so far. European airlines are going through the same crisis and more and more employees are losing their jobs every month. Even though the situation is better than what Latin America’s airlines are facing, it’s still troublesome.
Many airlines have announced to cut jobs over the past few months, and this shows how small the industry would be once the situation returns to normal. But, the pandemic is not the only reason for the removal of jobs, as many careers were already in financial trouble. So, the pandemic just added to those financial struggles and made the situation worse.
The numbers could be low if conditions improve and productivity increases, but sill the size of the European airlines would be smaller, once things get back to normal. IAG’s British Airways is looking to cut around 11,765 jobs, while Lufthansa; the German airline can cut 10,000 jobs.
Both airlines think that the passenger numbers in 2019 would again be seen in 2023. So, the cut in jobs is proportional to the reduced operations. Air France-KLM also agrees and they do not expect the demand to recover for several years. The company is planning to reduce 19% of its fleet in 2021.
Low-cost careers are also affected, as Ryanair can cut up to 2,980 jobs in July and cut some European routes as well. The company thinks that the recovery of the industry can take around 2 years.
To attract customers and increase demand, airlines can cut fares, at least in the early stages of the restart. IATA chief economist Brian Pearce thinks companies would lower the airfare, especially to attract fairly cautious customers. He said that, as the restrictions are gradually lifted the demand is relatively low. China has seen an improvement because life is returning to normal, but it’s still not good enough, as the demand is weaker as compared to last year. The airlines in china are also offering low fares to attract passengers.