IATA Research Shows 25 Million Jobs at Risk with Airline Shutdown

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The International Air Transport Association (IATA) released new analysis showing that some 25 million jobs are at risk of disappearing with the plummeting demand for air travel amid the COVID-19 crisis.

The livelihoods of some 65.6 million people around the world are dependent on the aviation industry, including sectors such as tourism and travel. Among these, 2.7 million jobs are for airlines.

In a scenario of severe travel restrictions that last three months, IATA research calculates that 25 million jobs in aviation and related sectors and endangered across the world –

  • 11.2 million in Asia Pacific
  • 5.6 million in Europe
  • 2.9 million in Latin America
  • 2.0 million in North America
  • 2.0 million in Africa
  • 0.9 million in Middle East

Airlines expect to see full-year passenger revenues fall by US$252 billion (-44%) in 2020 compared to 2019. The second quarter is the most critical with demand falling 70% at its worst point and airlines burning through US$61 billion in cash.

Airlines are calling on governments to provide immediate financial aid to help airlines to remain viable businesses able to lead the recovery when the pandemic is contained. IATA calls for

  • Direct financial support
  • Loans, loan guarantees and support for the corporate bond market
  • Tax Relief

“There are no words to adequately describe the devastating impact of COVID-19 on the airline industry. And the economic pain will be shared by 25 million people who work in jobs dependent upon airlines. Airlines must be viable businesses so that they can lead the recovery when the pandemic is contained. A lifeline to the airlines now is critical. Throwing airlines lifelines like this at this critical stage will help people far beyond those directly employed in air transport. That is one of the reasons why we believe that governments must make the viability of airlines a priority.”

Alexandre de Juniac, IATA’s Director General and CEO.

On average airlines have two months of cash on hand. And many airlines are already into the third week of major shutdowns of their businesses.

IATA is scoping a comprehensive multi-stakeholder approach to re-booting the industry when governments and public health authorities allow. The initial step is a series of virtual meetings, or summits on a regional basis, bringing together governments and industry stakeholders. Summit dates are being confirmed in the expectation of a start before the end of April. All stakeholders need to understand what is required to re-open closed borders and agree on solutions that can be operationalised and scaled efficiently.

Today Eurocontrol member states and European Air Navigation Service Providers have deferred the payment of more than EUR1.1 billion for air navigation services in February through to May this year to help airlines maintain liquidity. With airlines suffering from a severe liquidity crisis due to a 90% collapse of air traffic across Europe, this cost burden would have compounded the acute difficulties facing the industry.

The 41 member states of Eurocontrol,  which coordinates air traffic control operations across Europe, voted to delay payment of February’s charges to November 2020, with payments for March, April and May delayed to 2021.

IATA has announced the postponement of the 76th Annual General Meeting (AGM) and World Air Transport Summit scheduled to take place on 22 – 23 June 2020 in Amsterdam. It will be held when it is safe and practicable to do so, probably in the late third or fourth quarter of 2020.

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