American Airlines announced on Tuesday it will cut 19,000 jobs in October unless the government extends the federal aid for airline employee payrolls.
The airline said that 40,000 employees might be affected from layoffs, furloughs and voluntary departures, meaning an almost 30% reduction from the airline’s workforce. American Airlines currently provides employment to approximately 140,000 people.
The job cuts will include 17,500 involuntary furloughs of employees including 1,600 pilots and 8,100 flight attendants and 1,500 management positions.
“As you all know, the Payroll Support Program (PSP) of the CARES Act protected our team against involuntary separations through Sept. 30. It also ensured that we and other airlines continued to serve each of the markets we flew prior to the crisis,” wrote American Airlines CEO Doug Parker, in a letter to employees on Tuesday.
American Airlines Anticipated Furloughs
“It was an incredibly effective piece of legislation. The only problem with the legislation is that when it was enacted in March, it was assumed that by Sept. 30, the virus would be under control and demand for air travel would have returned.”
“Based on current demand levels, we at American now plan to fly less than 50% of our airline in the fourth quarter, with long-haul international particularly reduced to only 25% of 2019 levels.”
“As Sept. 30 approaches, we have announced reductions in service, including the complete elimination of service to certain markets in early October, and today we are announcing the related reductions in our workforce.”
“Despite broad bipartisan support, a PSP extension is tied up in a larger COVID-19 relief package, which our elected officials haven’t yet been able to negotiate,” said American Airlines CEO Doug Parker .