American Airlines said on Tuesday its workforce will shrink by 40,000, including 19,000 involuntary cuts, in October as the coronavirus pandemic continues to weigh on air travel, unless the government extends aid for airline employee payrolls.
SHARES IN AMERICAN FELL 2.7 PERCENT AFTER PANDEMIC
Airlines received $25 billion in US government stimulus funds in March meant to cover payrolls and protect jobs through September. As the money runs out without a travel recovery in sight, airlines and unions have lobbied Washington for another $25 billion, but talks have stalled as Congress has struggled to reach agreement on a broader coronavirus assistance package.
Airlines have argued that the industry is essential to a quick economic recovery.
American’s planned job cuts comprise 17,500 furloughs of union workers -including 1,600 pilots and 8,100 flight attendants – and 1,500 management positions. They are below the 25,000 warning on possible job cuts American sent last month thanks to early retirements and leaves.
American said last week it was suspending flights to 15 small U.S. cities in October without more federal aid.