My View On “Delta Air Faces Union Recruitment Drive”
Friday, January 27th, 2012As a business model, it’s no secret that commercial air transportation cannot be depended upon for sustaining revenues above operating costs. As a result, carriers require continual infusions of subsidies in various forms. Take your pick:
o Fuel hedges to cover the red ink from operating losses. (If the bet works as hoped.)
o Over-priced business class fares required to cover under-priced coach class fares.
o Confiscatory give-backs by industry employee motivations.
o Bankruptcy laws favoring poor executive leadership styles decisions.
And continuous meddling by congress hasn’t helped either. Although air carriers are considered to be ‘deregulated’ for the purposes of generating the free market in seat and freight capacity, the navigable infrastructure which that capacity must transit is owned and operated by the federal government. Imagine if your cell phone operator had no choice but to use a federal transmission system, or your electric power provider, or your internet service provider. Consider how ineffective any of those industries would be at generating sustained revenues over costs if every single operation they initiated went through the federal government. Such is the influence of congress (through the DOT) in continually interfering in the efficient allocation of resources in the air transportation industry.
Due to the dynamics mentioned, and many more, industry employees have witnessed a career’s worth of pay-backs merely to retain the simple luxury of having a job. Reduced compensation has also resulted in the next generation of commercial pilots being slow to take the bait. Military pilots are staying in the military to be sure to tap their taxpayer-funded retirements before they contemplate the roller coaster ride of a commercial career. And civilian pilots contemplating an air carrier career can count on a $100,000 bill to attain an Air Transport Pilot rating alone – followed by a $25,000 annual salary for an entry level job on that roller coaster. Neither of these circumstances is presenting the industry with a surplus of highly trained pilots. Does that make a difference to potential passengers?
There are no simple solutions to the systemic chaos that defines this industry. But it certainly should come as no surprise to anyone that a large percentage of employees are weary of being tapped as the piggy bank for sustaining air transportation. Short of a solution which allows the industry to operate with sustainable economic efficiency, we should all expect to see air carrier employees asking to be compensated for the critical service they provide in supporting U.S. GDP growth.
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