Thief River Falls has enjoyed commercial air service since the early 1950s, and many airlines have come and gone over the years. All fell victim to the harsh economics of the airline business.
Now, a small, federally subsidized airline called Boutique Air, which began service last year, offers 18 round-trip flights every week to the Minneapolis-St. Paul International Airport.
“It’s been excellent,” declared Thief River Falls Mayor Brian Holmer last week. “Our airport has really turned around.”
But another economic headwind is threatening air service at regional airports throughout the state and across the country — a national shortage of airline pilots.
Some 14,200 pilots are expected to retire from the four biggest U.S. airlines by 2022, and fewer young pilots are entering the profession to fill the void, according the Regional Air Service Alliance (RASA).
With too few pilots to fly the aircraft, and with airlines curtailing use of planes with 50 seats or fewer that typically serve smaller markets, the future of regional air service appears challenged.
Only nine airports in Minnesota offer airline service, but even that capacity means “the community can access the world,” said Cassandra Isackson, director of aeronautics at the Minnesota Department of Transportation. “It’s also a way for the world to access that community.”
While some communities like Thief River Falls are thriving due to niche services like Boutique Air, which flies eight-seat Swiss-made Pilatus PC-12 aircraft, other areas struggle to attract and retain airline service.
“If a community or a region doesn’t have air service, it’s not considered for economic development, a plant relocation or even a plant location,” said William Swelbar, RASA’s executive director and a research engineer at the Massachusetts Institute of Technology.
The stakes are high: The U.S. airline industry drives $1.6 trillion in economic activity annually, about 5 percent of the nation’s gross domestic product, according to the Federal Aviation Administration.
Brian Ryks, executive director/CEO of the Metropolitan Airports Commission, says big hubs like MSP benefit from thriving smaller airports because outstate passengers can connect to domestic and international flights. Almost 72,000 airplane seats a week feed into MSP nonstop from small communities, making the airport eighth in the nation by this measure.
Ryks, who ran both the Duluth and St. Cloud airports earlier in his career, is familiar with the challenges facing smaller communities.
“I would lose a lot of sleep just trying to retain air service we had, and expanding it takes a tremendous amount of effort,” he said. “When you have air service, you try to encourage people to use it, because if they don’t, you lose it.”
Shortage or not?
Richard Anderson, retired chief executive of Delta Air Lines, said in a February speech at the Economic Club of Minnesota that airlines are facing an “acute pilot shortage. There’s a big demographic hole in our pilot base.”
After the Sept. 11 terror attacks, airline service was cut back and the Great Recession also hampered pilot recruitment.
“The pilot shortage severely affects smaller regional airlines, where many pilots begin their careers and [where] you’re paid less than the majors,” said Kent Lovelace, a professor and director of aviation industry relations in the University of North Dakota.
Until 2014, annual pay for new first officers was about $25,000 at regional airlines, but Lovelace said compensation at the regionals has improved in recent years to around $60,000 a year with bonuses. “It’s too early to tell whether that will generate more interest” in the profession, he said.
The average cost for a student’s flight training at UND, a nationally known aviation program, is about $64,000 (not including room and board and tuition), which results in serious student loan debt for budding pilots.
For millennials considering aviation as a career, quality-of-life issues resonate, too. Airline pilots live out of a suitcase at work and often have erratic schedules.
Joe Hedrick, manager of the Thief River Falls airport, says he gave up studies to become an airline pilot. “I learned about the starting salary, and having to sleep in dingy hotel rooms and crash pads. None of that seemed attractive to me.”
But Anderson says the real reason regional airports don’t succeed is because of simple economics.
The Air Line Pilots Association (ALPA), the union representing pilots, says business decisions by the airlines affect service at regional airports — not a shortage of pilots. “We don’t see a correlation between the two,” said Capt. Paul Ryder, ALPA resource coordinator.
Ryder said regional airlines that offer competitive pay and benefits, work-life balance and “career progression” are hiring pilots. “The pilots are out there,” he said.
Others claim that regulations are choking the pilot pipeline — a charge the pilots’ union rejects.
Beginning in August 2013, the FAA required airline pilots (with some exceptions) to have a minimum of 1,500 flight hours in the cockpit before being hired as a first officer — up from 250 hours. The change followed the 2009 crash of a Colgan Air regional jet near Buffalo, N.Y., that killed 50 people.
The new regulations had “the effect of constricting and elongating the supply ‘pipeline’ of much-needed airline pilots,” according to Flightpath Economics, a Colorado consulting firm.
At the time, Great Lakes Airlines served Thief River Falls, but it “lost a lot of pilots, and became very unreliable for us,” Hedrick said, noting the airline stopped flying there for eight months in 2014. That year, just 734 passengers flew to and from the airport; nearly 10 times that many did so last year. (Figures from 2016 include service provided by both Boutique Air and Great Lakes.)
Last week, Digi-Key Electronics, which now employs about 3,200 people in Thief River Falls, announced that it was considering a $200 million expansion there that would create 1,000 jobs. “Having air service here makes it easier for their vendors, suppliers and employees,” Hedrick said.
Thief River Falls, Bemidji, Brainerd, Chisholm/Hibbing and International Falls are eligible for subsidies under the U.S. Department of Transportation’s Essential Air Service program, which was enacted following deregulation of the airline industry in 1978 to preserve service to smaller communities.
But there’s talk that the Trump administration will eliminate most federal airport subsidies, including the Essential Air Service program.
The fate of the program is “political fodder,” Swelbar said. “Everyone knows you’re just one tweet away from a change. I’m hearing mixed messages from Washington about the program going forward.”