Thousands of Delta Air Lines flight attendants and ground-service workers at Minneapolis-St. Paul International Airport will keep their jobs when government payroll assistance runs out next month, executives announced Tuesday.
The Atlanta-based carrier and all its major competitors are expected to make substantial staffing decisions over the next several weeks, indicating what a downsized U.S. airline industry will look like for the coming years.
Delta's ability to avoid furloughs for its flight attendants and ground-service workers — like baggage handlers and customer-service agents — is welcome news for MSP, one of its largest hubs that has been beleaguered with bad news since March.
There were about 1,800 flight attendants and 4,000 ground-based front-line workers based at MSP before the pandemic.
The federal government's airline bailout package expires on Oct. 1, which required carriers to keep workers employed for the first six months of the coronavirus pandemic in exchange for government funds, of which Delta received $25 billion. But as the health crisis continues longer than originally hoped, airline executives forecast it will take two to three years for demand to return to pre-pandemic levels and for the carriers to claw their way back out of economic crisis it has triggered.
During that time, airlines will be flying fewer routes, which means they will need fewer planes and fewer employees.
United Airlines recently announced it plans to furlough more than 16,000 workers on Oct. 1 and American Airlines said it will furlough as many as 19,000 workers at the same time.
Delta's pilots are the only major work group that is unionized at the airline. The company recently said it will furlough 1,941 of its most junior-ranking pilots next month unless it can reach a cost-cutting agreement with its pilots union, Air Line Pilots Association, International (ALPA).
Earlier this month, nearly 1,800 of Delta's more senior-ranking pilots took the company's early-retirement package, according to the Delta Master Executive Council of ALPA. The group said it proposed cost-cutting measures early in the crisis that management declined to implement.
"Since the pandemic began, ALPA has remained in the problem-solving mode," the Delta pilot council said in response to Tuesday's announcement. "Pilots are career-long stakeholders in Delta Air Lines, and as such, we are motivated to help the company while still upholding our core value of protecting pilot jobs. We are in ongoing talks with management to mitigate pilot furloughs."
It's unclear how many of those potential furloughs could affect MSP-based pilots. Minneapolis-St. Paul is considered a relatively senior base, where many of Delta's most experienced pilots live.
Ed Bastian, Delta's chief executive, said Tuesday in an employee memo that the company has been able to avoid the massive furloughs that their competitors are now facing "due to the innovation, hard work and shared sacrifice of our people."
More than 40,000 employees from across work groups took voluntary, unpaid leaves of absence over the past several months and about 17,000 employees — or about 20% of its workforce — took the company's early-retirement offer. Ground-based employees have had their work hours reduced by 25% as air travel continues to be significantly depressed.
Nationwide, U.S. air travel remains about 70% below what it was the same time a year ago.
Employee furloughs and layoffs are the final frontier as airlines downsize to better reflect this decreased demand. Delta and other carriers have gotten rid of hundreds of airplanes and sought loans from the private market. On Monday, Delta announced plans to raise $6.5 billion by issuing a private-notes offering backed by its SkyMiles frequent flyer program as collateral. United, American and Spirit have all made similar moves to fundraise using their loyalty programs — a huge source of revenue — as collateral.
Kristen Leigh Painter • 612-673-4767