After a giant decline, airline hiring—and airline profits—are beginning to swing upwards. And that’s good news for career pilots.
Aiming toward an airline career? Studying hard for that next checkride? Cramming performance numbers, weight-and-balance figures, and endless regulations? Working on nailing those steep turns? Chances are, as you travel the long and expensive road to a flight deck for pay, you have omitted the due diligence, review, study, and analysis of the most critical subject matter of all: Just how is the industry doing?
Pop quiz: Are the airlines making money? How much? Who are the leaders? What is the expected growth in the airline industry over the next decade? How many pilots were hired in the past 60 days and by whom? If you are a serious student of the industry, as everyone headed that way should be, these are answers that need to be discovered. If the news is grim, it may be time to take up medicine or law.
So, how goes it? Last year ended with the top airlines in the black with the largest profits in a decade. That number is nearly $4 billion for the entire group of companies transporting people and boxes via airplane. The $3.9 billion the airlines took to the bottom line of their financial statements during last year’s fourth quarter comes after revenue of $122 billion.
The biggest shocker is the largest profiteer: the previously beleaguered and maligned United Airlines, which reported $1.6 billion in income. It looks like Continental is marrying a rich partner in its merger with United.
The number-two spot appears to have been earned by Delta with a respectable $1.4 billion in revenue, excluding special items.
The only large carrier that posted a loss was American, with a loss of $475 million.
How was this magical turnaround accomplished? The carriers cut capacity nationally, increased fares, and instituted those highly unpopular fees for baggage and other services.
Keep an ear to the rail to see how this good news sits with the workforce. The upper-office executives are most likely going to pocket their big bonuses while the pilots flying the DC-9 is still smarting from the 40-percent pay cut—which, according to management, was an absolute necessity for the company to survive. Conditions may be ripe for a good amount of grumbling from the front line and a demand for payback.
The industry soothsayers predict that the good news will continue through 2011. Robert McAdoo, a top-notch analyst at Avondale Partners, an investment banker in Nashville, says, “At least in 2011, it looks like the positive numbers will continue.”
What about growth beyond 2011? According to the FAA’s annual think-tank meeting last year, total airport operations at airports are forecast to grow “at an average annual rate of 1.5 percent, reaching 69.6 million in 2030” and “U.S. airlines will reach 1 billion passengers a year by 2023.” That’s up considerably from the 704 million in 2009.
What does this all mean? The trending is good and the environment for job creation is improving. The industry is seeing the beginning of pilot job growth right now.
Hiring is far less than robust, but there are signs of a recovery. Airline bottom-line income is improving. Your future directly depends on the rise and fall of company profit-and-loss statements. So, going forward, become a student of the industry, and always be cognizant of the fact that aviation is first and foremost a business. At this time, the future looks promising.
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