United Airlines Holdings (UAL 4.98%) told employees Wednesday it expects to furlough more than 16,000 workers as soon as next month as a government program that provided payroll support comes to an end.
The COVID-19 pandemic has caused travel demand to dry up, leading airlines to cut their schedules and look for ways to reduce costs. But to date, there has been no layoffs thanks to the CARES Act, which provided the industry with $25 billion in payroll assistance in return for a moratorium on involuntary job cuts through Sept. 30.
Image source: United Airlines.
There has been some talk in Washington about extending that support, but with the deadline fast approaching and the prospects for further assistance unclear, airlines are taking steps to cut their workforces.
United had previously said it would furlough up to 2,850 pilots, but the latest figure is the most detailed information we have on how much United intends to shrink due to a pandemic-related falloff in travel demand. The involuntary cuts are on top of about 7,000 United employees who have opted to take a voluntary separation package and about 20,000 who are on temporary leave.
In addition to the pilot cuts, United's plans involve cutting 6,920 flight attendants, 2,010 mechanics, 2,260 airport workers, and 1,400 management jobs. United has a total of about 90,000 employees.
United is not alone in shrinking its workforce. American Airlines Group (AAL 2.98%) said last week it would cut about 40,000 jobs, including 19,000 involuntary furloughs, due to the pandemic, and Delta Air Lines (DAL 3.05%) will need to cut almost 2,000 pilots.
