Oct 1, 2020 - Economy & Business

Airlines begin mass layoffs while clinging to hope for federal aid

United Airlines
Photo: Thierry Monasse/Getty Images

American Airlines and United Airlines said they will begin furloughing 32,000 employees Thursday, as federal aid that propped up the industry during the pandemic expires, with no deal in sight for an extension.

Why it matters: As many as 50,000 workers across the industry face immediate job losses unless lawmakers and the White House can agree on a broader pandemic-relief package that includes more federal aid for airlines.

Where it stands: House Speaker Nancy Pelosi called off Wednesday night's scheduled vote on a $2.2 trillion relief package, and Treasury Secretary Steven Mnuchin told airline executives the two sides were still trying to negotiate a bipartisan deal.

  • Senate Majority Leader Mitch McConnell called Democrats' proposal "outlandish."

What they're saying: CEOs of both airlines said they would reverse furloughs and recall employees if Washington comes up with a deal for $25 billion in airline aid "over the next few days."

  • “It shouldn’t be this hard to do the right thing," said Sara Nelson, president of the Association of Flight Attendants, noting there has long been bipartisan support for extending the payroll support program for the airline industry.
  • "It seems Washington just woke up to this deadline. There is now real momentum to negotiate a COVID relief bill, including an extension of our Payroll Support Program."
  • Nicholas Calio, president of Airlines for America, said he was hopeful, but not confident, a deal could be reached.
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