Jan 16, 2022

The aviation business has its ups and downs, just like anybody who has ever ridden a roller coaster can attest. In the aftermath of September 11, 2001, when air travel fell to such an extent that furloughs and pay cutbacks were the norms, the company managed to keep its head above water. The typical starting salary for regional pilots was about $20,000.

Due to the emergence of the COVID-19 pandemic, the need for pilots experienced a complete 180-degree change in demand. After years of coping with a pilot shortage, the aviation industry found a pilot surplus almost instantly. Now that vaccination rates are increasing and airlines are ramping up their summer schedules, it appears that the situation has altered once more. 

The airlines located in the United States may soon be confronted with a post-pandemic pilot shortage. How will the airlines solve this problem?

Post-Pandemic Situation

Pilot Shortage Begins To Ease and Then Reemerges With a Vengeance

A sudden shift in the supply and demand balance for airline pilots came about due to the COVID-19 outbreak. As a consequence of the drastic drop in airline capacity last year, the need for pilots has decreased as well. Many companies provided substantial early retirement packages to minimize their personnel expenses and save money. These offers were accepted by more than 1,800 Delta Air Lines pilots, as well as hundreds of pilots from American, United, and Southwest Airlines, among other companies.

The early retirement programs implemented last year have hastened some of the compulsory retirements that would have occurred for the following five years. As a result, the near-term pilot shortage will worsen, with US airlines potentially exceeding pre-pandemic capacity levels by the summer of 2023. According to the Federal Aviation Administration, Many of the airlines’ present pilots must be retrained as a part of their fleet improvements, compounding the situation. 

Additionally, airlines stopped hiring new pilots during the epidemic, making the situation worse. Furthermore, last year, the industry’s severe slump may have scared away some prospective pilots, resulting in a smaller pool of future pilots entering the pipeline. According to consultants at Oliver Wyman, a shortage of more than 12,000 commercial airline pilots in North America might occur by 2023 due to this trend. 

Mandatory Retirements Characterized the Decade of the 2000s.

Before the outbreak of the pandemic, airlines had difficulty filling pilot positions quickly enough. Commercial airline pilots in the United States must retire at the age of 65 under federal law. Many pilots will reach the age of 65 throughout the 2020s, owing to demographic trends and the history of development in the United States airline sector.

That implies that the industry will need to hire a large number of new pilots even before making any provisions for future expansion. According to a 2017 study by Cowen and Company analysts, mandatory pilot retirements at the top five US airlines combined will increase from 1,266 in 2017 to 2,397 by 2021, before reaching a high of 2,641 in 2025.

In addition to other airlines, mandated pilot retirements in the United States may reach more than 3,000 per year by the mid-2020s. Furthermore, the rate of retirements is expected to continue to increase until the 2030s.

It will be difficult to replace all of these departing pilots. The United States military is teaching much fewer pilots now than it did a few decades ago, and training to become a commercial airline pilot is a time-consuming and costly procedure that must be completed privately.

Competitive Wages and Incentives

According to the US Government Accountability Office, significant increases in salary and hiring are recognized economic indications of a labor supply shortfall (GAO). An analysis of the current and future availability of airline pilots by the GAO showed pilot unemployment at 2.7 percent, considerably lower than the general economy. Pilot pay and recruiting did not reflect a scarcity. That’s changed.

The scarcity is caused by rising air travel demand and dwindling labor availability, respectively. “I believe on a national basis, it’s not receiving a lot of attention, but I think it’s a 10,” Reed said when asked how severe the pilot shortage should be.

Unmanned aircraft can’t fly, resulting in flight cancellations or reduced service to certain locations. Some airlines aggressively recruit prospective pilots. To counter this, Some airlines pay $60,000 instead of $20,000 as a start. Moreover, several provide sign-up incentives. Students can now afford the licensing fees and pay off their debt since the salary is higher.  

How Do Salaries Increase?

Each airline has its own wage scale, although most provide yearly increases. With this continuous rise, airline and commercial pilots may expect to earn up to $117,290 a year. Pilots earn the most in their first five years. First officers typically see more significant pay increases than captains, which often happens after a one-year probationary term. After a few years, almost all first officers become captains.

Legacy carriers — the biggest and oldest carriers in the US – compensate their pilots well. For example, a Delta 757 first officer earns $70 per hour the first year and much more than the second. After ten years, a Delta first officer will make $151. A Boeing 757 first officer makes at least $55,000 per year with the 65-hour minimum guarantee and over $120,000 per year with per diem.

Putting it in a Nutshell

For the last several years, ensuring a pipeline of new pilots has been a top priority for airlines all over the globe, particularly in the United States. Sixty-two percent of flight operations executives responding to an Oliver Wyman survey in 2019 identified a lack of skilled pilots as a major concern. The underlying reason for the impending scarcity differs from area to region: For example, in the United States, the workforce is aging and approaching forced retirement, there are fewer pilots leaving the military, and there are obstacles to entry, such as the expense of training.

Nearly suddenly, with the emergence of COVID-19, the debate changed from scarcity to excess. For airlines who were suffering from a pilot shortage, this has given a temporary respite. It will not endure, and choices made today to survive the coronavirus pandemic may jeopardize airlines’ capacity in certain areas to recover and expand in the future.

With a global scarcity of pilots generating plenty of employment possibilities and raising airline wages, airline pilot salaries are a hot subject. Understanding how pilots are paid may help you determine whether this is the appropriate profession for you!