As air traffic worldwide comes to a standstill, the International Air Transport Association has come back with new projections on the struggling industry, suggesting 25 million jobs are currently at risk.
Region by region, the Middle East has 900,000 jobs at risk, with Africa and North America having two million, Latin America having 2.9 million, Europe having 5.6 million and Asia-Pacific leading with a potential job loss of 11.2 million.
This is estimated to be the case if travel restrictions last for around three months. In that same situation, full passenger revenues would drop by 44% compared to last year, registering a US$252 billion loss. Q2 2020 will be the most damaging point in the year, with demand plummeting by 70% at its worst point, with airlines burning through $61 billion in reserves to stay afloat.
IATA director general and CEO Alexandre de Juniac explained: “There are no words to adequately describe the devastating impact of COVID-19 on the airline industry. And the economic pain will be shared by 25 million people who work in jobs dependent upon airlines. Airlines must be viable businesses so that they can lead the recovery when the pandemic is contained. A lifeline to the airlines now is critical.”
As IATA has done since the COVID-19 situation worsened, it has called on the world’s governments to provide immediate financial aid to help the aviation sector. IATA has called for loans, loan guarantees, support for the corporate bond market and tax relief.
“We have never shuttered the industry on this scale before. Consequently, we have no experience in starting it up. It will be complicated. At the practical level, we will need contingencies for licenses and certifications that have expired. We will have to adapt operations and processes to avoid reinfections via imported cases. And we must find a predictable and efficient approach to managing travel restrictions which need to be lifted before we can get back to work. These are just some of the major tasks that are ahead of us. And to be successful, industry and government must be aligned and working together,” said de Juniac.Looking post-pandemic, IATA has said it will take time for the industry to fully reboot itself, though those 25 million people facing unemployment are dependent on an efficient re-start. The Authority said that re-opening closed borders and agreeing solutions that can be scaled efficiently is vital.