Another day, another airline announcing massive job cuts. Air France announced on Friday, plans to shed over 7 500 jobs over a span of three years. It predicts a reduction of 6 560 jobs by 2022 and expects over 3 500 natural departures — owing to the airline’s “favourable age pyramid.” Air France subsidiary HOP! will axe around 40% of its existing 2 420 jobs by 2022.
French government officials had earlier warned Airbus and Air France on cutting unnecessary jobs. The Transport Minister advocated for a “reduced work program” to save between 3 000 and 5 000 positions (potentially). But even with government bailouts, airlines are struggling to stay afloat and maintain positions. Air France itself currently employs 41 000 people.
Moreover, it has sustained a 95% drop in revenue in the past three months alone. At the peak of the crisis, the French flag carrier was losing €15 million a day! This has severely downsized its overall operations. It now predicts that 2019 air traffic levels won’t appear before 2024.
Air France will announce the complete reconstruction plan for the group (and HOP!) by the end of this month. This will also include plans for rebuilding the Air France-KLM group
What Happened to the €7 billion Government Bailout?
The French and Dutch government had agreed to €9 billion in loans for the struggling Air France-KLM in April. Air France thinks that the government funding will “enable the Group to withstand the crisis in the short term.” But due to “a lasting decline in activity” it will still have “to reduce its external and internal costs.”
Cutting jobs is one of the easiest ways that airlines use to reduce internal costs.
As far as labour unions are concerned, Air France says it is:
Working together with the unions to implement plans that give priority to voluntary departures, early retirement arrangements and professional and geographical mobility.
In early June, the French government had announced a €15 billion government package to rescue its aviation industry. Strong collaboration between the state and airlines is the only way carriers can weather the crisis.