CX Director Flight Ops: "Young pilots don't want pensions or medical care"
Pilots turning scarce as demand takes wing
After years of layoffs and pay cuts, expansion of air travel creates shortage of qualified crews
By Julie Johnsson
Tribune staff reporter
Published February 4, 2007
For the first time since the Sept. 11, 2001, attacks, all major U.S. airlines are hiring pilots or recalling those laid off during the industry's five-year downturn.
But the airlines are discovering that many of the 10,000 pilots who lost their jobs during those bleak years aren't interested in returning to their old lives.
Many pilots, faced with salary cuts of 35 percent or more, moved to overseas carriers, such as Emirates Airline and Cathay Pacific Airways Ltd. Others took higher-paying jobs with overnight carriers such as FedEx Corp. and United Parcel Service Inc.
Joe Marquardt, 50, left a 17-year career at Northwest Airlines last year for Emirates, as the Minnesota-based carrier phased out the DC-9 jets he flew.
He already had lost one-third of his salary in pay cuts, Marquardt said, and he faced a demotion to a smaller plane, which would mean another pay reduction.
"It got to the point where we couldn't keep the house," Marquardt said.
Now, Marquardt enjoys a life of golf and beachcombing in Dubai, as well as the free housing provided by Emirates, which employs him as a Boeing 777 captain.
"It's hard to match that back home," Marquardt said.
After slashing pilot jobs and pay to survive the last downturn, old-line carriers may find it tougher to hire pilots to keep pace with the industry's rebound, experts say. In fact, they appear to be facing a shortage in the decade ahead.
The trend is a byproduct of the loss of financial security and prestige suffered by the airlines that have long dominated U.S. travel, increased recruiting of American pilots by foreign carriers and the global boom in commercial aviation and airliner sales.
"It is a wild and crazy time, and it's really just begun," said Kit Darby, an expert on pilot hiring trends and pay. He is president of Atlanta's Air Inc.
About one-third of the world's airline pilots work in the United States, the largest market for air travel. But U.S. pilots are becoming hot commodities for overseas carriers, which need large numbers of experienced pilots to fly the fleets of wide-body aircraft they have on order from Chicago's Boeing Co. and Europe's Airbus SAS.
Boeing predicts that the total number of planes used by airlines around the world will more than double by 2025, to 35,970. To keep pace, Darby estimates airlines will need to hire more than 210,000 pilots globally, more than double the number currently working.
Moving the mandatory retirement for pilots to age 65 from age 60, as proposed by the Federal Aviation Administration last week, will help a little. Darby estimates that relaxing retirement rules will reduce U.S. airlines' hiring by about 3,800 jobs during the next five years.
"That's only a drop in the bucket compared to the need," he said. "There are many, many airplanes coming, and with them large increases in air service."
Demand from light jets
That's not including the competition for pilots that airlines will face from air taxi operators flying a new breed of jets that carry between three and five passengers.
Merrill Lynch estimates that 925 of these aircraft, known as very light jets, will be delivered by 2010. That's up from the 21 jets that rolled out of factories in 2006. And all of these planes will need certified jet pilots in their cockpits.
Don Osmundson, vice president for flight operations at Florida-based DayJet Corp., said his company plans to hire about five pilots for each of the 239 Eclipse 500 jets it has on order.
Once it passes regulatory hurdles, DayJet plans to fly business travelers to destinations of their choosing in Florida and, eventually, other states in the Southeast. DayJet doesn't plan to fly on weekends, and its pilots will return to their home bases every evening.
Osmundson hopes that will be a draw for airline pilots, sick of a vagabond lifestyle that involves days away from home. He says DayJet has received 1,700 applications, many of them from airline pilots who either opted for early retirement or were forced from their jobs at age 60.
"The fact is that even at the major carriers, the job is not what it used to be," said Osmundson, who's a former vice president at Continental Airlines.
Many pilots still aspire to fly large aircraft for major carriers such as Elk Grove Township-based United Airlines, which has about 6,500 pilots, down from more than 10,000 in 2001. Captains at these carriers still earn six figures and have jobs that let them see the world.
But such jobs are no longer considered aviation's plum posts: Pilots' hours are longer, and their pay is lower.
United Airlines has offered jobs to all of the 2,172 pilots it furloughed, industry parlance for "laid off," during the downturn. About 1,000 of them have returned to the airline, while others passed on the initial job offers.
Now, United is moving through its list of furloughed pilots, whittled down to about 800, for a second and final time as it plans to add 300 pilots this year.
"Guys have to make a decision whether they're coming back to United or not," said Steven Derebey, a Boeing 737 captain at United and spokesman for its pilots union. "When they reach the end of that
Pilots turning scarce as demand takes wing
After years of layoffs and pay cuts, expansion of air travel creates shortage of qualified crews
By Julie Johnsson
Tribune staff reporter
Published February 4, 2007
For the first time since the Sept. 11, 2001, attacks, all major U.S. airlines are hiring pilots or recalling those laid off during the industry's five-year downturn.
But the airlines are discovering that many of the 10,000 pilots who lost their jobs during those bleak years aren't interested in returning to their old lives.
Many pilots, faced with salary cuts of 35 percent or more, moved to overseas carriers, such as Emirates Airline and Cathay Pacific Airways Ltd. Others took higher-paying jobs with overnight carriers such as FedEx Corp. and United Parcel Service Inc.
Joe Marquardt, 50, left a 17-year career at Northwest Airlines last year for Emirates, as the Minnesota-based carrier phased out the DC-9 jets he flew.
He already had lost one-third of his salary in pay cuts, Marquardt said, and he faced a demotion to a smaller plane, which would mean another pay reduction.
"It got to the point where we couldn't keep the house," Marquardt said.
Now, Marquardt enjoys a life of golf and beachcombing in Dubai, as well as the free housing provided by Emirates, which employs him as a Boeing 777 captain.
"It's hard to match that back home," Marquardt said.
After slashing pilot jobs and pay to survive the last downturn, old-line carriers may find it tougher to hire pilots to keep pace with the industry's rebound, experts say. In fact, they appear to be facing a shortage in the decade ahead.
The trend is a byproduct of the loss of financial security and prestige suffered by the airlines that have long dominated U.S. travel, increased recruiting of American pilots by foreign carriers and the global boom in commercial aviation and airliner sales.
"It is a wild and crazy time, and it's really just begun," said Kit Darby, an expert on pilot hiring trends and pay. He is president of Atlanta's Air Inc.
About one-third of the world's airline pilots work in the United States, the largest market for air travel. But U.S. pilots are becoming hot commodities for overseas carriers, which need large numbers of experienced pilots to fly the fleets of wide-body aircraft they have on order from Chicago's Boeing Co. and Europe's Airbus SAS.
Boeing predicts that the total number of planes used by airlines around the world will more than double by 2025, to 35,970. To keep pace, Darby estimates airlines will need to hire more than 210,000 pilots globally, more than double the number currently working.
Moving the mandatory retirement for pilots to age 65 from age 60, as proposed by the Federal Aviation Administration last week, will help a little. Darby estimates that relaxing retirement rules will reduce U.S. airlines' hiring by about 3,800 jobs during the next five years.
"That's only a drop in the bucket compared to the need," he said. "There are many, many airplanes coming, and with them large increases in air service."
Demand from light jets
That's not including the competition for pilots that airlines will face from air taxi operators flying a new breed of jets that carry between three and five passengers.
Merrill Lynch estimates that 925 of these aircraft, known as very light jets, will be delivered by 2010. That's up from the 21 jets that rolled out of factories in 2006. And all of these planes will need certified jet pilots in their cockpits.
Don Osmundson, vice president for flight operations at Florida-based DayJet Corp., said his company plans to hire about five pilots for each of the 239 Eclipse 500 jets it has on order.
Once it passes regulatory hurdles, DayJet plans to fly business travelers to destinations of their choosing in Florida and, eventually, other states in the Southeast. DayJet doesn't plan to fly on weekends, and its pilots will return to their home bases every evening.
Osmundson hopes that will be a draw for airline pilots, sick of a vagabond lifestyle that involves days away from home. He says DayJet has received 1,700 applications, many of them from airline pilots who either opted for early retirement or were forced from their jobs at age 60.
"The fact is that even at the major carriers, the job is not what it used to be," said Osmundson, who's a former vice president at Continental Airlines.
Many pilots still aspire to fly large aircraft for major carriers such as Elk Grove Township-based United Airlines, which has about 6,500 pilots, down from more than 10,000 in 2001. Captains at these carriers still earn six figures and have jobs that let them see the world.
But such jobs are no longer considered aviation's plum posts: Pilots' hours are longer, and their pay is lower.
United Airlines has offered jobs to all of the 2,172 pilots it furloughed, industry parlance for "laid off," during the downturn. About 1,000 of them have returned to the airline, while others passed on the initial job offers.
Now, United is moving through its list of furloughed pilots, whittled down to about 800, for a second and final time as it plans to add 300 pilots this year.
"Guys have to make a decision whether they're coming back to United or not," said Steven Derebey, a Boeing 737 captain at United and spokesman for its pilots union. "When they reach the end of that
- , they will have to start looking to the outside for new pilots."
FedEx and UPS, whose pilots were once derided as "cargo dogs," have long since displaced United Airlines, US Airways and Delta Air Lines at the top of the pay scale in the United States. The most senior pilots at the freight carriers earn about $40,000 more annually than their counterparts at the old-line carriers.
Foreign flag carriers, who would not have contemplated luring pilots from the major U.S. airlines during the 1990s, are holding recruiting drives here.
Cathay Pacific hired about 55 American pilots last year to fly its Boeing 747 cargo planes, said Nick Rhodes, director of flight operations for the Hong Kong-based airline.
Cathay, which has a cargo base in Chicago, plans to add 65 U.S. pilots this year and close to 100 in 2008, said Rhodes. About 10 percent of the carrier's 2,100 pilots are Americans, most of whom joined the airline during the past three to four years.
The six major U.S. airlines are adding pilots to replace those lost to retirement and attrition, and to keep operations moving smoothly as they keep their airplanes in the air for longer stretches of time.
So far, Continental Airlines and Delta Air Lines are the only two who are seeking new pilots. Continental Airlines plans to hire 336 pilots in 2007, after adding 491 in 2006. Delta Air Lines, which saw a large number of pilots take early retirement, plans to hire 200 pilots during 2007.
American Airlines, meanwhile, began recalling the first of its furloughed pilots in January. The nation's largest airline plans to rehire 70 pilots through April, then add about 30 pilots per month after that.
US Airways plans to recall 284 pilots this year, while Northwest Airlines says it will rehire 150 pilots in the first six months of 2007.
The carriers will need to step up hiring as they replenish their aircraft fleets, something Boeing executives predict will happen during the next two years. And that's when the real hiring crunch will begin, Darby predicted.
Training adds to cost
Airlines will face large training costs to bring on the new cadres of pilots, an expense most haven't encountered since 2001. And any shortages could give pilots unions additional leverage to seek higher wages from the carriers.
"It's a huge need, and they're going to be working hard to solve it," Darby said.
Others are more optimistic.
"It's possible you'll see some spot shortages, but I really don't think you'll see long-term shortages," said economist Daniel Kasper, managing director and head of the transportation practice at LECG Group, a Boston-based consulting group.
"To the extent that airlines are having trouble finding pilots, salaries will go up, and that will draw military pilots."
Even so, old-line carriers no longer can claim a monopoly on hiring the best and the brightest pilots.
The best recruiters, the overseas airliners are discovering, are the pilots themselves. Marquardt, for one, has started a blog for pilots pondering following in his footsteps.
Cathay Pacific is drawing pilots in their mid-30s from the likes of United Airlines, who are impatient to fly the new Boeing 777 and 747 aircraft. They would have to wait a decade for such jets at American carriers, which reserve their biggest aircraft for pilots with the most seniority.
"Young pilots don't think about [pensions] or medical care. They just want to strap themselves into a new 777," Rhodes said.
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