Recession Slowing Down The Hiring??

[commuterguy]

XJT is offering leaves of absense due to overstaffing. They are for 1 to 3 months. Not a good sign.

 

[molson247]

yup....XJT is offering leave of absences now to reduce staffing.....if they can't get enough.....furlough's are the next step. Forget about being hired withXJT for a long time!

 

[FSIGRAD]

Airlines are for the most part pretty short sighted. They tend to hire/run classes right until they furlough.

 

[LearLove]

Airlines are for the most part pretty short sighted. They tend to hire/run classes right until they furlough.

ding ding ding - we have a winner.

 

[LowlyPropCapt]

IMHO, I think it is going to get very ugly.

Historically, it seems the economy's effects on airlines tend to lag a little bit. The fact is, fares are already too low and can't go much lower. Once John Q. Public decides to put off that vacation or his company reigns in business travel, the negative effect on airline bottom lines will be soon to follow.

Remember... Many airlines are making money partly because of artificially low labor costs (those created by BK restructuring and force majeure). I personally think the labor bucket is empty... Management will (and should) have a tough time squeezing more money out of employees when things get tight. What will happen? Consolidation, slashing capacity, all things bad for pilots.

My opinion anyhoo... Worth what you paid for it.

 

[Poahi]

Airlines are for the most part pretty short sighted. They tend to hire/run classes right until they furlough.

Their goal is to make their problem, your problem.

 

[Poahi]

IMHO, I think it is going to get very ugly.

My opinion anyhoo... Worth what you paid for it.

I think most people, and especially cheerleaders for the legacies, tend to miss what happens during an economic slow down. We also tend to have a short memory. Just a couple of years ago, it was hard to find someone who said the housing bubble was going to burst.

911 didn't cause the last downturn in the airline industry - that was well underway earlier that year and the slow down initially affected business travel. This time, oil prices are going to drive a reduction in capacity and an increase in ticket prices. If the airlines are rational, they will raise prices to cover the huge hike in fuel costs. Add to that, leisure travelers will travel less as a recession and increase in unemployment takes hold, and you have a receipe for another perfect storm.

Then there are those that say the weak dollar is going to bail out the majors who fly to Europe and Asia. That isn't going to work either. The weakness in the dollar isn't going to offset $100 oil. They also forget one other thing; our economy is coupled with Asia and Europe. You can't assume our financial problems are contained within our borders. As goes America goes the global economy. Don't believe me, take a look at all of the major global indicies. Being naive is the most expensive thing a pilot can do. Forget the Koolaid and the "my airline's better than yours' rhetoric, no airline is immune to the laws of supply and demand.

 

[CFI2766]

I think most people, and especially cheerleaders for the legacies, tend to miss what happens during an economic slow down. We also tend to have a short memory. Just a couple of years ago, it was hard to find someone who said the housing bubble was going to burst.

911 didn't cause the last downturn in the airline industry - that was well underway earlier that year and the slow down initially affected business travel. This time, oil prices are going to drive a reduction in capacity and an increase in ticket prices. If the airlines are rational, they will raise prices to cover the huge hike in fuel costs. Add to that, leisure travelers will travel less as a recession and increase in unemployment takes hold, and you have a receipe for another perfect storm.

Then there are those that say the weak dollar is going to bail out the majors who fly to Europe and Asia. That isn't going to work either. The weakness in the dollar isn't going to offset $100 oil. They also forget one other thing; our economy is coupled with Asia and Europe. You can't assume our financial problems are contained within our borders. As goes America goes the global economy. Don't believe me, take a look at all of the major global indicies. Being naive is the most expensive thing a pilot can do. Forget the Koolaid and the "my airline's better than yours' rhetoric, no airline is immune to the laws of supply and demand.

One of the best, well thought out, logical posts here on FI. Finally.

It's my opinion that there will be a 'recession' (textbook or main st. definition) until the fear of a stagnating market is overcome by the greed of investors for an emerging market. This is not a bad thing, simply reality. Greed really is good.

 

[norskman2]

Airlines are for the most part pretty short sighted. They tend to hire/run classes right until they furlough.

Hire 'till you furlough, then furlough 'till you hire. At $108 a barrel oil, it's coming.

 

[Poahi]

So who is most exposed to high fuel costs?

RJ opeators- yes to the extent they are are not able to pass on increases and aren't properly gauged.

DC-9 operators. yes compared to similar sized A/C.

*Add your favorite gas guzzler here*

But in the end, I think we are going to see a reduction in frequency, especially for the short hops. That's going to make commuting a real challenge. I remember NWA doing this just after entering bankruptcy.