The US government has begun disbursing $15 billion in payroll assistance to airlines, which have been eagerly awaiting the financial relief ever since an earlier programme expired in September.

The support, part of a $900 billion stimulus package designed to support the wider economy as the coronavirus crisis drags on, brings thousands of involuntarily furloughed aviation employees back on to airline payrolls, if only temporarily.

November 2020

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US airlines start tapping in to government aid

Atlanta-based Delta Air Lines says on 15 January that it will receive $2.9 billion in payroll support payments, broken into two parts: a grant of “approximately” $2 billion and $830 million in an unsecured 10-year loan.

Delta says it has received the first instalment of $1.4 billion, and expects to receive the rest during the quarter.

Southwest Airlines also reports on 15 January that it received $864 million, about half of the $1.73 billion it intends to take from the second relief packaage.

Congress passed the 5,600-page bill in late December and it was signed into law by President Donald Trump a week later. The $15 billion is destined for the purpose of helping pay employee wages and benefits for four more months.

These funds come on top of the $25 billion in wage assistance afforded to US passenger carriers under the government’s initial pandemic relief law, passed in March. It expired on 30 September, and with it went job guarantees for thousands of US aviation employees.

Major carriers involuntarily furloughed more than 30,000 employees on that date, with thousands more receiving warnings that their jobs could be in danger if no further government assistance was forthcoming.

In return for the new aid, airlines have pledged to take back the employees they had furloughed at the end of September, and they must keep them on staff until the end of March.

The new relief is, again, temporary, and industry observers say it is unlikely that the global coronavirus pandemic will be over by the end of the first quarter. In addition, it is unclear what the majority of the returning employees will do, since carriers are currently overstaffed.

With coronavirus case counts continuing to rise across the country and new travel rules for all inbound international passengers set to go into effect in less than two weeks, potential travellers continue to be wary about booking trips. 

Airlines hope that customer confidence and demand will return with the nationwide roll-out of coronavirus vaccines, expected in the coming months.