Pilot Shortage And The Legacy Feed
 

Highlights...

Age 68 retirement

Ok..I'll bite, this is JMHO, but

Mainline will continue to recapture RJ flying, begin flying large RJ's at mainline, cherry-pick profitable routes as RJ operators shrink and leave numerous cities petitioning for EAS designations to at least see service from Great Lakes as an alternative to driving a couple hours to the closest legacy spoke city.

DL already has CRJ900 and E190 rates, age 65 retirements haven't even kicked in yet but are expected to reach 600/yr in the next 3 yrs. and the same thing is happening at the other legacy's. Even if they recinded the 1500 rule, there aren't enough pilot starts to cover the future movement of current RJ pilots to mainline. The course is set..RJ providers will start to shut down, smallest to largest, in the near future. Raising RJ pay won't stem the tide, cause mainline will be flying large RJ's at mainline rates..and only the senior RJ lifers will hang on for QOL.

ULCC's may try to fill the void as cities lose service. Allegiant is a great example of finding city pairs that can be profitable, but we're talking about the very smallest markets that lose RJ lift, and even Spirit will have trouble filling a 320 for $9/seat on a routine basis cause there just aren't enough O&D pax. If there are enough pax to go around, the legacy's will still service that city with mainline RJ's.

As the available pool of approx 11K mainline applicants shrinks, junior ULCC pilots will start to look at their options. We had JBU captains return to DL last year as their last chance to return from furlough after 9/11 expired. I don't pretend to know why, but there was movement from a LCC to DL, so I can only expect that to happen in the future as seat progression and new-hire QOL improves at the legacy's. We just had a 2014 new-hire get the right seat in the 330 in NYC, and others are getting SEA, LAX, SLC right out of training. There's a lot of opportunity out there, and RJ/LCC/ULCC pilots will have lots of options moving forward.

Of course, all of this is subject to change depending on the news ticker of your favorite network. And I'm just a guy who raises the gear for a living, but the future looks very bright for those pilots who take advantage of those options.

JMHO..

I think there might be a flaw in this reasoning. I hypothesize some of the non-wholly owned carriers will be the first to shutdown. Yes, of course we will see the Great Lakes and the likes shut down this year, but think about this for a moment-

American and Delta have the money to throw at their wholly owned carriers in the form of bonuses etc.. Pilots are seeing that at Endeavor now with their $20,000 per year retention bonus. However Skywest and Republic are two of the largest regional airlines. They will not have that luxury and as a result pilots will not work there because they have nothing to offer in the form of bonuses or flows etc.. or even quick upgrade. Republic is cancelling flights today for lack of crews to fly the airplanes and we are just getting started with this tight labor market. I know really nothing about skywest but I have to imagine the situation will be the same if it is not already.

With more airplanes available to fly then crews to fly them, pilots will not pick these carriers with nothing to offer. Current pilots at these airlines may be many of the first chosen in mass at the big 3 legacy airlines as there is not a flow or any kind of agreement that prevents the big 3 from draining them in their entirety, unlike wholly owned carriers whereby the mainline parent won't destroy their own feed and implement flows to slow the regional pilot exit.

Ultimately what you may see is Republic becoming competition running its own ticket selling operation or turning into an airplane and pilot leasing company. If Republic were to become a leasing company, now it is setting its own rates and charging the airline a more realistic fee as opposed to today's scenario under Fee For Departure.

On an unrelated note, one thing seems fairly clear to me though is that mainline pilots and their unions better get a handle on scope. Otherwise major airlines will be nothing more than ticket selling and marketing companies who contract out to other "contract carriers" to do all their flying whipsawing one carrier against the other.

It would be interesting to factor in, over the next generation, projected increase in passenger travel demand. Couple that with fewer pilots and we might be in for a real wild ride!

Eventually, if the most dire pilot shortage forecasts are truly realized, won't companies and regulators be forced to create pilot farms? Won't they change the laws?

And finally, just so I'm getting all this right... Are we pilots accepting the pilot shortage myth now as truth? Or are we still rejecting it? I'm just so confused:o

Well, to repeat what someone once said, there isn't a pilot shortage, just a shortage of pilots willing to work at the current pay scales.

To MAY to, To MAH to. I know.

Thing is, I will believe there is a true shortage when the carriers have to hire off the street and pay for training.

Why decrease route structure when you can just decrease frequency, more than likely increase seat availability and first class options potentially increasing revenue. All can be done by putting a mainline aircraft on RJ routes. Pull 2 50 sweaters off the same city pair, fill in with an airbus or 737. You just cut pilot requirements in half, potential increase in revenue to make up the labor costs, helped alleviate the pilot shortage and even the RJ pilots don't lose because they need to get hired at mainline to fill those seats.

And the beautiful thing? It's already happening and will continue to happen. Delta started this a few years ago flying DC9s, MDs and Airbus on short flight such as ATL-TYS or to VPS or CAE.
United is doing the same and just announced between 10-20 used Airbus that will be used to replace 50 sweaters that are going away at an accelerated rate.

All that remains is for us at mainline to hold strong on scope (delta you're next) and it benefits all current and future pilots.

Age 68 gets tossed around but at worst it just pushes this *crisis* back 3 years. Doesn't fix anything.

Everyone is so focused on the small end, but how many pilots does it to staff one 777? Maybe 20?

You're 20 pilots short on your staffing plan, do you park 2-3 RJs (having your 20 pilots fly at $200k+ a year) or do you find a way to defer the delivery of one 777 (and those 20 pilots then make $30k/yr) and have that route be flown by a revenue sharing joint venture, where those jobs are now at a foreign carrier?

Unfortunately the answer seems to be: both.

But, the top end is much harder to get a handle of, get an idea of how many jobs have been lost, and to protect against. It sure is scary.

FWIW......refute as desired....

If China/Asia gets serious about their pilot shortage, we might be in for H1B visa candidates coming this way, as opposed to today where the flow of pilots goes the other way. Think of all the foreign doctors and IT workers we have in America. I know pilot training overseas is expensive right now, but that can change. China is an expert in doing all things cheaply and profiting.

I think we are. And I say that based on a curious statement from ALPA the other day. I'm paraphrasing here but something along the lines of "while there is no current pilot shortage today, if something isn't done to attract pilots there will be a pilot shortage in the future". For all intents and purposes I believe even ALPA can no longer deny there is a pilot shortage. Today its a shortage of pilots who are not willing to work for what the regional airlines want to pay, but tomorrow it will be a real pilot shortage because what's happening today does nothing to put people in the pipeline for tomorrow. The store is empty, but its hard to see that because your cupboard still has cans in it.

i believe they will get mainline seniority numbers out of flight school, and the mainline will just regulate the flow to what they need for feed or main, as well as institute a "C" scale of pay. Nobody will ***** cause at least they know someday they will get the big jet...even if its 20 yrs down the line.

Maybe college graduates will need an agent and there will be a draft :p

With a "C scale" they will need food stamps and a cardboard box/residence allowance.

Supply and demand for pilots is the only thing that is going to bring wages up in this industry, it'll do leaps and bounds more than picketing and negotiating and flight bag stickers ever will.

Our job needs to be to make sure they don't figure out..

A way to increase supply... raising the age limit, decreasing the hour requirements, etc

A way to decrease demand... single pilot, loosened rest regulations, outsourcing to foreign carriers, etc


If we do these two things, everything else, from pay to scope to retirement to benefits to... etc... will take care of itself. Hopefully the major unions can figure this out before we screw it all up.

Pay them and they will come

Large aviation universities (ERAU...) have been sponsoring H1-B visas for flight instructors for quiet some time now.

So it's all been very hush-hush?

Not really. It's perfectly legal. The universities petition to the Department of Labor clearly stating the lack of workforce in that particular field. H1-Bs are valid for three years, renewable once. It takes 3-5 years for an adjustment of status to a green card, necessary for one to apply at a regional. So universities get at least a 5 years commitment from the CFIs needing to go through this process. They can petition for work permits only if they can demonstrate that there are not enough US citizens or permanent residents to fill the spots, which has been the case lately.

Shhhhhhhhhhhhhhhh

So where are US citizens going to build up their time? 250 to 1500 hrs (for ATP) takes some time. I would have thought that ERAU would have more than enough US citizen grads to fully staff their CFI needs.

There is also some sort of scheme where working as a CFI is included in the education visa. About 1/4 of CFI's at the school I went to were on this visa, and they held stage check instructor positions as well. I assume they were just staying as long as they could to get the green card. After 9/11, they all left.

Dumb article. Legacy airlines will always always always have first pick of applicants over any and all LCC's in almost every case. Including applicants at the LCC's themselves. And transferring capacity to mainline only results in a few super small markets closing. Markets in which LCC's don't serve anyway. Legacy airlines could shut down any LCC they wanted to just with targeted hiring if necessary. Advantage: legacy airlines. Big time.

Eldee5's comment about H1-Bs has me wondering. What are US pilots doing to get enough flight hours for an ATP?

I had thought that jobs such as CFI were how most US pilots were building their time. I find it shocking that flight schools are getting H1-Bs due to a 'shortage' of US citizen CFIs.

I could be wrong, but I took the author to mean that Legacy airlines were exposed to the risk of shortage due to their regional feed. When Connection/Express carriers can't attract applicants, Legacy passengers will be affected. I don't think the author of the article was saying that mainline carriers will directly experience a shortage of applicants. LCCs are exposed to less risk due to the fact that they operate all of their own flights and don't have to worry about regional partners staffing their flights.

Here is an idea....park the RJs and buy some used mainline jets

From United's first Qtr Earnings report:


*Complete the removal of more than 130 50-seat aircraft from its schedule by the end of 2015. UAL will remove additional 50-seat aircraft in 2016 and beyond as aircraft come off lease.

*Acquire additional used narrowbody aircraft. The company is in final negotiations regarding the lease of 10 to 20 used narrowbody aircraft for delivery over the next few years. In addition, the company plans to continue to seek other opportunities to acquire used aircraft to meet its needs as market conditions allow.

It is about much more than supply and demand. H-1B visa holders are an HR department's dream employee. Desperate, completely dependent on the employer's good graces and with no options.

Look at the tech industry. There is no lack of United States citizens in electrical engineering and software, but a crisis is manufactured so that companies can hire young, desperate worker bees via the H-1B visa program and avoid those pesky 30 year old + citizens with their "rights" and expectations of humane treatment.

Step 1: CFI
Step 2: part 135 cargo flying single pilot all-Wx OR remain a CFI, get CFII, and then MEI
Step 3: Regional airline OR part 135 in crewed, typed turbine aircraft
Step 4: Major/Legacy carrier


Glad you liked it. I'll keep posting more as I come across them. Just for you. ;)

And a certain political party's #1 demo, too, for the reasons outlined and which also absolutely DESTROYS the popular rhetoric one hears from that same party's baggage handlers.

I've been stalling on getting my cfi for financial reasons, but I think you're definitely onto something here.
You really need to get the cfi in order to make it to 135 mins. Seems backasswards to have the blind leading the blind but it seems that's how this game is played ...

I'm well aware of both sides of the H1-B debate. That wasn't my question.

As for the comments that ERAU has a bunch of CFI H1-Bs working for them for peanuts, the data indicates otherwise.
Embry-Riddle Aeronautical University, Jobs & Salary for Foreign Workers | myvisajobs.com
H1B Visa: Search Employer, Job Title, Work City, Work State, Status and Case Number | MyVisaJobs.com
Instructor Pilot Hiring

I just talked to an ex ERAU CFI. Said there are a lot of lifers there. Guys left to the commuters and couldn't do it, came back to ERAU.

Ouch. Embry-Riddle Aeronautical University Salaries | Glassdoor
Money's not everything, but being a CFI for life is not even going to pay your student loans.

Also guys who can't get a 1st or 2nd class medical. I know of at least one but have heard there are more.

That's also what I thought it was saying. But I disagree with the conclusion. So what if a few tiny markets disappear? It won't be many. So much of the RJ glut is the failed Fred Reid et al model of "the businessman likes frequency!" of hourly flights from every hub by every airline to every city. It was stupid then and its even dumber now. There is still a LOT of slop that can come out of the regional so called "feed" system.

There is also a lot of regional capacity that can be replaced with mainline on a 3 to 1 savings for staffing.

Other than perhaps dinging the 100% completion and on time fantasy metrics, we're no where near a regional pilot supply crunch actually endangering the legacy airlines.

Besides, legacy airlines can ramp up LCC pilot hiring any time they want to. Now THAT could crush more than a few business models out there.

That's cool. Just don't hold your breath waiting for legacy collapse because of a regional pilot crunch, cause it ain't gonna happen. :cool:

United has over 10,000 applications on file. I would imagine Delta, American, Alaska, and Hawaiian are in a very similar state. There is no pilot shortage at the majors nor will there be for a very long time. The regionals are crying because the bar has been raised to the minimum. If starting pay at a regional was $45K and average pay was $85k the regionals would have no staffing issues. A college graduate with a technical degree should not have to collect food stamps for his first 2 years after graduation.
The pipeline of qualified applicants is drying up. There is very little incentive for someone to start training today for an airline job.
Given the current state of this industry, when I am asked, I strongly deter anybody from starting to fly as a career interest. Hobby, absolutely. Business expedience, absolutely. Career, NFW!

Most agree it's the same 10,000 applicants to all companies. With 21,000 retirements in the next 10 years they will need more applicants.

Many twenty somethings I personally know are busy preparing to buy houses, new cars, and investing in their retirements. I know no one interested in taking flying lessons from this age group, but they always ask me what for? they're not interested in flying for fun unless it pays big money out of the gate.

21K pilots. That sounds like the approximate number of regional pilots. If regional airlines disappeared, bringing all of that flying back to mainline, would anyone be upset?

IF a shortage did materialize (that's a big if), there would probably be a few regionals, LCCs, and ULCCs that went out of business due to them not being able to hire pilots at food stamp wages. I don't see a problem here.

Majors that pay good wages won't have problems recruiting pilots. Airlines that can't compete with living wages will go out of business. It sounds like Sun Country (I thought they went out of business years ago) may close its doors because management says that they can't pay their pilots higher wages. Sun Country Airlines owner warns of possible shutdown | Duluth News Tribune
After looking at their pay scales, Sun Country needs to be shut down. And every single pilot there could find a higher paying job somewhere else.

This is capitalism at work, shut it down if it will be unsafe or unprofitable. Or raise prices. System works as designed.