AGDP

Any chance of this going back to the old days of essentially minimum wage?

I'm new to the industry and I'm interested in how things have shifted in the past. Obviously, current regional pay rate were implemented during a time when the industry needed the personnel. However, with the glut of current qualified pilots, do we see this going the other way in terms of pay?

For example, Envoy extended their Fuente rates through the end of 2026 - but what happens in 2027? What does the contract stipulate?

demonrat

They will pay you as little as you allow them.

QRH Bingo

Precisely. Those companies which have not made their raises permanent will likely roll them back when able. Companies with rates as a permanent fixture in their contract will see pay stagnate when negotiations come back around as the companies refuse to renegotiate higher rates. Negotiations will drag on without a new contract or higher pay as companies dig in.

Complicate matters with the abundance of what-will-be-by-then 2,500+ hr non-ATP pilots looking for any gig that will give them an ATP and part 121 experience as they come racing to the bottom. The hunger games will be fierce.

Let's hope it does not come to that.

TransWorld

Essentiallu minimum wage? I don't believe so. That train has left the station.

AerChungus

I don't think we will ever see the return of minimum wage pay. But with the next significant economic downturn, I would expect to see rates go back down. If I were to take a guess, probably back towards the $50-$60/hr range for new hire FOs.

There has been a practically endless supply of 1500 hour pilots desperate to fill the right seat ever since the AA wholly-owneds were the first to slow hiring in summer of 2022. The issue has never been this; the issue is getting those pilots to stay and upgrade. For now, there is still just enough leverage on the captain side that regionals need to try to retain what few bodies they have in the left seat. Since DECs haven't been a sustainable staffing solution since anybody who wanted to make the jump from 91/135/extended-period-of-not-flying has already come and gone to a major, regionals are forced to stay just competitive enough that some people will consider upgrading. At my old regional, the only ones who would really upgrade were the lifers, the people with some legal/checkride/financial skeletons in their closet, flow die-hards, Australians, and people who lived a 2-3 hour drive from our base, couldn't really drive anywhere closer, and the only other airline with a base in that city was the mainline. Everybody who didn't really fall into one of those buckets (at my regional, at least), was out as soon as they got a call from somewhere else, either before upgrade (if Frontier, Spirit, or JetBlue) or just out of upgrade (for legacies, if they didn't call even sooner).

This stream of CA upgrades is barely enough as it is, but now Spirit, Alaska, United, FedEx, UPS, and Southwest are either not hiring or not running classes while JetBlue, Frontier, Hawaiian, Delta, and American are running fewer classes than they have in the past few years. Now a lot of regional FOs and junior captains aren't able to leave their regional because there aren't enough jobs to go around and they are largely being outcompeted by Spirit pilots fearing bankruptcy and iAero pilots who just lost their jobs. 350 hours as an FO on an Embraer just isn't gonna cut it anymore when you're competing against people with 5000 hours and some PIC time on the 320 and 737. So ultimately, the leverage is going to fade, especially as the backlog of people unable to escape the regionals starts piling up in the left seat. And though there are still a good amount of retirements on the way, namely at American and United, I just don't see demand for pilots ever going back to what it once was.

So next time there is a downturn, I would expect the legacies to start the whipsaw again as we hit the low point of the cycle in this industry. We saw it happen most recently with CommuteAir and ExpressJet and I wouldn't be surprised to see American decline to renew their pay raises with their WOs, for United to try to whipsaw Mesa, CommuteAir, and GoJet against each other, and for Delta to maybe even try to see if they can get Republic and Skywest to butt heads. All the while, a lot of the "borrowed" flying that mainlines are doing in house, e.g. SLC-STL, will get farmed back out to the 175s as scope clauses allow. Why? Because as others said, they will pay regional pilots as little as they can. And when the supply and demand curve is reversed, they will look to drive costs down all over again. This is the whole reason they kept the regionals afloat for the past 3 years, so that they could wait until the hiring environment stabilized and then bring things back to the status quo. It was cheaper than letting them fail and permanently have mainline do the flying in-house. It's the very definition of the business model; do mainline flying for the same revenue at a lower operating expense.

At least that's what's written on my tin foil hat

rickair7777

^^^ What he said.

The majors obviously propped up the regional system when they could have just brought it all in house post-covid to ease their pilot shortage problem.

They invested in preserving the system and will expect to get a return on that investment.

Even if they don't employ much whipsaw, inflation will take a toll over the years. History has shown that regional FO's will work for intern wages and a shot at the bigs, and regional CA's will work for low/middle white-collar wages (they still get more time off than cube workers).

But it's not all about keeping pilot pay low, a lot of it has to do with other regional employees, all of whom are easier to replace than pilots. Legacies don't want all of those folks in-house, ensconced in union fortresses. Also the legacies do like they idea of a pilot "internship", they'd rather see how you operate in the real world for at least a couple years before putting you in a widebody. You get more sets and reps at the regionals, and also the opportunity to screw up on overnights, etc.

hindsight2020

Well said. It is the civilian equivalent of the "run the clock offense" play that the DoD runs on AF pilots again and again. And if I was in management, that's exactly what I'd do too. It was a rational play to subsidize the FFD thing for the past 3 years, I think the play will pay off for them.

For the fairweather fans who jumped in the fray, this is no different than my wife's occupation immediately post COVID (RNs, travel nursing in particular). People flock to the perception of easy money:effort ratio vocations, always as a lagging indicator. The last bunch of folks are usually the ones who get burned by the promises of those before him/her (not much different than the outcomes of ponzi schemes, except of course the mechanism of payment is not the common denominator nor the issue at hand here). Nothing new under the sun. Caveat emptor.

That said, it's unlikely the wages will reverse to post-911/Lost Decade FFD (inflation adjusted). At this point wage inflation is so high in the aggregate labor market, that non-skilled occupations offer a pretty concrete price floor to backstop the wages of tie-wearing FMS monitors. It'll still be a livable wage, just not as desirable as it was sans the "promise" of mainline shangri-la in 24 months.

HSCompressor

How big is Spirit and Swift? You're acting like their pilot groups total 1/2 million people. According to APC, Swift has 230 pilots TOTAL. 3600 at Spirit, half of them probably don't even half their apps out (bankruptcy or otherwise). They aren't so big it's going to completlely shift hiring for any extended period of time.

Yeah sure, all else being equal they'll hire them over 300 hour RJ fo.

The biggest problem is they have less options because no one wants to drain their own feed. I get what you're saying though. But, it's not going to be their biggest barrier to entry.

SonicFlyer

The unions won't let them lower pay, right?

VacancyBid

Yes, they will when it's required to keep flying.

My guess is that pay will stratify. LCA will become a good career option and paid similar to a major captain. Captain will be well paid enough to keep people a couple years. FO will descend to the lowest bidder.