Worsening Pilot Shortage
06-11-2014 | 07:21 AM
#81
MK Ultra Candidate
Joined: Feb 2013
Posts: 1,167
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From: Prime Leader of Boko Harumph
AOPAs single largest concern is flight training starts and certificate completions. It really is a base level concern. GA flying hours down, the costs of everything from regular MX to engine overhauls goes up due to volume inefficiencies. Look at the price of a gallon of AVgas. How much is a C172 rental at your local FBO? This is about the money, or lack of it. Price the 0-to commercial package at AllATP, then add 1250 more hours to complete the picture. In today's economy who has that kind of cash, because banks nor the federal government aren't loaning nor guaranteeing aviation training loans.
This industry has spent the last 60 years exploiting pilots and it finally is reaping what it has sown.
If you want to look at most regional newhire classes that will tell the story, recycled pilots from other regionals is just shuffling of the deck not adding to the count overall. Want the truth, follow the money trail. The regional industry will eat itself from the sphincter in and when that is complete, the majors will have their bite at the poo sandwich. The truth of the matter is, pilots are highly trained machine operators, with a lead time involved for the training. Airplanes are expensive and even more expensive when they aren't flying. I was around for the Kit Darby years and have been in the airline industry since, these are different times, vastly different. The cost of GA and training is the primary difference.
This industry has spent the last 60 years exploiting pilots and it finally is reaping what it has sown.
If you want to look at most regional newhire classes that will tell the story, recycled pilots from other regionals is just shuffling of the deck not adding to the count overall. Want the truth, follow the money trail. The regional industry will eat itself from the sphincter in and when that is complete, the majors will have their bite at the poo sandwich. The truth of the matter is, pilots are highly trained machine operators, with a lead time involved for the training. Airplanes are expensive and even more expensive when they aren't flying. I was around for the Kit Darby years and have been in the airline industry since, these are different times, vastly different. The cost of GA and training is the primary difference.
06-11-2014 | 07:43 AM
#82
Gets Weekends Off
Joined: Feb 2013
Posts: 3,154
Likes: 18
The majority shareholders are institutions. They make deals and collude together to put their money in certain sectors or stocks. A group of banks, for example will all agree to buy housing stocks, when they are low. Then the, 401K and mutual fund mgrs. will be paid off to buy these stocks, then the talking heads will start pumping up the stock or sector. As the public starts buying, the institutions start dumping--the CEOs are part of the inside club, so they do the same. Then the short options are put on. As the stock crests and tanks, the shorts make money on the downside.
All this has very little to do w/ actual performance of the CEO or company in today's market. So many books are cooked, so many audit firms are on the take, and so many analysts are nothing more than paid shills, that stock price is meaningless w/ regards to performance.
If a stock price is slipping, the company will borrow cheap money to buy back shares to prop it up. At these stock prices, P/E ratios are absurdly high.
All this has very little to do w/ actual performance of the CEO or company in today's market. So many books are cooked, so many audit firms are on the take, and so many analysts are nothing more than paid shills, that stock price is meaningless w/ regards to performance.
If a stock price is slipping, the company will borrow cheap money to buy back shares to prop it up. At these stock prices, P/E ratios are absurdly high.
06-11-2014 | 08:10 AM
#83
Gets Weekends Off
Joined: Oct 2009
Posts: 3,108
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Our leader is in bed with management. He is now toast. If we can get a real leader, regional pilot pay should double or more.
The fearless stand of our regional pilots in rejecting pathatic contracts is paving the way to restoring our profession.
Let's keep up the pressure.
30 year Delta captain.
06-11-2014 | 08:26 AM
#84
Respek
Joined: Jul 2010
Posts: 2,938
Likes: 76
There's a reason that base salaries for Airbus captains in China have risen from about $10K/month to $22.5K/month, in less than 10 years.
There's a reason that EK has hired tonnes of RJ pilots.
There's a reason that Qatar is hiring Direct Entry Captains.
There's a reason that Russia is now allowing US licensed pilots to fly for it's airlines.
There's a reason that some American/Euro pilots are starting to leave the ME and China in large numbers, to return to flying jobs in their home areas.
There's a reason that the regionals are hurting.
There's a reason that airlines like Atlas and DAL/UAL/AA are having guys call in and turn down class dates for them.
Too many pilots is not one of them!
There's a reason that EK has hired tonnes of RJ pilots.
There's a reason that Qatar is hiring Direct Entry Captains.
There's a reason that Russia is now allowing US licensed pilots to fly for it's airlines.
There's a reason that some American/Euro pilots are starting to leave the ME and China in large numbers, to return to flying jobs in their home areas.
There's a reason that the regionals are hurting.
There's a reason that airlines like Atlas and DAL/UAL/AA are having guys call in and turn down class dates for them.
Too many pilots is not one of them!
06-11-2014 | 09:04 AM
#85
Gets Weekends Off
Joined: Aug 2012
Posts: 178
Likes: 0
The problem here is that everyone foaming at the mouth about pilot shortages actually believes the fairy tale that we live in a free market economy and that the supply/demand price curve from Econ 101 (which I'm guessing they don't bother to teach at Riddle and UND anyway) works anymore.
If you follow that basic macro-economic theory, as the number of qualified workers declines, a company will have to pay more to attract better candidates. However, in this Walmartized world, the real world, instead of incentivizing employees to (in this case) staff and improve productivity, the exact opposite is happening. Since profits happen to be shrinking at the same time, regional airline management is coming and demanding concessions, with the threat of complete job loss as the stick. No carrot. Plan B, already in motion, is to whine and lobby lawmakers to change the rules so they can go back to hiring wet commercial licenses and continue to pay poverty wages. Plan C will be the multi-crew licenses that the ICAO is already on board with, with maybe a little Age 70 thrown in for good measure with a hint of empty promises. Legacy/major carriers have no shortage of applicants, but the tipping point is coming at the regionals, why do you think EndeavorToDelta just reared it's ugly head. It isn't about getting people to Delta, it is entirely about getting people to the pilot ghetto at Endeavor. Otherwise, wouldn't they just pay more at Endeavor? There it is. There is no room in this playbook for paying pilots higher wages. The house of cards that is the regional model won't allow for it. The only worry that Legacy carriers have that while they have absolute disdain for their regional partners and their scummy pilots and keep trying to grind them into the carpet to work for free (or better yet, you pay us to fly for us!), they need their precious feed. Don't for a second believe that United is interested in buying 100 seaters to fly to MAF and MOT. They get more from regionals than the regionals get from them, or they wouldn't still be doing it, rhetoric about the 50 seater being an expensive and dying airframe notwithstanding. DAL might be operating slightly smarter with the 717's coming online, but there is still a lot of country out there where real people with money who like to travel live these days, and they can't all support 100 seat jets. The entire paradigm is probably going to have to shift, again, just don't hold your breath waiting for that raise.
If you follow that basic macro-economic theory, as the number of qualified workers declines, a company will have to pay more to attract better candidates. However, in this Walmartized world, the real world, instead of incentivizing employees to (in this case) staff and improve productivity, the exact opposite is happening. Since profits happen to be shrinking at the same time, regional airline management is coming and demanding concessions, with the threat of complete job loss as the stick. No carrot. Plan B, already in motion, is to whine and lobby lawmakers to change the rules so they can go back to hiring wet commercial licenses and continue to pay poverty wages. Plan C will be the multi-crew licenses that the ICAO is already on board with, with maybe a little Age 70 thrown in for good measure with a hint of empty promises. Legacy/major carriers have no shortage of applicants, but the tipping point is coming at the regionals, why do you think EndeavorToDelta just reared it's ugly head. It isn't about getting people to Delta, it is entirely about getting people to the pilot ghetto at Endeavor. Otherwise, wouldn't they just pay more at Endeavor? There it is. There is no room in this playbook for paying pilots higher wages. The house of cards that is the regional model won't allow for it. The only worry that Legacy carriers have that while they have absolute disdain for their regional partners and their scummy pilots and keep trying to grind them into the carpet to work for free (or better yet, you pay us to fly for us!), they need their precious feed. Don't for a second believe that United is interested in buying 100 seaters to fly to MAF and MOT. They get more from regionals than the regionals get from them, or they wouldn't still be doing it, rhetoric about the 50 seater being an expensive and dying airframe notwithstanding. DAL might be operating slightly smarter with the 717's coming online, but there is still a lot of country out there where real people with money who like to travel live these days, and they can't all support 100 seat jets. The entire paradigm is probably going to have to shift, again, just don't hold your breath waiting for that raise.
06-11-2014 | 09:19 AM
#86
Doing One Pilot's Job
Joined: Sep 2005
Posts: 7,889
Likes: 127
The problem here is that everyone foaming at the mouth about pilot shortages actually believes the fairy tale that we live in a free market economy and that the supply/demand price curve from Econ 101 (which I'm guessing they don't bother to teach at Riddle and UND anyway) works anymore.
If you follow that basic macro-economic theory, as the number of qualified workers declines, a company will have to pay more to attract better candidates. However, in this Walmartized world, the real world, instead of incentivizing employees to (in this case) staff and improve productivity, the exact opposite is happening. Since profits happen to be shrinking at the same time, regional airline management is coming and demanding concessions, with the threat of complete job loss as the stick. No carrot. Plan B, already in motion, is to whine and lobby lawmakers to change the rules so they can go back to hiring wet commercial licenses and continue to pay poverty wages. Plan C will be the multi-crew licenses that the ICAO is already on board with, with maybe a little Age 70 thrown in for good measure with a hint of empty promises. Legacy/major carriers have no shortage of applicants, but the tipping point is coming at the regionals, why do you think EndeavorToDelta just reared it's ugly head. It isn't about getting people to Delta, it is entirely about getting people to the pilot ghetto at Endeavor. Otherwise, wouldn't they just pay more at Endeavor? There it is. There is no room in this playbook for paying pilots higher wages. The house of cards that is the regional model won't allow for it. The only worry that Legacy carriers have that while they have absolute disdain for their regional partners and their scummy pilots and keep trying to grind them into the carpet to work for free (or better yet, you pay us to fly for us!), they need their precious feed. Don't for a second believe that United is interested in buying 100 seaters to fly to MAF and MOT, they get more from regionals than the regionals get from them, or they wouldn't still be doing it, rhetoric about the 50 seater being an expensive and dying airframe notwithstanding.
If you follow that basic macro-economic theory, as the number of qualified workers declines, a company will have to pay more to attract better candidates. However, in this Walmartized world, the real world, instead of incentivizing employees to (in this case) staff and improve productivity, the exact opposite is happening. Since profits happen to be shrinking at the same time, regional airline management is coming and demanding concessions, with the threat of complete job loss as the stick. No carrot. Plan B, already in motion, is to whine and lobby lawmakers to change the rules so they can go back to hiring wet commercial licenses and continue to pay poverty wages. Plan C will be the multi-crew licenses that the ICAO is already on board with, with maybe a little Age 70 thrown in for good measure with a hint of empty promises. Legacy/major carriers have no shortage of applicants, but the tipping point is coming at the regionals, why do you think EndeavorToDelta just reared it's ugly head. It isn't about getting people to Delta, it is entirely about getting people to the pilot ghetto at Endeavor. Otherwise, wouldn't they just pay more at Endeavor? There it is. There is no room in this playbook for paying pilots higher wages. The house of cards that is the regional model won't allow for it. The only worry that Legacy carriers have that while they have absolute disdain for their regional partners and their scummy pilots and keep trying to grind them into the carpet to work for free (or better yet, you pay us to fly for us!), they need their precious feed. Don't for a second believe that United is interested in buying 100 seaters to fly to MAF and MOT, they get more from regionals than the regionals get from them, or they wouldn't still be doing it, rhetoric about the 50 seater being an expensive and dying airframe notwithstanding.
The issue, for contract lift providers, is that mainline isn't going to pay them more than the contract requires to cover the increased labor costs that the supply-demand equilibrium now demands after the supply of "qualified" pilots willing to work for regional airline compensation was artificially reduced due to 121.436.
As such, management of CLPs are in a pickle - they can't increase revenue, so their only option is to control or reduce costs which is why there's such an emphasis on concessionary and cost-neutral CBAs right now. Pilots are largely rejecting this, creating yet another problem for managements - pilot recruitment and pilot retention. Regionals WANT their pilots with more longevity to leave since they are more expensive, but the issue is replacing that pilot due to all the above.
Lacking incentive, pilots are voting with their feet.
The contract lift providers that ultimately survive will be the ones that are more attractive for potential newhires due to compensation and quality of life, and they will eventually have more pricing power with their mainline partners as the options will be fewer.
As you said, RAA and their members probably have multiple 'contingencies' to fall back on, but ultimately, it boils down to increasing the supply of pilots willing to work for regional airline compensation.
/no, Econ isn't part of the Purdue AvTech curriculum
//really should be
///Ivy Tech and Ball State MBA FTW
////four slashies for four stripes
06-11-2014 | 09:22 AM
#87
Thread Starter
Gets Weekends Off
Joined: Mar 2007
Posts: 3,215
Likes: 0
From: Capt
The pilot shortage has 0 to do with us regional airlines. It is happening because there are less pilots availabilie to fly transport category aircraft, worldwide, than there are needed to man the aircraft that the airlines want to fly....they are also shortages at the biz jet level.
06-11-2014 | 09:25 AM
#88
Doing One Pilot's Job
Joined: Sep 2005
Posts: 7,889
Likes: 127
06-11-2014 | 09:26 AM
#89
Working weekends
Joined: Jul 2005
Posts: 2,384
Likes: 0
From: Left Seat
The pilot shortage has 0 to do with us regional airlines. It is happening because there are less pilots availabilie to fly transport category aircraft, worldwide, than there are needed to man the aircraft that the airlines want to fly....they are also shortages at the biz jet level.
06-11-2014 | 11:23 AM
#90
Respek
Joined: Jul 2010
Posts: 2,938
Likes: 76
The pilot shortage has 0 to do with us regional airlines. It is happening because there are less pilots availabilie to fly transport category aircraft, worldwide, than there are needed to man the aircraft that the airlines want to fly....they are also shortages at the biz jet level.
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