As travel rebounds, airlines offer perks like a $10,000 signing bonus
March 1, 2022
By SARAH FREISHTAT, Chicago Tribune
Airlines are racing to hire workers as they anticipate more travelers returning to the skies, and some are offering incentives to try to draw new employees.
In Chicago alone, United Airlines is offering a $10,000 signing bonus to new part-time ramp agents, baggage handlers, belt and cargo loaders and other positions. Southwest Airlines will increase starting pay for some Chicago roles to $18 an hour beginning March 1.
Major airlines are looking to add thousands of employees this year, as they continue efforts to build back workforces reduced during the pandemic. At the same time, they are contending with tough hiring markets, and could also face a potential pilot shortage that has loomed since before the pandemic.
Staffing has come into sharper focus as airlines are predicting more travelers will return in the spring and summer after dips because of COVID-19's highly contagious omicron variant. In mid-February, the number of passengers on one group of U.S. airlines was down 22% from 2019, according to the trade group Airlines for America. Southwest Airlines was anticipating a rebound from omicron in March, then-CEO Gary Kelly said in a January earnings call.
While pilots pose the most critical challenge for airlines, some have also struggled to hire people to work at gates and ticket counters, to fuel planes and help load and unload jets, said Henry Harteveldt, travel industry analyst and president of the Atmosphere Research Group.
Filling those roles requires airlines to not only find capable employees, but also workers who can pass sometimes stringent security and drug checks, Harteveldt said. Working in an airport can be stressful, as workers have to deal with unruly passengers and bad behavior. Other industries can lure workers to more lucrative, less stressful roles, he said.
“With the ‘Great Resignation’ taking place and hitting all companies and industries, airlines are certainly not unusual in this,” he said. “But the challenge is that many airline jobs don’t offer you the ability to work from home.”
United’s signing bonus is one attempt to address hiring challenges, though the incentive is unusual in some ways, Harteveldt said.
“These have been jobs that have been traditionally close to minimum wage jobs,” he said. “Not at minimum wage, but certainly not paid a hefty premium. They’ve never been jobs that have had signing bonuses attached to them.”
United is having “small pockets of hiring challenges,” company President Brett Hart said in a January earnings call. Those challenges are not affecting the carrier’s ability to operate, according to Hart, who said he was confident the company would hire enough people in 2022.
“We are taking it market by market,” he said. “And certainly, we are seeing some parts of the country where there is some more difficulty in small pockets we’re hiring, and we’re making necessary adjustments in those markets.”
United is offering the bonus to employees in Chicago, Washington, D.C., San Francisco, Denver and other areas, spokesman David Gonzalez said. In Chicago, the carrier is looking to hire about 200 people just for the department that includes baggage handlers, aircraft marshalers and ramp agents.
A worker shortage is affecting many carriers, though United might be particularly hard hit, said Mike Klemm, president of the union that represents ramp agents, customer service workers, baggage handlers and others at United and other airlines. Until recently, some employees were required to work longer hours to keep up with the airline’s schedules, he said.
He couldn’t pinpoint a reason for a shortage, beyond labor challenges affecting a wide swath of industries. United has a strict vaccine mandate for employees, but he said that didn’t seem to be contributing to the challenges.
“They just can’t get people to come work,” Klemm said.
Southwest Airlines plans to add at least 8,000 people across the company this year, and raised starting wages to be competitive, and because of the effects of the omicron variant and staffing challenges, CEO Bob Jordan said during a January earnings call.
The airline was curbing flights in the first half of the year to “provide additional buffer,” he said.
“We just need to get the staffing levels to the point where we can operate our aircraft, operate them reliably, produce the kind of operational performance that our customers need and want and deserve,” Jordan said. “And it’s just going to take staffing to do that.”
Southwest was among the airlines that experienced staff shortages as the omicron variant picked up steam. About 5,000 Southwest employees got sick during the first three weeks of January, and the carrier canceled 1,600 flights in the first week of that month because it was short-staffed, company President Mike Van de Ven said. More flights were canceled that week because of weather and other reasons.
As the carrier looks to hire thousands of employees, a large portion are intended to be for airport roles, such as customer service, operations and ramp agents, Southwest spokesman Dan Landson said. Southwest did not provide a number for how many people the airline was looking to hire in Chicago, but said Midway and O’Hare airport operations were “a large focus.”
American Airlines is looking to hire 18,000 people this year, on top of 16,000 last year. That includes hiring fleet service and ramp agents at O’Hare, though the airline wasn’t offering incentives to new hires, spokeswoman Gianna Urgo said. Regional airline Envoy, which is owned by American Airlines Group, was also hiring at O’Hare.
American Airlines is among those anticipating a potential shortage of pilots. That airline and other large carriers said they weren’t having trouble finding pilots, but in the short run, smaller, regional airlines could face challenges.
“The imbalance is really going to be played out in the regional carriers,” American Airlines President Robert Isom, who will take over as CEO at the end of March, told investors in January. “And on that front, like other carriers, we’re going to have issues as well. We have them right now. We’re working very hard on that. It’s impacting us to a certain degree, but we’re going to do everything that we can to make sure that it’s not a material impact over time.”
Challenges at regional airlines could be felt sharply in Chicago, too. The majority of flights departing from O’Hare in recent years were operated by regional carriers often on behalf of major airlines, according to data from the Regional Airline Association.
Large airlines have taken long-term steps to try to combat the shortage. United bought a flight school in 2020, now called United Aviate Academy, and is looking to train 5,000 new pilots by 2030, at least half of them women or people of color. American launched a Cadet Academy program in 2018 intended to ultimately provide a pipeline to a job at the airline.
Still any shortage at regional airlines is likely to trickle its way up to the large airlines, said Faye Malarkey Black, president and CEO of the Regional Airline Association. Large airlines recruit pilots from the regional airlines’ ranks, and regionals provide service for them.
“I think, unfortunately, it’s going to get worse no matter what we do,” she said. “Because the gestation period for a pilot is lengthy. You can’t just turn it around overnight.”