EU airlines face strikes and struggle to locate workers after Covid summer travel

Some airlines and airports are struggling with post-Corona travel demand.

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LONDON – Delays, cancellations and strikes. It’s been a chaotic time for many European tourist hotspots as airlines and airports struggle to cope with pent-up travel demand following the Covid-19 lockdown.

Thousands of flights have been canceled and travelers have been queuing for hours at passport control and baggage claim at airports across Europe lately – and the problems are expected to drag on.

“Air travel this summer is fraught with uncertainty for both passengers and airlines,” Laura Hoy, an equity analyst at Hargreaves Lansdown, told CNBC via email.

“Long delays and cancellations are likely to hurt consumers’ desire to travel, as airlines walk a fine line between attempting to catch the post-pandemic travel boom and preparing for the likely slowdown that looms as economic conditions worsen , walk.”

According to aeronautical data company Cirium, 400 flights were canceled at all UK airports between 24 and 30 June, a 158% increase over the same seven days in 2019.

And that outside of the main summer season – in Europe usually between July and the beginning of September.

London’s busiest airport, Heathrow, last week urged airlines to cut flights as passenger numbers exceeded what it could handle. Some passengers were unaware that their flight had been cancelled, while others complained about the long queues.

There will be interruptions well into the summer.

Stephen Furlong

Stephen Furlong, senior industry analyst at Davy

Meanwhile, budget airline easyJet has canceled thousands of flights over the summer to minimize the risk of disruption.

Travelers also faced similar problems in the US when they tried to travel over the July 4th weekend, with more than 12,000 flights delayed and hundreds canceled.

And the travel chaos is unlikely to ease in the coming months, according to Stephen Furlong, senior industry analyst at wealth manager Davy.

“There will be disruptions well into the summer, whether ATC [cargo] driven or ground handling or security personnel or even airline labor problems of their own making,” he added.

In France, a quarter of flights at the main airport in Paris were canceled in June due to a workers’ strike.

And more strike-induced unrest could be on the way. British Airways is preparing for a staff strike in the coming weeks as workers demand a 10% pay cut introduced during the pandemic be reversed. And Ryanair workers in Spain said over the weekend they would go on strike for 12 days in July urging better working conditions.

What is causing the disruption?

There are multiple reasons for the travel chaos, and they are mostly industry-wide issues rather than a country or airline specific issue.

“The pace at which passengers have returned to the skies since spring has surprised airlines and airports a bit. European transport analyst at AB Bernstein, told CNBC’s Squawk Box Europe last week.

Many airlines, airport operators and other travel industry companies laid off workers during the pandemic as their businesses ground to a halt. Many of these workers sought opportunities elsewhere and have not returned to the sector, while others have been pushed into early retirement.

“Ultimately, we need more staff,” Irving said.

Additionally, with changes in the labor market, such as the so-called Great Layoff, it is currently difficult to attract new talent – ​​when workers chose to quit their job, often without anyone else queuing, in search of a better work-life balance.

Hiring new staff is also a medium to long-term solution, as many travel-related jobs require training before workers can start work.

At the same time, many of those who stayed in the industry do not feel adequately compensated and have complained about their working conditions.

It “probably ultimately means paying people more and treating them a little better,” Irving said of the labor problems and strikes.

At Amsterdam’s Schiphol Airport, a group of cleaners, baggage handlers and security guards will be paid an additional €5.25 ($5.55) an hour this summer, according to Reuters. However, the same airport announced that it would limit its passenger traffic this summer, in particular to reduce disruption.

Other countries are also trying to improve the situation at their airports. In Spain, police are hiring more staff at some of the country’s busiest airports, and Portugal is also beefing up its border control staff.

“The response of most companies to the outbreak of the pandemic has been to scale back capacity in anticipation of a sustained period of slower growth. However, the pandemic produced a different outcome: one where the global economy virtually shut down and then turned back on within a short period of time,” Roger Jones, head of equities at London & Capital, told CNBC.

He said that alongside the lack of jobs, inflation is also an issue.

“Cost inflation, particularly in fuel and wages, is making things worse and making it a really tough operating environment that’s weighing on profitability,” he said via email.

Many airlines, including British Airways and Air France-KLM, received financial support from governments during the pandemic to avoid collapsing. However, a number of unions and airlines are now demanding more help from governments to help revitalize the sector.

Despite the strikes, cancellations and other disruptions, some analysts are still bullish on the sector, arguing that the recent situation has been “exaggerated”.

“I feel like it’s being overdone by the media and the vast majority of flights are operating and on time. Ryanair, for example, has planned to do this despite operating 115% of pre-Covid capacity and has largely avoided disruption so far,” Davy Furlong said via email.