(The Center Square) – One of the hardest-hit sectors of the economy during the COVID-19 pandemic has been the airline industry and a full recovery may be years away.
Illinois-based United Airlines announced that it may have to lay off over 30,000 workers, including one-third of its pilots by October. The news comes after United CEO Scott Kirby said the airline expects the recovery in air travel to plateau at around half of 2019 levels until there is a vaccine for the coronavirus.
The recent surge in U.S. COVID-19 cases has a trade association for the airline industry moving back its forecast for a recovery. The International Air Transport Association predicts that air travel won’t return to normal until at least 2024. IATA chief economist Brian Pierce said vacation travel is being hurt by the economy and high unemployment numbers.
“One of the critical drivers of leisure travel is the confidence of consumers, and although we can see some improvement, consumers are much less confident,” Pierce said. “The industry is seeing a rebound from the depths of the shutdowns in April, but the bad news is that any increase is barely visible.”
Gene Olson, director of Peoria International Airport, said the airline industry won’t return until a key sector of customers returns.
“For things to really come back to normal, you are going to need a resumption of business travel, and I don’t see that happening until there is a vaccine or a very good therapeutic treatment,” Olson said.
With people working from home and conventions being canceled because of public gathering limits, business travel has come to a halt. McCormick Place, which hasn’t hosted an event since February, has an enormous economic impact and draws travelers to Illinois from all over the world. Trade show losses at the facility during the pandemic reportedly have cost nearly $1.7 billion.
“To put things in perspective, we set a record for passenger count in January and set another record in February with 52,000 passengers,” Olson said. “Then the bottom kind of fell out. In April, we had 2,928.”