Source: Dallas Morning News
Author: Terry Maxon

NEW ORLEANS – Airlines must eventually begin raising wages – even with the cost pressures they face – if they want to attract and retain employees, an aviation consultant said Monday.

Michael Boyd, president of the Boyd Group International, said airlines face the possibility that they won't be able to attract employees, particularly pilots, without reversing the cost pressure to lower pay.

"We have an airline industry that is no longer going to be operating on low wages," Boyd said at his company's annual aviation conference in New Orleans. "We're not going to have that anymore."

He and others warned that regional carriers may be particularly pressured by costs as they deal with two safety-related pushes from the federal government: assuring more rest for pilots and requiring more hours of experience before pilots can fly commercial airlines.

Speaking of a proposal to set 1,500 hours as the minimum flight time for a new regional airline pilot, "that's another $40 million in training: $40 million so you can get a $25,000 a year job and get based in Newark?" Boyd said.

"What we're seeing is that compensation has to go up dramatically through all levels. You've got to attract people, so you're going to have to pay them. And if they're going to have to have that much training and expertise, you're going to have to raise the rates you pay them," he said.

Michael Baida, another aviation consultant who also flies as a United Airlines Inc. captain, said his job has assured a good life for him, particularly now that he's a Boeing 747 pilot.

But Baida said he doesn't know whether he would enter the profession today if he had to make the same decision he made decades ago.

Speaking after the meeting, Allied Pilots Association president Dave Bates said he concurs that the pilot profession must see increased wages.

"We've had dramatic reductions in our earning ability over the last 20 years," said Bates, an American Airlines Inc. pilot. "If airlines want to have pilots to fly their aircraft, they're going to have to correct that situation."

Boyd and William Swelbar, research engineer at the Massachusetts Institute of Technology, said the increased employee costs will have a negative impact on air service to smaller cities.

"It seems as we start to see costs push on the regional side particularly ... there are going to be markets that are just uneconomic to serve going forward," Swelbar said.

He said the U.S. needs to re-examine how it hands out funding for the 450 U.S. airports that have commercial air service. Of that group, 200 handle 97 percent of the domestic traffic. The remaining 250 account for only 3 percent, he said.

The nation may need to make tough decisions to focus on serving regions rather than particular cities, Swelbar and Boyd said.

Boyd, while criticizing the federal "essential air services" program that subsidizes service to many small communities, said it is vital to areas such as western Kansas, the Upper Peninsula of Michigan, and Montana, where there are no busy airports that otherwise would attract profitable service.