A very real pilot shortage threatens to upend the U.S. airline recovery

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• Even as the recovery progresses, airlines continue to reshuffle available pilots to staff the needed capacity around the world, creating a near-term shortage and operational challenges.
• The United States airlines are set to experience further challenges, with more pilots needed to backfill those lost in 2020 in 2020, and face a structurally broken supply chain to conduct their operations.
• The U.S. regional airlines are particularly exposed, backfilling more pilots into the majors than can be replaced threatening the pace of the recovery.
  

Nearly two years into the pandemic, the world continues to slowly reopen. The next large travel restriction set to fall will come on November 8, 2021, when vaccinated non-U.S. citizens can once again travel to the United States — a major milestone in the return to normal global travel.

Yet, arriving with the latest round of good news, clouds of uncertainty continue to hang over the industry, even with this step toward normalcy. Aviation has been conditioned to temper signs of good news with the possibility of what may be lurking to threaten progress. What makes this step different, however, is a new source of uncertainty — supply shortages.

From computer chips to rental cars, toilet paper to restaurant staff, the idea of supply shortages in the form of people and products has entered the daily vocabulary of the world’s population. As air travel continues to recover, aviation is also expected to be subject to similar shortages, shifting the conversation from one of demand, to one of supply.

Related: Furloughs, aircraft retirements put a ceiling on airline recovery

Chief among the concerns for air travel’s recovery is the supply of pilots. Already strained leading into 2020, the arrival of the pandemic triggered the exit of large numbers of pilots from seniority lists, many accepting packages to permanently retire as they neared age limits. Last year, we concluded that absent a continuation of government support U.S. aviation could not return to pre-pandemic levels of traffic and capacity without a pilot workforce of equivalent size.

In this TAC Analysis, we revisit the potential re-arrival of a pilot shortage, and how it may quickly become the limiting factor in the recovery. Crucially, while regional airlines were a welcome source of strength during the COVID pandemic, the lack of pilots in the United States could quickly turn the strongest regional jet market on its head.

At play are both the near-term effects of staffing flight decks affecting the world, as well as the long-term challenges unique to the United States — where pilot supply issues have already exposed an acute operational strain on the system.

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