With travel demand still well below prepandemic levels, the airline industry has requested a second round of federal bailout funds. Should legislative aid fail to materialize, American, United and Alaska airlines are planning massive layoffs beginning Oct. 1—but their marketing and advertising departments won’t be affected.
After being given nearly $25 billion in April as part of a $2 trillion bailout, the airline industry was prohibited from laying off employees until after September, despite millions in revenue losses. Essentially, the airlines are staffed at pre-pandemic levels even though demand has disappeared. According to the TSA, airport traffic on Labor Day was off more than 60% from 2019. And what flying is happening remains almost entirely domestic, as Americans are still restricted from traveling nearly anywhere beyond Mexico and the Caribbean due to Covid-19 concerns.
To cut costs in the meantime, airlines have resorted to offering early retirement and voluntary buyouts, which helped avoid some staff cuts. A majority of the layoffs expected to take place next week will consist of frontline workers including pilots, flight attendants and mechanics. So far, American has said it’ll lay off or involuntarily furlough 19,000 employees unless there is federal help. United Airlines has announced plans to eliminate 16,000 jobs. Alaska is expected to cut 4,000 jobs.
But marketers still with the airlines will emerge unscathed, in part because many opted for those early buyouts.
“We are not expecting any further cuts,” said Janelle Anderson, vp of global marketing at American Airlines, speaking specifically of her team.
United Airlines’ marketing, advertising and social teams had enough employees accept voluntary buyouts that they won’t face layoffs, one source told Adweek, speaking on background because of the sensitive discussions.
Neither will Alaska, which completed a companywide reorganization and restructuring in February. In fact, a redeployment exercise kept marketing staff contributing to more pressing concerns when travel demand essentially disappeared at the outset of the pandemic.
“I had people on our marketing team spend 50% of their time in revenue and accounting, and 50% supporting our cargo operation,” said Natalie Bowman, managing director of marketing and advertising at Alaska Airlines. “It was a really smart way to take smart, talented people and make sure they’re still able to stay busy. Once things on the marketing side started ramping back up, they came back full time.”
Southwest Airlines, which has continued to outspend its competitors on advertising during the pandemic, has publicly stated that it won’t have any layoffs.
Last week, Delta CEO Ed Bastian announced that the airline was avoiding involuntary furloughs for frontline workers and flight attendants, but that pilots would still see cuts. A Delta spokesperson declined to comment to Adweek about possible changes to its marketing department, but said that “avoiding involuntary furloughs of any kind continues to be our focus.”
The airline has already seen at least 40,000 employees take short- and long-term unpaid leaves of absence.
Even though White House chief of staff Mark Meadows said the administration was looking to ease the industry’s hardship—a sentiment shared by the president—those options were “less than ideal,” he told reporters, and that it was incumbent upon Congress to act.
JetBlue declined to comment on how its marketing department would be affected after Sept. 30. In a filing this morning, the airline disclosed that capacity for Q3 will decrease about 55% year over year, instead of the previously forecast decline of 45%. Still, JetBlue saw a “modest improvement” in booking trends driven by leisure demand.