A growing pilot shortage at regional airlines could soon pose a major headache for airline passengers across the U.S.
“It’s a crisis that is exploding right now,” said Dan Akins, a transportation economist who two years ago co-founded the consulting firm Flightpath Economics in anticipation of the pilot shortage. “It’s not going to get better. It’s going to get worse. It’s almost a contagion.”
Republic Airways, which operates Delta Connection, United Express and American Eagle flights, has experienced monthly cancellation rates as high as 9%, prompting Delta to accuse the company in an October lawsuit of not providing promised services. And although much of Republic’s problems were driven by a protracted contract dispute with its pilots, which was resolved in October, the carrier isn’t alone in having concerns about having enough pilots to staff current operations.
Also in October, citing pilot shortages, regional provider Seaport Airlines reduced the number of direct routes it flies from its Memphis hub from more than 10 to just three and ended the only commercial service in Tupelo, Miss., and Muscle Shoals, Ala.
Meanwhile, while regional stalwart SkyWest, which like Republic partners with American and Delta and United, has been able to avoid major issues with cancellations, it did cut capacity 5.7% between November 2014 and last November.
During the company’s third-quarter earnings conference, SkyWest President Chip Childs acknowledged that the carrier is “not immune” to pilot shortages and, according to a transcript of the meeting posted by the website Seeking Alpha, noted that the key for the airline is to manage the dilemma, “from the very, very beginning.”
Despite the cessation of some routes, together with high cancellation rates at Republic and some smaller regional carriers, the pilot shortage has yet to have enough of an impact on the flying public to generate widespread awareness of the problem.
That could be about to change.
Since 2011, the number of city pairs flown by U.S. regional aircraft has dropped by more than 12%, according to Bill Swelbar, who has analyzed the pilot shortage as a vice president of the Washington-based airline and airport industry consulting company InverVistas Consulting. But both he and Akins expect 2016 and 2017 to be a tipping point. And the problem, they say, will get worse quickly.
Driving their forecasts are the twin dynamic of a rash of upcoming retirements at American, Delta, Southwest and United coupled with a dearth of candidates working their way through flight-training academies.
In a report about the pilot shortage released last year, Flightpath Economics projected that between 2014 and 2022, 18,000 pilots will retire from the Big Four carriers. That’s as many pilots as staff the entire regional U.S. network, which also serves as the predominant recruiting network for the mainline carriers.
Swelbar’s estimates are similar, and the number of retirements, he said, will actually escalate year after year, jumping from just under the estimated 1,100 in 2015 to more than 1,200 this year and to nearly 2,500 in 2022.
As mainline pilots retire, many will be replaced by pilots who today are flying for regional carriers. Those pilots, in turn, must be replaced by pilots coming out of flight-training schools. In addition, pilots must be added to the system to account for growth at not only the Big Four airlines but also at the rapidly expanding network of low-cost carriers, such as Spirit and Frontier.
According to Akins, there just aren’t enough people in the flight-training pipeline to keep up.
“We don’t have enough capacity in this country to train enough pilots to meet the demand,” he said.
A main cause of that problem, say many in the industry, is a congressionally mandated rule that took effect in 2013 that increased the minimum hours a pilot must have in the cockpit in order to fly for a commercial airline from 250 to 1,500.
The six-fold increase went into effect even as wages at regional airlines remained relatively low. Under the deal that Republic reached with it pilots’ union in October, new pilots will get $40 per flight hour. But that’s industry-leading and some 33% more than the starting rates at SkyWest.
With wages at the Republic level, the economics of putting in the 1,500 hours of training time just don’t add up, Akins said.
Furthermore, those who do graduate from U.S. flight academies often have the option of chasing far bigger dollars, sometime well into six figures, on foreign carriers, and they can do so without obtaining anywhere near 1,500 hours of flight time, said Swelbar, who cited as an example the growing Middle East airlines, such as Emirates.
The Regional Airline Association, which counts Sky West’s and Republic’s various brands among its 26 members, declined to be interviewed for this story. It did, however, release a statement in early December about a program called ACE, short for the Air Carrier Enhanced Pilot Training Program, that it hopes to establish. The statement said it would offer an alternative, streamlined path to a commercial pilot’s license that takes advantage of flight-time credit hours already allowed by Congress for specialized training programs.
Other airline industry players were also loath to discuss pilot shortages at regional airlines. SkyWest declined such an interview, and Republic did not respond to an interview request.
United declined to discuss the shortage in an interview but in a brief email stated, “We continue to work with our United Express partners to minimize any possible inconvenience this may cause our customers.”
Airlines for America, which represents mainline U.S. airlines, including American, Southwest and United, said that it was not concerned about the regional airline pilot shortage.
“We expect the major commercial airlines will remain appropriately staffed and are not expecting any shortage,” spokesman Vaughn Jones said.
Swelbar said he expected that one way or another the major carriers will adapt to the shortage, even if it means a drop in regional routes.
“When you think about it, if they’re going to be forced to fly a smaller network, they’ll figure out how to do it, and they’ll do it profitably,” he said.
But a contraction of regional flight service would have a major impact on many midsize and smaller U.S. communities, especially since regional flights account for nearly 40% of all domestic commercial flights in the U.S., according to Flightpath Economics.
“Carriers are going to have to decide” Akins said. “We can only support 80% of the regional services that we need, so how do we handle this?”