The biggest airport in Canada is eliminating 500 jobs because of the dramatic reduction in demand for air travel due to COVID-19.
The Greater Toronto Airports Authority, which operates Pearson International Airport, says it will not fill 200 current open positions and get rid of an additional 300 positions through voluntary departures and layoffs.
The cuts represent a slash of 27 per cent of the airport operator’s pre-pandemic workforce.
In April, Pearson airport processed 97 per cent fewer passengers than it did in the same month a year earlier and right now the GTAA says passenger traffic is back where it was in 1996.
Isabelle Dostaler, the dean of business at Memorial University in St. John’s, says the news is not surprising.
“Anyone in this air transportation system is being affected right now,” she said in an interview.
She said smaller regional airports like her local one in St. John’s have been hit perhaps even harder than big hubs such as Pearson.
“It’s now empty,” she said, speaking of the arrivals hall of St. John’s airport. “You look at the screen, and normally the screen is full announcing flights coming in and going out; there’s just three or four lines now.”
But even an airport as busy as Pearson can’t maintain current staffing levels forever in the face of cratering demand.
“It’s all across the system,” she said.
50 million passengers last year
The staffing move comes after the GTAA already deferred $265 million in planned capital spending this year, including temporary cuts to salaries for the company’s management and board of directors.
Two of the job cuts will come from the ranks of the GTAA’s executive team, with the departure of its vice-president and chief strategy officer, Kim Stangeby, along with vice-president of customer and terminal services Scott Collier.
“Our leadership team and board of directors have worked concertedly each month to navigate these turbulent times and have put our people first,” CEO Deborah Flint said in a release. “This reduction in force is a difficult but necessary step, and one that we take with great sadness.”
The airport operator says it will work with the Unifor union and Pearson Airport’s firefighter association to implement the changes while respecting their labour contracts.
Full recovery may take 5 years
Last year, Pearson moved 50 million passengers, but this year the GTAA says the airport is experiencing “significant declines in passengers and flight activity as a result of travel advisories and restrictions by governments, flight and route cancellations, and fleet groundings by air carriers.”
The GTAA says normal flight activity “may not return to pre-COVID-19 levels for at least three to five years, according to certain industry participants.”
Business professor Ken Wong at Queen’s University in Kingston, Ont., says the layoffs are to be expected during the current situation, but he’s concerned about what might happen if the layoffs become more permanent.
“While the current cutbacks are easily understood given the state of demand they face and the uncertainty of how the pandemic will unfold, eventually conditions will show improvement,” he said.
“Historically, during recessions, rehiring staff is the last thing done. Employers are waiting for more certainty since the cost of onboarding can only be justified if the employment is for a long duration.”