Friday, December 11, 2020

Who will pay for the crisis? Lufthansa receives $10 billion state bailout and cuts 30,000 jobs

On November 14th we were writing that at least 90,000 people will lose their job by the end of December as a result of mass layoffs by major U.S. airline companies. Aviation giants, such as United Airlines and American Airlines laid off 32,000 workers last October in an attempt to blackmail the U.S. government for higher subsidies.

The COVID-19 pandemic had a serious impact on the aviation industry due to travel restrictions and a significant slump in demand among travellers. No travellers means less profits for the big airliners. In order to reduce losses, the monopolies of aviation proceed to a series of anti-labor measures, including pay cuts, furloughs and, of course, layoffs. 
But even when they receive generous state subsidies (money from the tax-payers's pockets) they do not guarantee employment positions; on the contrary, they proceed to more job cuts! A characteristic recent example is the case of the German airliner Lufthansa.

According to reports, the company will have shed almost 30,000 staff by the end of the year and will cut another 10,000 jobs next year. As Bild am Sonntag newspaper wrote, Lufthansa would cut 20,000 jobs outside of Germany, while it is also selling its catering unit LSG which employs 7,500 people!

The layoffs will take place despite the fact that the airliner received a 9-billion-euro ($9.9 billion) government bailout earlier this year and has already burned through 3 billion euros! The major accomplice in the company's decision of the company to cut jobs is the Ver.di. trade union (Vereinte Dienstleistungsgewerkschaft), which is a member of the SPD-controlled German Trade Union Confederation (DGB). In November, Ver.di. and Lufthansa signed an agreement which was allegedly approved by 71% of the union's members.

Lufthansa's Human Resources Director Michael Niggermann hailed the agreement calling it a major contribution for the “safeguarding of the future and employment” and made clear that he expected even more sacrifices from the employees!

Lufthansa is not the only German airliner who has received state aid in order to deal with the current crisis; Condor and TUIfly have also received bailout. All these companies, which operate on the basis of maximum profit-making, are trying to improve their position in the international aviation market at the expense of the workers. 

The pandemic has been proved a great opportunity for the big capital.