Spotlight on Industry Headlines
AMERICANS START TRAVELING AGAIN S everal U.S. airlines have recently resumed hiring pilots or plan to this year, the latest sign the industry expects travel demand to continue rising. Before the Covid pandemic hit, airlines were preparing for a wave of pilot retirements, which are federally mandated when pilots reach age 65. But last year’s plunge in travel forced most airlines to cut labor costs, which included offering early retirement pack- ages to pilots. Now as travel demand returns, airlines are shifting their focus back toward hiring again. Pilot training can be time-consuming and costly. So, airlines usually plan years in advance, generally so they can have enough pilots to handle peak summer travel sea- sons ahead. T he federal government navigates a $5.9-billion bail out package for Air Canada that comes with several strings attached for Canada’s largest airline through Ottawa’s Large Employer Emergency Financing Facility (LEEFF) pro- gram. In return, Air Canada agreed to several commitments including refunding tickets, resuming regional routes, pro- tecting jobs and keeping its aircraft orders. After nearly a year of subdued activity, the Canadian airline industry is showing signs of life. Some analysts had criticized the government for imposing excessive curbs on the airlines without any major financial support for the industry that led to job losses. The industry also shares some of the blame for not saving for a rainy day. AIR CANADA LANDS GOVERNMENT BAILOUT PACKAGE
CANADA’S ECONOMY GAINING MORE JOBS THAN EXPECTED That aligns with Statistics Canada’s latest inflation readings. The agency reported that its “adjusted” Consumer Price Index rose one and half percent in February from a year earlier, faster than the official CPI, but still well below the Bank of Canada’s target of two percent. I nflation may still be a theoretical concern, but not a real one, as Canada’s latest housing mania and surging commodity prices haven’t dislodged expectations that the central bank will keep prices under control. According to a Canadian Chamber of Commerce survey of 15,400 employers in January and February, only fourteen percent of companies planned to raise prices over the next three months, despite rampant anecdotal evidence of rising costs for inputs such as lumber, shipping containers and even pallets. CANADA NOT RAISING RATES ANYTIME SOON C anada’s jobs market grew for a second straight month, one more sign the nation’s economy is on the cusp of fully re- covering from the pandemic. According to Statistics Canada in Ottawa the economy added 303,100 jobs in March. That’s triple what economists were antici- pating and follows a gain of 259,200 in February. The two-month jump was led by a rebound in a retail sector hit hardest by closures over the winter. The country has now recovered all but 296,000 of the nearly 3 million jobs lost during the pandemic. For months, the data have shown an economy gaining strength, surprising even the most optimistic analysts. That resilience is fu- elling expectations for a strong rebound in 2021 after the econ- omy suffered its sharpest downturn in the post-World War II era last year.
APRIL 2021 • SPOTLIGHT ON BUSINESS MAGAZINE
SPOTLIGHT ON BUSINESS MAGAZINE • APRIL 2021
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