The leading airport baggage and ticket handler Swissport will lay off more than 4,500 staff, weeks after it warned Britain’s travel quarantine and cuts to furlough grants made job cuts inevitable.
The company announced on Wednesday it will let go of 53% of its UK workforce, with its revenue collapsing in recent months and air travel not expected to return to pre-virus levels for several years. It has workers at airports across the UK, and is reported to be Britain’s biggest airport ground handling company.
“The unfortunate fact is that there simply aren’t enough aircraft flying for our business to continue running as it did before the COVID-19 outbreak, and there won’t be again for some time to come. We must adapt to this new reality,” said its CEO for Western Europe Jason Holt in a memo to staff shared with Yahoo Finance UK.
He said the company’s revenue had been “almost completely lost” during the pandemic so far, with income down 75% in May. Holt told staff in the memo the cuts were necessary to survive and secure a “lifeline of funding” from lenders and investors.
Union leaders called the announcement “devastating,” and echoed airlines’ repeated calls for a UK government bailout for the struggling aviation sector.
“At least 4,000 workers — and possibly many more — will lose jobs which are essential to regional economies,” said Nadine Houghton, GMB national officer.
Oliver Richardson, Unite’s national officer, called for the government to urgently intervene with a “bespoke financial package and an extension of the 80% furlough scheme for the aviation industry.”
It comes after the company warned in a statement in May over the impact of cuts to furlough grants and a controversial 14-day quarantine rule on new arrivals.
The government is gradually cutting subsidies to employers with staff on furlough, sparking widespread predictions of job losses as some firms struggle to cover increased wage bills.
“Without moving quickly to put ‘air bridges’ in place or review the quarantine policy, we’re not going to see a return in demand for many months,” said a Swissport spokesperson last month.
“Without this corresponding recovery in demand it’s simply not possible for our industry to move to the proposed next phase of the job retention without significant job losses.”
Airlines including British Airways and Ryanair have announced thousands of job cuts, while plane engine maker Rolls-Royce also plans mass redundancies.