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United Airlines (UAL) Spares Flight Attendants From Furloughs

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Per a CNBC report, United Airlines Holdings (UAL - Free Report) has informed thousands of employees that they will not be furloughed in October, once the third round of payroll support expires. This is unlike what the company announced after the first two rounds of government aid, protecting airline jobs, expired.

The airline attributed its decision to the continued recovery in air-travel demand, particularly on the leisure front, as Americans get vaccinated and resume flying. The reopening of several countries to vaccinated travelers provides a further boost to passenger demand.

U.S. airlines received $54 billion in federal aid amid coronavirus-led suppressed travel demand, with a condition to not lay off workers. Just months back, when the second payroll aid was about to expire in March, United Airlines gave a heads up about possible furloughs. In fact, the carrier had laid off thousands of employees last October once the first round of federal assistance ran out. However, they were later called back when the U.S. government approved the second coronavirus relief package.


Per the CNBC report, John Slater, senior vice president of United Airlines’ inflight services, wrote to the carrier’s approximately 23,000 flight attendants, “Given the increase in customer demand and our current outlook for the future, we’re excited to announce that we will not need to furlough flight attendants assigned to active, open Inflight bases again this fall when the current Payroll Support Program (PSP) funding ends on October 1.”

Similar memos, reviewed by CNBC, were received by airport operations workers and customer service agents on Friday, saying that the company “will not furlough” them following the expiration of the third round of aid in September 2021.

With travel demand continually improving, last month, United Airlines announced plans to add more than 400 daily flights to its July schedule. The airline expects to operate 80% of its pre-pandemic U.S. schedule in the month as summer travel bookings rise 214% compared with the 2020 level.

Zacks Rank & Key Picks

United Airlines carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Transportation sector are C.H. Robinson Worldwide (CHRW - Free Report) , Expeditors International of Washington (EXPD - Free Report) and Covenant Logistics Group (CVLG - Free Report) . While Expeditors and Covenant Logistics sport a Zacks Rank #1 (Strong Buy), C.H. Robinson carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of C.H. Robinson, Expeditors and Covenant Logistics have rallied more than 27%, 69% and 79% in a year’s time, respectively.

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