Singapore Airlines cuts capacity by 10%, freezes hiring as virus takes toll

Singapore Airlines temporarily suspended more than 3,000 flights from February to end-May, accounting for 9.9 percent of the group’s scheduled capacity. (AFP)
Short Url
Updated 25 February 2020

Singapore Airlines cuts capacity by 10%, freezes hiring as virus takes toll

  • The carrier has temporarily suspended more than 3,000 flights from February to end-May
  • Travel demand has been hit due to the virus and also as governments imposed curbs on movement to contain the epidemic

SINGAPORE: Singapore Airlines has cut nearly 10 percent of its capacity, frozen recruitment for ground positions and deferred spending as it deals with lower demand due to the coronavirus outbreak, according to an internal memo seen by Reuters.
The carrier has temporarily suspended more than 3,000 flights from February to end-May, accounting for 9.9 percent of the group’s scheduled capacity, said the memo sent to staff.
“We will continue to be nimble and flexible in adjusting our capacity to match the changing demand patterns in the market,” Chief Executive Goh Choon Phong said in the memo, first reported by the Straits Times newspaper.
“We have also proactively reached out to our suppliers and partners to discuss additional mitigating measures during this difficult time,” he said.
The coronavirus, which originated in China last year, can be transmitted from person to person and has killed more than 2,500 people and infected over 80,000 people, mostly on the mainland.
Travel demand has been hit due to the virus and also as governments imposed curbs on movement to contain the epidemic, forcing airlines to cancel thousands of flights.
Singapore Airlines, earlier this month, said it would cut capacity across its network in the three months to May including destinations like Frankfurt, Jakarta, London, Los Angeles, Mumbai, Paris, Seoul, Sydney and Tokyo.
It did not provide details on what percentage of capacity would be cut at the time.
On Tuesday, Singapore Airlines said its CEO had sent a memo to staff, without detailing the contents.
It said it was closely monitoring the situation and would take any additional measures needed, but would not do anything to harm its long-term competitiveness.
Hong Kong-based rival Cathay Pacific Airways Ltd. has cut 40 percent of capacity across its network due to the fall in demand associated with the epidemic and asked all its employees to take three weeks of unpaid leave.


European jobless rate up modestly, Germany mulls stimulus

Updated 04 June 2020

European jobless rate up modestly, Germany mulls stimulus

  • Europe’s rise in unemployment has been moderate by international standards

BERLIN: Europe’s unemployment rate ticked up modestly last month, contained by use of labor programs that have kept millions of workers on payrolls, official data showed Wednesday.

The jobless rate in the 19 countries that use the euro rose to 7.3 percent in April, the first full month when pandemic lockdowns hit the continent, from 7.1 percent in March, statistics agency Eurostat said Wednesday.

Europe’s rise in unemployment has been moderate by international standards because employers are making extensive use of government-backed short-time work programs that allows them to keep employees on the payroll while they await better times.

In Germany, Europe’s largest economy, the federal labor agency pays at least 60 percent of the salary of employees who are on reduced or zero hours. Some 10.66 million people were registered for that program in March and April, and 1.06 million followed in May, the labor agency said — though it stressed that this doesn’t mean all of them were put on short-time work. Germany has a population of 83 million.

In the US, which has fewer automatic furlough schemes than Europe, the jobless rate has rocketed to almost 15 percent from 4 percent before the crisis.

The European jobless figures, however, also appear flattered by the fact that some unemployed people likely stopped looking for work and stopped counting as jobseekers.

On Wednesday, Chancellor Angela Merkel’s coalition was spending a second day hammering out a stimulus package meant to help kick-start the economy. It’s expected to be worth as much as €80-€100 billion ($89-112 billion).

Germany started loosening coronavirus restrictions on April 20, about a month after they were introduced, and the easing has gathered pace since. However, the economy went into a recession in the first quarter and that is expected to deepen in the current quarter.