American Airlines to cut 19,000 jobs when federal aid runs out in October

The announcement comes a month after airline issued layoff notices for 25,000 employees

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American Airlines announced it will cut 19,000 employees in October once its federal aid expires.

The company was a recipient of government emergency funding meant to prevent mass layoffs resulting from business shutdowns associated with the coronavirus.

"We have come to you many times throughout the pandemic, often with sobering updates on a world none of us could have imagined," American Airlines' CEO Doug Parker and its president Robert Isom wrote in a staff statement announcing the cuts. "Today is the hardest message we have had to share so far -- the announcement of involuntary staffing reductions effective Oct. 1."

American Airlines employs more than 140,000 people.

The announcement comes a month after the company issued WARN notices alerting 25,000 of its employees to possible layoffs.

The airline industry has been hit especially hard by the pandemic. The number of air travellers this year is half of what it was during this same period last year.

Company executives said the only hope for avoiding the layoffs was an extension of federal funding.

"The one possibility of avoiding these involuntary reductions on Oct. 1 is a clean extension" one of the executives said Tuesday, according to CNBC.

Negotiations between Democrats and Republicans in Congress to potentially extend the funding broke down last week.

"PPP is about to expire, and Congress is not prepared to provide any additional help to small businesses on the brink of collapse," John Arensmeyer, founder and CEO of Small Business Majority, a small business advocacy group, told USA Today. "There are a number of small businesses in our network that cannot survive even one more month at the current rate of business without more help."

American Airlines has tried to mitigate job losses during the pandemic by asking employees to take buyouts, encouraging early retirement and unpaid or partially paid leaves.

More than 12,500 people have left American Airlines permanently, while 11,000 are set to go on leave beginning in October.

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