U.S. lawmakers consider aid for aerospace workers in COVID-19 bill

FILE PHOTO:  Signage is seen outside of an International Association of Machinists and Aerospace Workers labor union in Brooklyn, New York City
FILE PHOTO: Signage is seen outside of an International Association of Machinists and Aerospace Workers labor union in Brooklyn, New York City, U.S., September 14, 2020. REUTERS/Andrew Kelly/File Photo

December 18, 2020

By David Shepardson and Eric M. Johnson

WASHINGTON/SEATTLE (Reuters) – U.S. lawmakers are considering providing payroll assistance for aerospace manufacturers and suppliers as part of a massive $900 billion COVID-19 relief bill, congressional aides told Reuters.

In a letter to congressional leaders Thursday seen by Reuters, 11 senators proposed “the federal government would pay up to 50% of the payroll costs for up to 25% of a manufacturer’s workforce” for aerospace manufacturers and suppliers.

The U.S. aviation industry has lost 100,000 jobs and a third of the global airline fleet remains grounded since the outbreak, the senators said, adding “an additional 220,000 jobs are at risk.”

The measure is backed by senators from states hard hit by the decline in aerospace employment, including Kansas’s Jerry Moran and Pat Roberts and Washington State’s Maria Cantwell and Patty Murray.

International Association of Machinists and Aerospace Workers (IAM) President Robert Martinez urged senators to back the effort to provide payroll assistance “for those aerospace industry workers most at risk of layoff or furlough due to the pandemic.”

Martinez and Aerospace Industries Association CEO Eric Fanning in a joint op-ed Wednesday said without swift action by lawmakers the United States risks “losing these employees to other less-impacted industries that might seek their talents.”

In October, Boeing Co told employees it expects to eliminate 30,000 jobs to reach a workforce of around 130,000 worldwide by end-2021 – 11,000 more than previously discussed.

Spirit AeroSystems and General Electric Co’s aviation units have both cut thousands of jobs this year.

The senators said the “program is estimated to cost $3.8 billion over four months, but save an estimated $3.5 billion in unemployment costs borne by the states and federal government if these employees were instead to be furloughed.”

Two congressional aides briefed on the matter said a proposed $17 billion payroll support program for U.S. passenger airlines in the $900 billion measure could fall to $14 billion, as lawmakers may shift some funds to aerospace workers and airport contractors.

Of $45 billion designated for transportation in the bill, $16 billion has now been reserved for aviation. Some congressional aides think the final bill could designate $1 billion for aerospace workers and $1 billion for airport contractors, but negotiations continue.

It is not clear what any final aerospace assistance program adopted by Congress might look like.

U.S. airlines will be required to offer more than 32,000 workers furloughed in October their jobs back and keep them on payrolls through March 31 as a condition of assistance.

(Reporting by David Shepardson in Washington and Eric M. Johnson in Seattle; Additional reporting by Tracy Rucinski; Editing by Kenneth Maxwell)