Philippine Airlines plans to slash workforce by more than a third after COVID hit

REUTERS/Romeo Ranoco

Philippine Airlines on Thursday kicked off a major job-cutting program that could slash its workforce by more than a third, employees briefed on the matter told Nikkei Asia.

The drastic move reflects the deepening impact of the coronavirus pandemic and related travel restrictions on airlines across Asia.

In the first phase of the program the airline will seek voluntary resignations, while the second stage will involve compulsory terminations, airline officials told staff during virtual townhall meetings on Thursday. The program is expected to run through early December.

Philippine Airlines and its budget affiliate employ around 7,800 workers. Staff were informed in early September that the airline was considering a 21% to 38% reduction of its workforce.

The company is aiming to cut around 35% of jobs across all departments, according to the employees who spoke on condition of anonymity as well as materials from the meetings seen by Nikkei. A Philippine Airlines spokesperson was not immediately available for comment.

Airline officials stressed during the townhall meetings that the program was necessary for the company’s survival and that it might take a few years for business to recover.

PAL Holdings, the airline’s listed parent which is partly owned by Japan’s ANA Holdings, reported 20.7 billion pesos ($427 million) in losses in the first half, from a 3 billion peso loss in the same period last year, as revenues plunged 54.7% to 36.8 billion pesos. In the April-June quarter — which covered the most intense period of lockdown in the Philippines —revenues fell 88.8% to 4.7 billion pesos.

Billionaire Lucio Tan, who controls the airline, had been forced to infuse billions of pesos in additional capital to keep it afloat, according to a stock exchange filing.

Philippine Airlines cut around 300 jobs in February. Cebu Air, a Philippine budget carrier, has also laid off 800 staff amid continuing travel restrictions due to the coronavirus pandemic.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.