PSA Airlines, a wholly owned subsidiary of American Airlines (NASDAQ: AAL), announced Friday that it would give its pilots a 50 percent pay raise through August 2024, becoming the last of American’s regional partners to announce temporary pilot pay upgrades.
Announcing the deal, the company said it worked with “the Air Line Pilots Association (ALPA) to reach an agreement to greatly enhance pilot pay structure, adding incomparable value to pilots’ compensation, standard of living, and career progression.”
We are pleased to announce PSA is now the highest paid regional in the airline industry! Benefits also include: 121 Longevity match, FO pay starting at $90/hour, Captain pay starting at $146/hour, 200% pay credit for LCA, 5 year flow to American Airlines. https://t.co/2fomMe50MT pic.twitter.com/lNJ8pTXvOq— PSA Airlines (@PSAAirlinesInc) June 16, 2022
The terms of the deal are similar to what American Airlines’ two other regional partners, Piedmont and Envoy, announced earlier this week, which will make American’s regional pilots the highest paid across the regional airline industry. Specifically, first officers will see first-year pay starting at $90 an hour, up from $51, while first-year captains will earn $146 an hour, up from $78. PSA, Piedmont, and Envoy pilot wages are now 50 to 70 percent higher (57 percent on average) than the next highest paid regional carrier, Endeavor, the wholly owned regional carrier for Delta Air Lines (NYSE: DAL). With bonuses, PSA said its pilots can now expect to earn 10 percent more over the next five years than their peers at leading low-cost, ultra-low-cost, and cargo carriers.
The pilots who benefit the most are line check pilots, who will receive a 200 percent pay credit. At the same time, full-time simulator instructors, proficiency check pilots, and aircrew program designees will also see a significantly increased pay credit.
PSA’s enhanced flow structure will also match that of its American Airline’s wholly owned peers, which promised they would pay the 20-year captain’s rate to any pilot who hadn’t been offered a position at American Airlines by the end of their fifth year of service.
This latest move by American to shore up its workforce comes after the airline said it had to park nearly 100 airplanes because it couldn’t find enough pilots at the regional level to fly them. Moreover, two U.S. senators who serve on the Senate Commerce Committee, which monitors the aviation industry, have called on the Department of Transportation to begin holding airlines to a higher standard amid these cancellations.
After nearly 2,800 flights were canceled over Memorial Day weekend by multiple airlines, Senators Richard Blumenthal and Edward J. Markey said they appreciated that airlines needed to increase their staff to meet the public demand for travel, but that flight cancellations were burdensome to the public.
“Such occurrences pose significant hardships to the traveling public,” the senators said in a statement. “We urge the airlines to take all necessary steps to mitigate those disruptions.”
With American’s regional partners’ pay now rivaling that of the first-year salary of the four major carriers, in addition to their one-to-one matching compensation scheme to recruit pilots from other airlines, other regionals could follow their lead soon to attain or retain pilots.