$10,000 offers to get off a plane, CEO apologies and free pizza: Here’s how a massive labor shortage and pent-up demand helped create a chaotic summer for airlines

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Each holiday weekend this summer has ended in chaos for many travelers facing huge numbers of flight cancellations and delays. July Fourth weekend could likely be more of the same.

More flights have already been delayed in 2022 compared to any year in the past decade, according to data from the Bureau of Transportation Statistics, with cancellations also near record highs. Airlines have offered travelers everything from pizza during delayed flights, to $10,000 cash to get off overbooked planes. And the CEO of Delta apologized to passengers for the flight disruptions.

More than two years into the COVID pandemic, people have started to travel again, and as demand rebounds, experts say that airlines are struggling to accommodate with a labor pool of pilots that shrunk two years ago and has yet to recover.

“The pilot shortage for the industry is real, said United Airlines CEO Scott Kirby on a quarterly investor call in April. “And most airlines are simply not going to be able to realize their capacity plans because there simply aren’t enough pilots, at least not for the next five-plus years.”

To confront the surge in travel disruptions, lawmakers have threatened to impose punishments on airlines for overbooking flights while airlines themselves have moved to increase compensation packages to attract and retain pilots.

Here’s what’s going on with summer travel.

A pandemic-tightened labor supply

The airline industry took an enormous hit in early 2020 when the pandemic halted the majority of air travel, and lockdowns kept millions of Americans and international fliers at home.

To keep airlines afloat, Congress provided a total of $54 billion to the industry in three rounds of support over the course of 18 months. The funding was designed to keep payrolls intact so that there would be enough pilots, maintenance staff, and flight attendants once restrictions lifted and people began to fly again.

“All of it was to ensure two things,” says Capt. Dennis Tajer, who flies for American Airlines and serves as communications chair for the airline’s union, the Allied Pilots Association (APA). “One, the airline industry does not collapse. Two, that the airline industry is ready for the recovery.”

The first, he says, was a success, but the second a failure.

As part of the terms of the first round of federal support, airlines could not furlough or lay off their workers. They could, however, incentivize workers to leave, which they did by offering early retirement packages to pilots nearing 65—the age at which pilots must retire by law.

As a result, thousands of pilots likely left the workforce early, according to Tajer. At American alone, 715 pilots volunteered for early retirement in 2020, the APA told the Dallas Morning News.