Passenger airports are struggling to make ends meet

Erika Beras Aug 10, 2020
Heard on: Marketplace
The United Airlines check-in counter at San Francisco International was vacant in early August. Daniel Slim/AFP via Getty Images

Passenger airports are struggling to make ends meet

Erika Beras Aug 10, 2020
The United Airlines check-in counter at San Francisco International was vacant in early August. Daniel Slim/AFP via Getty Images

The pandemic has been particularly brutal for just about every business that touches air travel. 

That’s most visible with the airlines — they’ve been cutting back flights and preparing to lay off workers. But it’s also hitting the country’s airports. They’re on track to lose at least $8 billion in revenue this year, a trade group estimates. 

Before the pandemic, the Missoula, Montana, airport used to handle a couple of thousand passengers a day. 

But when COVID-19 hit, “you could walk in and roll a bowling ball through the building and never hit anybody,” said Cris Jensen, the airport’s director. “It was really kind of surreal.”

On its slowest day, only 40 passengers passed through the Missoula airport. Now, it’s back to about half the traffic it had before the pandemic. But that means it’s still bringing in a lot less revenue — from airline landing fees, passenger use fees, parking. 

“Every time you buy a meal at a terminal restaurant or a newspaper or a magazine at the newsstand or use a rental car, you’re paying a fee to the airport,” said Bob Mann, an industry analyst. 

The trouble is, we’re doing a lot less of that these days. 

“In a nutshell, it’s a bloodbath,” Mann said.

TSA agents stands in a deserted airport terminal at San Francisco International Airport on Aug. 2.
TSA agents on duty in a deserted terminal at San Francisco International Airport. (Daniel Slim/AFP via Getty Images)

And when it comes to stopping the bleeding, airports are pretty much on their own. Essentially, they are their own financial ecosystems. They generate their own revenue, and with a few exceptions, “revenues generated at the airport have to stay at the airport,” said Janet Bednarek, the author of “Airports, Cities and the Jet Age.” 

Some airports are trying to squeeze more revenue out of operations during the pandemic. At Orlando International Airport, CEO Phil Brown said that means handling different kinds of cargo. 

“We’re really looking at it, really trying to raise the game, if you will, for cargo to more high-value cargo that needs to be delivered quickly,” Brown said.

Pharmaceuticals and personal protective equipment, for example, instead of packages for the Postal Service and FedEx.

Missoula’s airport took a different approach to weathering the downturn. Jensen said it was all about cutting spending.  

“I don’t believe there was a single point in our budget that wasn’t impacted,” he said. “Whether you’re talking office supplies or personnel — we really went top to bottom, left to right, and cut every possible category.”

At the end of the day, though, the only way airports are going to recover is if passenger aviation recovers. 

COVID-19 Economy FAQs

With a slow vaccine rollout so far, how has the government changed its approach?

On Tuesday, Jan. 12, Health and Human Services Secretary Alex Azar announced changes to how the federal government is distributing vaccine doses. The CDC has expanded coronavirus vaccine eligibility to everyone 65 and older, along with people with conditions that might raise their risks of complications from COVID-19. The new approach also looks to reward those states that are the most efficient by giving them more doses, but critics say that won’t address underlying problems some states are having with vaccine rollout.

What kind of help can small businesses get right now?

A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.

What does the hiring situation in the U.S. look like as we enter the new year?

New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.

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