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Comment by joe_the_user | Hacker News Reader

That's paradoxical seeming isn't it?

But low-pay + labor shortage is seems to be a common thing.

I would speculate it's driven by the production of a very price sensitive commodity. Lots of people choose the cheapest flights possible regardless of other considerations so a significant rise in pilot pay might make a given airline unprofitable since they can't raise prices to compensate.

So airlines feel strong pressure to keep wages down.

And really, you could say a "labor shortage" is what every high volume, low margin operation complains about but the reality is basically "we pay low wages so it's hard to get enough people to work for our low wages". (Obviously, with airline pilots, it's low wage relative to the cost of gaining the skills etc). We can see similar language with H1b visa proponents and even fast food restaurant operators use it periodically.

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It doesn't matter how price sensitive your product is, you can raise prices a little and pay people a little more to help with hiring. There's a point of equilibrium somewhere.

"Labor shortage" is just a tactic to get someone else to help with the problem in a way that doesn't require increasing pay. It's the hiring equivalent of "don't miss this exclusive sale!"

I'm not sure if the cost of flights would really go up that much.

Just to play with some numbers, let's consider a pilot with a salary of an astronomical $1,000,000/yr who flies transatlantic flights on wide-body jets (300 or so passengers). She is limited to 1,000 flight hours/yr, so each hour costs the airline $1,000. For an 8 hour flight, $8,000 split between 300 passengers is about $26 per person. Given that these flights come in around $150 at the cheapest, often going up to $1,000 at peak times, this (quite high) wage estimate doesn't translate into a huge price for the consumer (especially since you could shift more of the cost towards the first- and business-class passengers).

I think the numbers work out similarly for regional flights which have fewer passengers but shorter time in the air. These pilots start with base salaries in the $30,000 range; if that were raised to $100,000 for flying (for example) 3 hour flights with 50 passengers, that's only ~$4 extra per passenger per flight.

There might be other factors I'm missing - do these pilots actually fly significantly less than 1,000 hrs/yr?

You should check this video out: https://www.youtube.com/watch?v=6Oe8T3AvydU

You would be pretty surprised how many costs airlines have to pay. An extra $4/passenger/flight would eat significantly into their bottom line. This is especially true for budget airlines, which often already make less than this per passenger already (source: https://www.youtube.com/watch?v=069y1MpOkQY)

Your $4/pilot/flight misses the overall point. A company in a highly competitive industry is going to be minimizing costs across the board. To keep a plane in the air, you need mechanics, pilots, flight crew and so-forth. You could be completely spendthrift with just pilots and hold the line on everything else but then the potential for the rest of your personnel to be jealous is high. Moreover, what's the motivation?

"You cheap bastards could easily afford XXX" misses the point. A large company runs on general principle, and company that's producing at minimal cost is going to run on the principle of saving money everywhere.

> Lots of people choose the cheapest flights possible regardless of other considerations so a significant rise in pilot pay might make a given airline unprofitable since they can't raise prices to compensate.

In addition, certain airlines have the backing of massive nation state funds or are otherwise simply enormous - just like cheap venture capital, they can simply drown smaller competitors, buy their slots and airliners for a penny on the dollar and then jack up the prices. Lufthansa and AirBerlin are a perfect example.

" Lots of people choose the cheapest flights possible regardless of other considerations ". so true, and then they complain when there is extra cost for bags etc. it's the customers that drive the airlines to eliminate all frills or things that use to be 'free'.

It's very simple. There's not actually a labor shortage. If there were, the flights would constantly be sold out and there would be empty planes on the ground due to no pilots.

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