Finnair to Cut Jobs as Airspace Exclusion Looms

DALLAS — Finnair (AY), Finland's flag carrier, has announced layoffs to restore profitability following the closure of Russian airspace.

Finnair states that approximately 90 jobs will be cut in Finland while 57 jobs will be lost globally.

The airline announced in September various measures, such as fleet reduction, layoffs, and stronger alliances, to combat the negative effects of the airspace closure. Because of the closure of Russian airspace, the carrier is unable to service cash cow routes in Asia via short northern routes.

The Helsinki-based carrier is currently grappling to achieve pre-pandemic profitability levels not only stemming from the Ukraine war but also from high fuel prices and the looming effects of the pandemic. As such, the restructuring of operations is seen as a lifejacket for AY.

Finnair's Comments, Staff Strikes

Chief executive Topi Manner stated that he was "deeply sorry" that the "difficult but necessary" job cuts had to be implemented while mentioning that the airline's labor force had already experienced a "stretch" during the pandemic.

Finnair said this measure also affects 770 staff members employed in Finland's executive, managerial, and specialist roles. The employees who will feel the burn of these measures will be offered support for re-employment through avenues such as career coaching and training.

Since these announcements, AY employees have been uneasy, and cabin crew members staged a 24-hour strike between November 20 and November 21, 2022. AKT, the transportation workers' union, expressed that the walkout was to protest the airline's personnel policy.

For AY, the strike is "illegal," leading to the cancellation of approximately 100 flights heading out of Finland's capital, Helsinki.

The airline now says that measures were taken to improve crew utilization efficiency such as additional pay-per-hour rules for long-haul services given the extended flight duration on the Asian routes.

An Ongoing Disagreement

Finnair announced salary cuts during the fall, which led to counter-proposals by the cabin crew that were not accepted by the airline.

AKT believes that the carrier threatening to cut 450 jobs and outsource cabin crew on their North American and Thai routes will find that demand for these routes has almost returned to pre-pandemic levels.

The cabin crew and the airline have yet to come to an agreement, therefore, the airline states it will be looking into "alternative measures" such as subcontracting cabin service.

The airline may close the fourth quarter in an unfavorable position as the Ukraine war shows no signs of easing soon, fuel costs remain high, and the wounds of the pandemic are still afresh.

Featured image: Brandon Farris/Airways