Australia is facing a pilot crisis, as US airlines poach Qantas, Virgin and Rex recruits

The Australian airline industry has a pilot crisis. Every commercial airline in the country is desperately trying to recruit. It’s hitting the lower paying regional airlines hardest and a growing part of the problem is the quality of pilots now flying commercial airlines. 

It’s part of a broader global shortage of both pilots and maintenance engineers. In Australia, it’s being made worse as Australian airlines battle pilot unions over salaries and conditions while a growing list of international operators implement an increasingly aggressive recruitment strategy.

Australia is uniquely vulnerable to poaching by US airlines due to the availability of E3 work visas for pilots under the US-Australia Free Trade Agreement. In addition to better pay and conditions, Crikey understands some are offering sign-on bonuses for captains as high as US$100,000 (A$151,000).

“We have frequently highlighted the looming severe pilot shortage in Australia and the urgent need for strategic measures before it reaches a crisis point. We emphasise the potential risk to regional connectivity and economies around the country,” the Australian Federation of Airline Pilots told Crikey in a statement. 

“Pilots are taking work offshore because these jobs are better paid than they are in Australia. It is time for the Australian operators/companies to acknowledge wages and conditions need to improve to attract and retain pilots.”

Crikey has learned that five pilots at Qantas’ Perth-based regional subsidiary Network Aviation quit in the past week, leaving for offshore airlines including Emirates and Cathay Pacific.

The problem has been a long time coming, born in part of the COVID-19 years — the number of flights was cut by more than half in 2020 and flight numbers are now being exacerbated by accelerating demand. 

The pandemic led to a surplus of pilots with airlines offering them early retirement packages and letting go of too many pilots, as well as engineers and cabin crew in order to cut costs. The problem is that only cabin crews can be replaced with speed and they are quicker to train.

But air travel has boomed once more according to the International Air Transport Association, returning to pre-pandemic levels. International traffic in 2023 climbed 41.6% from 2022 and reached 88.6% of 2019 levels. In the fourth quarter of 2023, traffic was at 94.5% of 2019 levels.

Many airlines have been forced into a reduction in the number of flight schedules due to a shortage of pilots and crew, leading to an increase in delayed and cancelled flights. The latest data from the federal government’s Bureau of Infrastructure and Transport Research Economics (BITRE) showed only 73.4% of domestic flights arrived on time in January, and 3.1% were cancelled, well short of the long-term averages of 81% and 2.2%.

As the size of the aircraft fleet continues to increase worldwide, coupled with the recovery of air travel to 2019 levels by 2023, the pilot shortage will accelerate. Projections show the pilot shortage in the Asia-Pacific could reach more than 22,000 pilots by 2025.

The pilot problem’s first public victim was Rex, which has been forced to cut regional services as it cannot properly crew its fleet of 57 SAAB propeller planes, whose pilots are at the very bottom of Australian pilot pay scales. Rex cut services on several routes last September and late last month confirmed they would remain on ice for a further seven months at least.

While the official line has been supply chain and spare parts issues, industry insiders tell Crikey that a lack of pilots is the real problem. Qantas has “frozen” its pilots at regional subsidiaries (National Jet Systems, Sunstate, Eastern and Network Aviation) that run its QantasLink and fly-in-fly-out charter services, leaving them unable to apply for better-paid jobs in the company’s Jetstar and mainline divisions. Ironically, this now leaves a shift to Virgin, for instance, as a quicker path to a job, one Qantas mainline pilot told Crikey. 

Jetstar’s lack of pilots was also on display last week when it said it had made a range of changes to its recruiting policy and would consider employing pilots (rather than first or second officers) from outside the company for the first time, to fill five vacancies in Perth and eight in Sydney, according to an email from chief pilot and head of flying operations Tyrone Simes obtained by Crikey. Rex and Jetstar declined to respond to questions from Crikey.

While Virgin said it “continues to see interest from the pilot community to join Virgin Australia Group”, with its Brisbane information days booked solid until August, it continues to leak pilots to Qantas mainline, pilots told Crikey. Virgin is seeking 20 new pilots and 80 first officer pilots over the next 12 months — after only successfully employing a net four pilots in the past four months, according to company insiders. Sixty-five Virgin pilots are moving to Qantas (with start dates) and about 10 per month returning or heading overseas.

The ensuant problem, especially for regional airlines, is the declining quality of new hires for first and second officer positions. In coming years, a significant proportion of current pilots will also reach retirement age, leaving a considerable gap of expertise.

“It’s not the fault of individuals, but the tight supply. Pilots are coming with far fewer flying hours and less traditional ‘out bush’ experience that gives them the ‘near miss’ type of experiences that pilots need to cope with emergencies,” a senior pilot manager at a major airline told Crikey. Qantas is also fast-tracking cadets from its Toowoomba academy into better jobs ahead of those who have done time in regional jobs, creating something of an “us and them” culture, pilots said.

As the AFAP noted, the retention (and training) of Australian pilots in Australia requires a whole-of-industry approach. Yet the Albanese government continues to sit on its hands as it waits for the Aviation White Paper to be completed “mid-year”.

There were few solutions offered in last year’s Green Paper that preceded it, and Transport Minister Catherine King — a member of the Qantas Chairman’s Lounge and recipient of 750,000 Frequent Flyer points from the company last year — has shown no signs of trying to rein in Australia’s dominant airline.

Only last week, Qantas jacked up its prices for the second time in six months. This means more revenues feed its multi-billion dollar bottom line, leaving it in the best position to compete for available pilots — of course, not all pilots want to move offshore — and stymie its competitors.