The Los Angeles Alliance for a New Economy has released a new report calling for major subsidy recipients, such as airlines operating at Los Angeles International Airport, to help improve job standards and passenger services.
In its report “Shortchanged: How Airlines Can Repay Taxpayers for Billions in Subsidies by Improving Jobs, Security and Services,” the Alliance for a New Economy noted that airlines have received nearly $8.5 billion in taxpayer subsidies since 2001.
The report found that the airline industry has benefited from strong taxpayer support, yet has failed to provide a fair return on the public’s investment, creating poor quality jobs and providing inadequate security and services for passengers.
The study concluded that despite the industry’s current financial crisis, it is essential that major airlines such as American, United and Delta take measures to improve safety, service and job standards, as well as to ensure the long-term health of the airline industry.
“Taxpayers have invested billions in the airline industry but we’re getting shortchanged because airlines are not providing good jobs for workers or good service to passengers,” said Carolina Briones, lead author of the report, which was co-released by the East Bay Alliance for a Sustainable Economy and Working Partnerships USA.
“It’s true that the airlines are facing financial challenges right now, but they must do more to improve jobs and ensure a high level of passenger safety and service.”
In addition to the estimated $8 billion received in federal assistance since 2001, the airlines have also benefited from an estimated $487 million in state and local subsidies in California alone, including tax exemptions and low-interest bond financing, the report found.
The “Shortchanged” report urges the airline industry to provide a fair return on the public’s investment by providing middle-class jobs and ensuring quality service and passenger safety.
But Jack Kyser, chief economist for the Los Angeles County Economic Development Corporation, said it was not the right time for such a report to examine the situation, as the “airline industry right now is under extreme stress” with record-high fuel prices.
“It doesn’t speak to the knowledge of the current airline industry,” Kyser said of the report. “You need to consider the current and future health of the industry you are trying to make headway in,” when conducting such a study, he added.
Kyser also noted that the airline industry is not unique regarding the issue, as other transportation agencies also receive sub- sidies.
Briones noted that the report authors did consider the current economic climate of the industry when putting together the study.
While a 2007 study of airline-contracted workers at LAX found that airlines were not providing adequate training to service workers, Briones said local airports are taking steps to improve the conditions.
“In order to provide high-quality service to passengers, airlines need to invest in their workforce by providing adequate training, fair wages and family health benefits,” said Briones.
Founded in 1993, the Los Angeles Alliance for a New Economy says on its Web site that it “is recognized as a national authority on issues affecting the working poor and an innovator in the fight against working poverty.”