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Could the maritime industry provide the answer for European aviation?
Another week, another press release voicing concerns about social dumping in the aviation sector. This time, it was the turn of the European Economic and Social Committee (EESC) to call for further restrictions on the use of indirect employment contracts in the aviation industry and the outsourcing of airline staff to lower-wage countries.
Some have suggested that the maritime industry may offer a solution to European aviation’s labour woes. Back in 2004, the European Commission made an exception to the state aid rules to allow individual states to reduce labour taxes for European crew working on ships registered in an EC country. This move was designed to encourage ships to be registered under their national country flag – rather than under the flag of a third country – and to employ local staff for high-quality shipping jobs.
The Commission’s decision in 2012 to maintain the maritime state aid guidelines is a clear signal of its belief that the state aid had positive effects on employment and competitiveness. One report, albeit for the industry lobby-group the European Community Shipowner’s Association, estimated that around half as many EU citizens would have been employed in the shipping industry had it not been for these state aid measures.
Based on current evidence, applying similar state aid rules to the aviation industry is a solution to a problem that doesn’t even exist. In the much-heralded report from the University of Ghent on employment in aviation, over 90% of the pilots questioned came from a European country and those that weren’t European came predominantly from Canada, the US or Australia. Not exactly a flood of low-paid workers.
As we’ve previously discussed, the arguments from the likes of the EESC are less about the social aspects of airline’s ability to source cheaper labour, and more about the competitive threats this poses. Those playing Aviation Advocacy’s new bingo game will be pleased to hear the EESC mentions level playing field, fair competition and unfair advantages several times each.
Changing the state aid rules for aviation to address competition concerns would also be the start of a slippery slope. It reinforces the attitude that the competitiveness of the industry relies on government actions and support rather than on business decisions. It also sets a precedent for government intervention that could lead to an industry that competes based on the generosity of its governments rather than its product. That boat sailed in the 1990s.
