In the News

Heathrow posts operating loss of nearly £1 million a day

Geoff Riley

29th July 2022

Britain’s biggest airport is losing nearly £1 million a day according to newly-released figures.

An adjusted pre-tax loss of £321 million comes at a time when the airport is being pilloried for poor service which has included numerous flight delays, a cap of 100,000 passengers a day travelling through Heathrow and some flights being cancelled even after passengers had boarded.

The airport faces rising costs from numerous directions and has passed some of these on through higher charges to airlines.

One of the biggest challenges is staff shortages - according to this report in the Guardian, Heathrow has hired 1,300 people in the past six months - not an easy task given the low level of unemployment in the area surround the airport and the unattractive nature of the work.

Heathrow has some monopsony power in the local labour market, but post-pandemic, many people are recalibrating which types of jobs they are willing to take on.

Having made thousands of workers redundant during covid lock-downs, it is no surprise that many people are reluctant to return.

The balance of negotiating power in this particular segment of the labour market has changed.

Geoff Riley

Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.

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