Who is to blame for the increase in high-profile airliner accidents and incidents in 2024 and into 2025? Is it DEI, airline safety practices, or government intervention? Here’s another perspective on the matter.
Throughout 2024, there was a steady increase in airline accidents and incidents globally, with a notable uptick toward the latter part of the year, particularly involving high-profile cases. The blame has been spread widely—some point to diversity, equity, and inclusion (DEI) programs within airlines, others to relaxed or heightened regulations and interference, while still others blame the airlines and aircraft manufacturers themselves.
In this article, we take a different approach—one that may not provide the sole explanation but does factor into the situation nonetheless. Here are some considerations beyond the usual scapegoats often cited for the rise in airline accidents and incidents:
- Inflation Is Increasing: Even though inflation dropped from its 2022 high of 9% to a low of approximately 2.4%, we predicted inflation would rebound—and it may even surpass the 9% mark set in 2022.
- Rising Costs of Personnel: Due to inflation, hiring talented individuals capable of managing airlines, particularly in safety-critical areas, has become significantly more expensive.
- Increased Operating Costs: Inflation has led to rising costs across all operational areas, creating additional financial pressure on airlines.
Get Involved: Do you agree with the argument laid out in this article, or do you believe that DEI, government intervention, or airline negligence is responsible for the increase in accidents and incidents? Please share your thoughts in the comments below.
Inflation Trending in the Wrong Direction
In previous editions, we predicted that inflation, though it had moderated from its peak in 2022, would begin to rise again—and may exceed previous highs. Here’s why:
- Low Interest Rates from the Federal Reserve: By keeping interest rates lower than necessary to combat inflation, the Federal Reserve has inadvertently fueled inflation. Moreover, the decision to begin lowering interest rates further exacerbates the problem.
- Fiscal Policies: We’ve discussed extensively how government fiscal policy impacts inflation. It’s worth repeating that when the government spends money—particularly when that money is borrowed—it increases the money supply in the economy, fueling inflation.
On Aviation™ Note: These two factors are the leading drivers of inflation. Not only are they not decreasing, but they are also actively increasing.
Airlines’ Increased Costs for Recruiting and Retaining Top Talent
Many observers note that wage growth hasn’t kept pace with inflation over time. This disparity significantly impacts airlines’ ability to recruit and retain top talent.
- Personnel Costs: These are typically an airline’s largest expense, followed closely by fuel costs. However, at times, fuel costs can surpass personnel expenses depending on oil prices. Airlines are struggling to afford the best talent, leading to a reliance on lower-tier candidates to meet budget constraints.
- Training Cutbacks: To save costs, some airlines may reduce or eliminate training deemed non-essential. While this is not widespread, it contributes to a culture of cost-cutting that can have spillover effects on safety protocols and maintenance practices.
On Aviation™ Note: While there is much speculation about DEI being the cause of increased incidents, we refrain from commenting on this without concrete research or studies to support such claims.
Increased Overall Operating Costs for Airlines
Beyond personnel, airlines face other substantial operating costs exacerbated by inflation:
- Maintenance Costs: Inflation drives up the cost of maintaining aircraft, a significant budget item for airlines. Recent incidents have been attributed to poor maintenance practices, which may stem from financial pressures.
- Operating Older Aircraft: Due to the high cost of purchasing new aircraft and ongoing issues with manufacturers like Boeing, airlines are operating older fleets longer than usual. Maintaining older aircraft is costlier and increases the likelihood of component failures if proper maintenance isn’t sustained.
- The Dreaded Corner-Cutting: While cutting corners is universally condemned in the aviation industry due to its impact on safety, financial pressures may lead operators to trim costs in processes and procedures they believe can be done safely.
On Aviation™ Note: While fuel prices are not at all-time highs, they remain a concern. Our prediction is that oil prices may rise again, presenting significant challenges for airlines in the near future.
Conclusion
Listening to mainstream narratives, one might conclude that the top factors driving increased airline accidents are DEI, government intervention, or airline negligence. However, at the risk of oversimplifying the issue, we propose that inflation plays a significant role in these events. Ignoring this factor would overlook a critical component in mitigating risks moving forward.
The last thing we want is to focus on scapegoats while leaving out a vital cause of the problem. Without addressing inflation’s role, the industry will fail to improve, and the situation may worsen.
Thank you for reading this week’s On Aviation™ full article. Do you agree with the argument laid out in this article, or do you believe that DEI, government intervention, or airline negligence is responsible for the increase in accidents and incidents? Please share your thoughts in the comments below. Remember to check out our On Aviation™ Podcast and continue the conversation on our Twitter and Instagram.
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