What is a pilot really worth?

[.......]

I am glad you mentioned inflation at the end...In the 1960s, 150k , after tax bought a pretty nice hourse. Now a 150k (at a higher tax rate) is hardly a downpayment on a house....Inflation has a very eroding effect on numbers.
Perhaps rework your numbers in 1960 dollars, and see what the average airline pilot is really making.

Also, a return ticket to Paris from YUL cost around $800 in 1978... $2900.00 in 2012 money, but companies have to charge even less than the 1978 figure to fill the seats.

So who's on the losing end here?

[peterpan]

I drive a bus. Last year I grossed $105,000. This year is my third year driving and I will likely earn 10-20k more.

I also have a CPL and ME-IFR with a few hundred hours. I left my first flying job to drive a bus.

Where do you work? City bus or highway?

Where do you work? City bus or highway?

I drive charters in a newer 55-passenger highway coach (worth around $650k). Also, I'm paid better than most drivers and work way too much. Just a rough estimate, but a transit driver in a big city would gross about 50k. A coach driver working hard for 6 months in the tourist season would also make about 50k.

I don't mind driving but all things being equal I would prefer to fly.

[WileyCoyote]

I drove a concrete mixer truck for years to get through flight school, and still do for extra cash. Working full time I was grossing between 65 and 70k/year, most of it in the 8 months of the busy season. I worked the occasional Saturday, and had every Sunday off and slept in my own bed. It's a job after a year someone can be proficient at if they pay attention. I think the biggest problem we are facing is inflation, and that fact that aviation seems reluctant to pass the costs to the customer. The short term pain is worth it.

[Gannet167]

I am also tired of the term "market value" that's pure BULLSHIT!

Sorry slowstream, it's not a "term" it's a fact of economics. Every single point on this thread can be boiled down to and explained completely with market forces. Supply and demand, It should be taught in basic flying 101. Please tell, if it isn't market value what is driving the wages of pilots? Is it the alignment of the moon and stars? Why do employers offer low wages? Why to guys accept them? Pure economics.

We sold it on our own, sold it for 375K, 25K more than they said

I guess the realtor wasn't too sharp - good thing he's not a pilot. But you're making my point for me: you got 375 because someone was willing to pay 375 - it was worth that much to the buyer. Not because you "controlled" the situation or you used the force etc.


You can only get out of a commodity what it's worth, which be definition and actuality is what someone is willing to pay for it. Pilot labour is a commodity. Sure some pilots are amazing and others not so much. But unless you're running a squadron of fighter pilots, it doesn't really matter who's top gun. If the guy is type qualified and passes the interview, he's good to go, just like any other guy who can do the same resume.

If you aren't paid well enough, leave the profession (reducing supply) and work somewhere else, you'll likely make better money. You can't regulate that a pilot is paid a minimum wage any more than you can limit what anyone is paid. All you can do is restrict supply - maybe the exams and requirements should be far stricter and limit how many guys enter the pilot labour market. (And maybe not just for economics, maybe for the benefit of the profession, flight safety etc).

Although tickets are cheap, there are a hell of a lot more planes in the sky than in the 1978 when you compare a ticket to Paris. All those planes mean a lot more pilots are employed. The industry has grown because of lowering costs. If we drive up the cost of pilot labour by restricting supply of new pilots, costs rise and ticket prices will rise. The industry will shrink. It may not contract by much but simple economics say that it has to somewhat.

There are many jobs where people have highly skilled roles with great responsibility - some are paid more some are paid less. But what pilots have against them is what we do isn't that hard to get into (Although it may be difficult to do it WELL, look at the vast #'s of us out there holding licenses) and it's actually quite enjoyable. People are willing to work for cheap because they like to fly. If flying was not enjoyable at all then given the amount of work to be trained and the skill involved, it probably would pay considerably more. I'm sure a good number of guys would be male porn stars for free - in fact even pay the producer to show up to work every day.

Military pilots pay full tax, like any other Canadian pays. They also go through boot camp, are subject to the military code of discipline, are posted all over the country/world every few years, work long hours doing significant administrative secondary duties that have little or nothing to do with flying. They also deploy to war zones (both as aircrew and doing ground jobs) and generally do at least one ground tour in their career, sitting at a desk. They do get their training for free. All this makes them a difficult group to compare against commercial pilots.

[slowstream]

I am also tired of the term "market value" that's pure BULLSHIT!

Sorry slowstream, it's not a "term" it's a fact of economics. Every single point on this thread can be boiled down to and explained completely with market forces. Supply and demand, It should be taught in basic flying 101. Please tell, if it isn't market value what is driving the wages of pilots? Is it the alignment of the moon and stars? Why do employers offer low wages? Why to guys accept them? Pure economics.

Gannett167,

Actually "Market Value" is a term, a term that was created by a business accountant a number of years ago, I'm fairly certain he got the idea after studying alignment of the moon and stars, sorry sarcasm does NOT prove your point or is it needed and I won't step down any further into that mud-pit. I am well aware of the term supply & demand and was very likely using it long before you were even born. I am not arguing the supply and demand or the principals of the economics. As far as teaching supply & demand, I would agree, I would also suggest a good number of other topics that should be taught but then that would likely not be a good business idea adopted by flight schools as the truth would hurt business, correct?

Terms like "market value" and other misdirections are methods or tools used to control elements of business and its these types of business practices that I take issue with. These practices are NOT unique to aviation, in fact its become common place in most developed countries and arguably it could be stated that it is a major contributing factor for some of the G20 countries economic problems. Conglomerates buy up companies and use profitable companies to prop up less profitable ones or companies losing money due to any number of reasons including poor management. We have all seen airlines use these same models and as they siphon off money from the airline they tell the pilot group that the airline can't afford higher wages. I've personally watched corporations/conglomerates/airlines do this and its not difficult to find; the airline has made money, dividends were paid and bonuses were paid. Its common practice in business these days and like I said it could be argued as to whether its good for the economy and again I am not arguing the principals of economics.

Economic practices could be argued all day by many including by myself; what I was trying to say is because its a common practice does NOT make it right. I also don't believe that it will be proven to be a good move in the long run for the industry or for some airlines.

We sold it on our own, sold it for 375K, 25K more than they said

I guess the realtor wasn't too sharp - good thing he's not a pilot. But you're making my point for me: you got 375 because someone was willing to pay 375 - it was worth that much to the buyer. Not because you "controlled" the situation or you used the force etc.

No, the Realtor wasn't too sharp, nor was he ours, nor did he sell our house or make any commission on it; but he wasn't alone in his assessment. There were a four other realtor's who viewed our house who all gave a similar value and again saying this is what the market value is given sales in the area. I guess my wife and I proved them wrong and also discredited the "market value" of our house. But I suppose I was able to show someone the value of the craftsmanship and what it was really worth.

can only get out of a commodity what it's worth, which be definition and actuality is what someone is willing to pay for it. Pilot labour is a commodity. Sure some pilots are amazing and others not so much. But unless you're running a squadron of fighter pilots, it doesn't really matter who's top gun. If the guy is type qualified and passes the interview, he's good to go, just like any other guy who can do the same resume.

If you aren't paid well enough, leave the profession (reducing supply) and work somewhere else, you'll likely make better money. You can't regulate that a pilot is paid a minimum wage any more than you can limit what anyone is paid. All you can do is restrict supply - maybe the exams and requirements should be far stricter and limit how many guys enter the pilot labour market. (And maybe not just for economics, maybe for the benefit of the profession, flight safety etc).

Is pilot labour a commodity or is it an expense associated with doing business? It could be argued just as the definition could be. What I think the original question was though is, "Whats a pilot worth". I think pilots are worth more than the industry is currently paying and many airlines can afford to pay crews better. I also don't require you to tell me leave my profession if I am unhappy with my pay.

Is there a cause and effect associated with higher costs? Yes, of course there is, is to the extreme that some would suggest? No.

As I suggested before because its common practice does not make it right.

Business practices just as with politics are all too often about control, controlling people, perceptions, numbers, greed and public image.
I don't see any of these practices going away anytime soon; and again nor is it right.

Are pilots worth more? Yes

[Colonel Sanders]

many airlines can afford to pay crews better

Sure, but they don't have to, as long as there is a sufficient supply of pilots.

Why, oh why do pilots think the laws of economics that apply to every other business don't apply to them?!

Not sure this will help anyone, but: http://en.wikipedia.org/wiki/Economic_rent

The generalization of the concept of rent to include opportunity cost has served to highlight the role of political barriers in creating and privatizing rents. For example, a person seeking to become a member of a medieval guild makes a huge investment in training and education, which has limited potential application outside of that guild. In a competitive market, the wages of a member of the guild would be set where the expected net return on the investment in training would be just enough to justify making the investment. In a sense, the required investment is a natural barrier to entry, discouraging some would-be members from making the necessary investment in training to enter the competitive market for the services of the guild. This is a natural "free market" self-limiting control on the number of guild members and/or the cost of training necessitated by certification. Some of those who would have opted for a particular guild may well decide to choose a different guild or occupation.

However, a political restriction on the numbers of people entering into the competitive market for services of the guild has the effect of raising the return on investments in the guilds training, especially for those already practising, by creating an artificial scarcity of guild members. To the extent that a constraint on entrants to the medieval guild actually increases the returns to guild members as opposed to ensuring competence, then to that extent the practice of limiting entrants to the field is a rent seeking activity, and the excess return realized by the guild members is economic rent as defined.

Now, does anyone see a parallel which could be drawn between the hypothetical "medieval guild" above and holding an ATPL? Bueller?

[Gannet167]

Slowstream: So... all that to say what? What are you saying with that big rant? Pilots are worth more? Worth more what - money? I think we can agree that they ought to be worth more and it'd sure be nice if they were, but what anything is "worth" is what people are willing to pay. How can you possible say they are worth more than what people are willing to pay - if that's precisely what they're willing to pay for it? Why should airline X give you a pay increase if they don't have to? To be nice guys? I think their shareholders would prefer that be spent on capital or issuing a dividend.

"Market value" was not invented by any "business accountant" (hmm. "business" accountant, never heard of that designation...) It's a concept proven time and again over thousands of years. It dates back to early academics but has been noted by such greats as John Locke in the 1600's It's a "term" as much as "gravity" is merely a concept/term. It's the real world and no level of hypothetical enthusiasm (even Karl Marx's) can out wit the basics of micro-economics.

I'm not sure what business school you went to, but they have some strange concepts. You also have no idea when I was born, so if sarcasm doesn't work for you, you might try not dishing out out yourself.

A handful of gold is worth quite a bit - because it's rare and in demand and people are willing to pay whatever the market rate is for it. A similar amount of lead, although chemically somewhat similar is worth very little comparatively, as it's relatively plentiful compared to gold.

I'm not telling you to leave your profession - but if a business is willing to pay $X for a commodity (labour is often considered a form of commodity) then you can either take the going rate, go into business for yourself, or leave that type of business. Legislating a rate for labour works only in socialist states and for services provided by the state.

Pilots are worth exactly what they get paid - as is gasoline worth exactly what it's trading for on the open market. Sure, you may feel that given the merits of commodity X, it ought to be worth more. But until you find someone who is willing to pay that much more (in the face of availability at a lower price) it's just not worth it.

What I do have a problem with is Air Canada, being at some of the higher echelons of the industry, can negotiate a pay scale that helps set the climate for everyone. That negotiation is also based on supply and demand, the "value" of something. Their gain comes out of corporate profits (or, possibly from productivity gains etc). and unless they can bargain freely with management about how much management takes for bonuses, the market for labour is being artificially affected by external interference.

[Gannet167]

The ATPL should be a sacred guild, into which membership is difficult and restricted. This would decrease supply and therefore drive up the value of pilot labour.

Even if a company can afford to pay its employees better, it doesn't have to AND SHOULDNT (necessarily). Corporations like airlines don't exist to fly you around, as an employment scheme for pilots, or to celebrate the glory of aviation. They exist for one reason only: to make MONEY.

Money they spend on any item that doesn't have some sort of return on investment is money wasted. As a shareholder in a company, any extra cash spent better do something for the bottom line or it's a waste and will drive down share value. Why pay pilots more than you can hire them for on the open market (or the best deal you can drive with their union)??? It just means less profit, meaning less money to issue dividends, less money to pay down debt, less money for expansion, less money for modernizing, less cash reserves for when hard times hit, and all of that means a lower share value, which defeats the whole purpose of being in business.

It also leaves you vulnerable to going out of business or being taken over by competition. Also, companies in an industry are evaluated against one another. So if airline A pays it's pilots higher it means higher costs, higher ticket prices, lower sales and overall their financial performance is theoretically worse than airline B, so they basically suck in investors eyes and will have a tough time staying in business when no one buys shares and their bond rating drops.

Now some companies generally do better because they have happy, fulfilled, loyal, productive employees that make a difference in the company's productivity and thus the overall bottom line In some cases, paying people better makes facilitates this (a "return on investment") and therefore is worth it. That's hard to qualify in aviation.

[Legacy]

I for one don't necessarily believe in the market value and pilot wage crap either. Its a lack of stricture in the industry is what it is.
Take dentists for example. There is a minimum fee to pay for a root canal. Sure dentists can charge more but their fee structure stipulates it is a minimum $$ for a root canal. Market value? Not one bit. Its a professional organization stating "If you don't like it, enjoy your pain". One year, but probably not in my lifetime, pilots will have a fee structure but don't count on it.

[BTyyj]

Doctors, dentist, engineers, lawyers, and many other professions make as much as they do because they are a valued commodity. They do this by artificially lessening the number of people who can perform these jobs, by weeding out those who are felt to be less suited. You may not agree with this, but way more people can get through medical school than how many are actually accepted into one. This in turn limits the number of doctors available, thus making doctors a more valued commodity (not that they shouldn't be anyways).

Gannet167 is absolutely right. Many other professions, like those mentioned above, have some sort of internship period then write some sort of exam to get accreditation. Why not do this with the ATPL? Or better yet, make a college of sorts which can themselves set the standards and thus make pilot a more valued commodity.

[Cat Driver]

Can someone here tell me what special qualities a person needs to be a pilot, beyond having enough education to read and write and do basic math and pass a pilot medical?

[Brown Bear]

Can someone here tell me what special qualities a person needs to be a pilot, beyond having enough education to read and write and do basic math and pass a pilot medical?

A big problem here, my good Cat, is everybody is still living under the illusion that a "pilot" is a "professional". You can be a pilot with grade 6 Math, grade 4 English and some rudimentary computer skills. Actually, if you're descent at Pac Man, you're pretty much set! Some of the garbage I've seen posted of late, certainly backs up my point.

[Brown Bear]

The ATPL should be a sacred guild, into which membership is difficult and restricted. This would decrease supply and therefore drive up the value of pilot labour.

WTF is a "sacred guild"? You mean a sacred "cow". The Holy "Grail"?
Like that'll happen?
Grade 7! Now that was a bitch! Three years of a pilot's life....wasted!

[Gannet167]

If you'd made it to grade 8, you might have the nomenclature :

guild
noun /gild/ 
gilds, plural; guilds, plural

A medieval association of craftsmen or merchants, often having considerable power

An association of people for mutual aid or the pursuit of a common goal

A group of species that have similar requirements and play a similar role within a community

From Wikipedia:
"A guild (German: Gilde) is an association of craftsmen in a particular trade. The earliest types of guild were formed as confraternities of workers. They were organized in a manner something between a trade union, a cartel, and a secret society. They often depended on grants of letters patent by a monarch or other authority to enforce the flow of trade to their self-employed members, and to retain ownership of tools and the supply of materials. A lasting legacy of traditional guilds are the guildhalls constructed and used as meeting places."



Yeah, one of those.

[robertsailor1]

Actually the way things are going pilot's wages may go down further as it is totally about supply and demand UNLESS you are employed by the Government. If you are you are not facing any market forces and your incomes and gold plated pensions are negociated by your union. If you can get a job with the Government.

[Cat Driver]

There are several problems with the idea of forming any truly cohesive group of commercial pilots.

One of which is they are just to spread out across the country and second is they are so concerned with either getting their first job or moving into bigger equipment they would sodomize a camel to get ahead of the other pilots out there.

It is driven by supply and demand with very little emphasis on quality.

To many commercial pilots......to few jobs.

[Legacy]

Can someone here tell me what special qualities a person needs to be a pilot, beyond having enough education to read and write and do basic math and pass a pilot medical?

A big problem here, my good Cat, is everybody is still living under the illusion that a "pilot" is a "professional". You can be a pilot with grade 6 Math, grade 4 English and some rudimentary computer skills. Actually, if you're descent at Pac Man, you're pretty much set! Some of the garbage I've seen posted of late, certainly backs up my point.

Tell that to the pilots of the AFA 330 that went down. Anyone can be a pilot. Not everyone is an educated pilot. After seeing some doctors in the past, I am suprised you need any education at all to be a doctor.

[Mostly Harmless]

I'm sorry for how this is going to sound as I am in a bit of a mood right now but;

The board of directors, CEO included, the president of your company and all the VP's are all overpaid. They are not overpaid because they are special or rare... they are overpaid because they have no shame when it comes to asking for their wage. They get it because it is the old boys network, not because of their skill level. In fact, those who say you need to pay top dollar to get the best gun have not been reading the business news where the cat is now out of the bag, paying big dollars to bring in the outside hired gun returns below market performance.

Pilots, we are not alone in taking a cut to our lifestyle. It is every industry except the BOD... they are the only ones who have had a raise in pay since the 1980's.... so in that respect, we're not special.

I have a serious problem with your suggested cartel, guild, college or whatever term you want to use. My issue is who gets to say who's in and who's out? How much politics do you think will be involved in that as opposed to actual aptitude for the career? Just look at the Air Canada hiring policy, if your daddy was a pilot, you are too... no, too bad you weren't born into the royal family. Next. What a bunch of selfish children you are.

I was in a flying school recently... looked at the cost of a 172. It was what I paid for my multi rating. Talking to the people there, times are slow. No wonder, if I had to do it over again, I would not be able to afford the entry fee into this race. Now, if one province in particular stopped paying for people's licence's, that would put an end to your supply problem right there... of course, it opens the door to all sorts of other issues you are not even beginning to think about. Flying being the rich kids game... the kid who never worked a hard day in his life, in a market with limited labour... watch the whining and bitching then.

To all of you who feel we are overpaid, you are either fools or you run small charter companies. If you run small companies, I know that the margins are tight and that you are not making fortunes but, stop endorsing the cheapest rates in the world... the helicopter guys have figured this out, why can't we. Here's the price to run a Navajo... if you don't like it go down the street where the price of a Navajo is the same because it costs them the same to run the plane that it costs us. Getting a low-ball contract helps no one. Not the owners, not the pilots.

For those who think pilots are monkeys, stop trolling or get some self esteem. Perhaps you should go work in fields outside of aviation for just a small while to see just how mind numbing your average office job, factory job or service job is, then come back and tell me I don't come out well above that skill level. Am I a doctor, well... a lot of marginal doctors that don't know much out there and some that are so far above me in knowledge and skill set that I would not want to compare... it would put me at the level of service industry to pilot to compare me to a surgeon.

To read your comments about comparing bus drivers to pilots and following it up with talk of restricted numbers is like reading a communist manifesto. Everyone is paid the same and you can work at whatever job we tell you is okay.

Mostly what is bugging me here is a major problem with society. Since when did people become commodities again? I thought we had outlawed slavery once already. These are people you are talking about. Human beings. Not parts in a warehouse somewhere.... what has gone wrong with all of you? Don't blame it on the "this is the way of business/the world arguments!" Business and the world are the way they are because we have allowed it to be that way! Try having some humanity and empathy.

No human should make what current CEO's do while others are starving in the streets. Anyone who can work like that, anyone who can lay off thousands of workers and pay themselves a 10 million dollar bonus for doing it is a psychopath and we should be routing these people out of society, not rewarding them.

Try something new, try being decent to each other. It's amazing how far a little charity goes, and I mean both sides... management and employees. You know who I respect... the founders of Ben and Jerry's who have it written into their corporate rules that the highest paid employee makes no more than 6 times the lowest paid employee. The number is a bit arbitrary, but it shows they have ethics... something that just plain goes missing from a commodity discussion.

[TG]

The ATPL should be a sacred guild, into which membership is difficult and restricted. This would decrease supply and therefore drive up the value of pilot labour.

Did you tried to pass the JAA exams in Europe ? It's almost like getting a degree.
And then try to get a flying job over there, without having to pay for your (Airbus/Boeing) ratings on top of it.
It won't stop the supply unless someone physically restrict the numbers from the start. Now go and tell this to flying schools



Cat & Colonel Sanders have it right.

[BTyyj]

Mostly harmless - Great post.

Cat Driver and Brown Bear - Disparaging the profession isn't helping pilot pay. Cat Driver, not to be rude as you have given me some useful advise, but you seem to argue repeatedly that low time pilots are underpaid, yet you keep bringing up the fact that someone only needs basic skills to be a pilot, similar to what is required to become a janitor. These arguments are completely contradicting.

[Gannet167]

Ben and Jerry's costs $8 for a tiny half liter tub. It's good stuff, no doubt. But you can get 2 litres of regular stuff for $4. B&J is the ice cream equivalent of corporate aviation in a Global Express. It also accounts for a very small market share and almost went out of business.

Costs go up - it's inflation. My grandfather bought a Chevy for $2900 brand new. He was pretty happy with it. The equivalent car today would be $20,000. He also made a fraction of what someone in his position would make today - so what's the point of comparing a 172 today to the rate of a multi-engine years ago?

Those executives likely are overpaid. I should have been one of them. Maybe there's still time...

[Brown Bear]

Can someone here tell me what special qualities a person needs to be a pilot, beyond having enough education to read and write and do basic math and pass a pilot medical?

A big problem here, my good Cat, is everybody is still living under the illusion that a "pilot" is a "professional". You can be a pilot with grade 6 Math, grade 4 English and some rudimentary computer skills. Actually, if you're descent at Pac Man, you're pretty much set! Some of the garbage I've seen posted of late, certainly backs up my point.

Tell that to the pilots of the AFA 330 that went down. Anyone can be a pilot. Not everyone is an educated pilot. After seeing some doctors in the past, I am suprised you need any education at all to be a doctor.

Trouble was, the Air france guys were probably NOT very good at Pac Man? They were lacking common sense, in that they couldn't seem to deduce the simple fact that since what they WERE doing wasn't working......it might be time to try something else?....they couldn't see the forest for the trees! This was a problem that would NOT have happened to ANY common sense equipped bush pilot. The fact remains. You CAN be a pilot with the educational requirements I eluded to.

[Cat Driver]

Frosty, yes a large group of pilots are under paid......because they accept it.

Let's look at a sector of aviation that I have some experience in, flight instruction.

The pay that flight instructors in Canada accept is so low that it borders on criminal.

Even if Canada were to grandfather my Canadian instructors rating which I let lapse in 1965 the pay rate that most flight schools offer would not pay my expenses to go to the airport.

As to the qualifications to to become a pilot I stand by my statement.....if you can read and write, pass a medical and have normal motor skills you can become a pilot.......oh and get the money to pay for the training and flying time.

I fail to see where I am demeaning pilots?

[Doc]

I fail to see where I am demeaning pilots?

You're not demeaning pilots.
Pilots are poorly paid because so many are willing to work for peanuts.
They WILL "sodomize" a camel to get ahead.
Proof? They are willing to plop down major sums of money to companies who are willing ti hire them. they are willing to be treated like crap on ramps and docks throughout the country for the "privilege" of working for piss poor wages.
THEN, they refer to themselves as "professionals"......PLEASE!

[BTyyj]

I fail to see where I am demeaning pilots?

Probably the part where you stated your thoughts on the requirements to become a pilot, which is comparable to those of a garbage man. These stated requirements do not represent the present situation. Every single pilot I know in person, who has entered the industry within the last 15 years, has either a degree or a diploma. I am not saying this makes them better pilots, I am just saying that the whole grade 8 education story doesn't hold too much weight anymore. Looking at the hiring section of these forums, it seems most air carriers require at least a high school diploma. If everyone held the mind set that the bare minimums in education are okay, human kind wouldn't progress.