Demand in emerging markets could fuel future hiring frenzy

Passenger traffic is expected to grow multiple folds over the next two decades, with significant contributions from emerging markets. To meet this increasing demand, more than 2.27 million new aviation personnel will be needed in the next two decades. These personnel will provide all aviation services, including training and pilot services, digital solutions and analysis, parts and distribution services, and maintenance and overhaul services. In light of these predictions, Jared Ailstock, managing partner of AIP Capital, a global asset management and aviation investment firm, is available on the importance of emerging markets for the aviation market over the next twenty years.

A significant factor contributing to the growth in demand for air travel is the emergence of low-cost carriers in regions such as the Middle East and Africa, as well as sustained global interest in the further development of the Asia – Pacific region. It’s expected that these three regions will comprise 34% of the 2.77 million new personnel needed as the sector continues to grow over the next two decades.

However, with supply bottlenecks and record-high fuel and labour costs still permeating the sector, it’s unclear how legacy airlines will follow these significant increases in air travel demand. Despite having returned to pre-covid capacity earlier in the month, many airlines are struggling to achieve profitability levels exceeding 40% of pre-pandemic records amidst these challenges. Supply chain issues are set to worsen a ‘tug-of-war’ over engines between airplane factories and repair shops, with around 650 jets to sit idle in the first half of 2024. As a result, alternative investment and asset management firms, are addressing the bottlenecks in the supply chain – such as engine repairs – to enable the industry to continue on its growth trajectory.