service industry culture
Airline closure and business subsidy
Effects of business closures on the service industry culture relate to reduced earnings and requirements to change working environments. Airline hostesses, engineers, and support services are expected to change working patterns and lifestyle, by being encouraged to work from home. Key technologies and infrastructure to facilitate working from home cultures are internet connectivity, availability of transactional income, and managing time and productivity due to disruptions from family. In the United States, the halting of airline operations has an impact on household incomes and the ability to fulfill financial obligations such as a mortgage. As such, a shift in service industry culture in the airline sector could compel individuals to file for chapter 11, with businesses contemplating furloughing employees to eliminate the presence of a going concern.
To limit negative shifts and changes to service industry culture in the airline sector, the government is planning health and financial interventions. Health interventions focus on limiting the loss of expert staff and human capital in the airline industry due to deaths from the Covid-19. Secondly, health interventions include paying off medical costs and expenses incurred by airline staff to reduce the probability of bankruptcy and falling into corporate debt. A third health intervention is requiring specific demographics of airline employees, such as individuals above the age of 50 years, to take voluntary leave in the process of lowering infections and risks of fatalities.
Financial intervention in the airline businesses as a shift in service industry culture is government bailout to struggling airlines. By offering financial assistance to airlines filing for chapter 11, government heaps to secure employment opportunities that would cause financial implications to fired staff. The second form of financial intervention is offering airline employees with cash bailouts from federal stimulus programs, thereby limiting individual susceptibility to corporate debt. Additionally, offering cash bailouts gives individuals the ability to afford medical services during the pandemic and reducing fatality rates.
The service industry culture of airlines in the United States would face economic and financial uncertainties due to the lockdown effects of Covid-19. In the airline industry as a service sector, the Federal Government opted to offer more than $110.0 million freight subsidy to port workers to reduce the loss of incomes due to seasonal unemployment. Lack of demand for port incomes relates to the dependence on exports is offering wages and salaries, indicating the effects of lockdown on basic household incomes.
The service industry culture of airline and global aviation would cause a reduction of 16.0% of demand in oil products to halting of airplane consumption. Due to the lower demand for oil products in the service industry, mining exploits would decline, leading to a further glut in expert services.
Fluctuations in the prices of oil futures and commodities have financial implications on individual salaries and wage rates in the airline industry. First, due to the halting of air and road travel has declined substantially, demand for airline services has reduced, leading to lower sales revenues causing businesses to minimize wages and bonuses of employees. Companies, in turn, furlough employees to reduce fixed overheads and overall costs that reduce the profit margins. Due to lower demand for mining and oil resources, commodity valuations fall due to inhibited economic activities. Vehicles, airlines, and other forms of transport are required to maintain money supply through the demand for oil resources. Secondly, wage rates are on the decline due to a reduction in cabin services in the airline industry, leading to lower individual incomes and disposable incomes.
A decline in the demand for air travel services by the airline industry correlates with reduced money supply, a prerequisite for demand-pull inflation that leads to higher prices of foods and necessities. Labor that is dependent on the airline industry, therefore, becomes unable to afford basic amenities leading to higher debts. Among individuals with mortgage options, falling into administration becomes a form of financial uncertainty hence manifesting an impact on the service sector industry.
Lower demand in more than 17.4 million barrels a week lowers the valuation of oil futures and commodities in local and international markets, correlating with reduced salaries and wage rate due to business stagnation. The current price of oil futures is 67.3% lower, indicating an inability to recover service sectors that are reliant on the airline for demand. Moreover, indications that West Texas Intermediate crude would continue to fall manifests a decline in demands for air travel, leading to air hostesses, pilots, and engineers working from home and lowering the money supply in the economy.
The pandemic in the United States
The rates of infections are on the rise nationally, leading to business closures and seeking residents in major cities to remain indoors. In states such as New York, infection rates higher than 301,420 individuals have placed pressure on the healthcare sector, leading to medical professionals seeking people to attend hospitals for critical and chronic illnesses. In the state of California, clinical officers contend that infections more than 46,160 require the public to prioritize available medical resources for the critically ill, in the process of reducing stresses on the healthcare community.
New York has the leading fatalities in the country, with more than 23,140 confirmed deaths. Projections indicate the potential of mortality rate to rise due to delays in instituting lockdowns to limit the rates of infection. In the short term, researchers project states such as New Jersey to exceed the current fatality amount of 6,440, causing volatilities in household incomes due to increased costs of medical care for individuals without asymptomatic infections. High fatality rates correlate with higher infection rates in states such as California, with more than 1,862 deaths. The pragmatic considerations of the closure of public places are to limit human to human transmission rates, hence flattening the curve and reducing the financial and emotional implications of deaths. As such, seeking residents to show resilience during the public health emergency is managing available incomes to reduce economic effects in the service sectors.
Lack of a viable vaccine to Covid-19 is reducing the ability to prevent further infections. The CDC indicated that more than 21.5 million Americans could contact the diseases, and measures such as social distancing could reduce the rate of spread. The CDC further indicated that fatalities could exceed 130,000, manifesting the severity of infections among vulnerable groups.
Rates of infections with respect to different demographics indicate a higher spreading capacity among children but with lower fatalities. To reduce the rate of infections, screening at airports is mandatory since the diseases cause a spike in body temperature. Individual test to assess infection by the condition is not compulsory but is recommended to prevent vulnerable, affecting groups. Covid-19 may lack matching symptoms leading to the inability to model future fatalities since the current rate of Mortality Rate stands at 3.5%. However, varying models also indicate a crude fatality rate that adopts generalizing flu infections and deaths spiked since the emergence of the virus. The current CFR of 17.4% is sufficient to declare the disease an epidemic and necessitating economic and health forms of interventions.
Males are highly susceptible to the virus due to lifestyle and physiological factors that reduce immunity from Covid-19. Among populations infected with the virus, 60 years olds are constituting the first fatalities due to immunity vulnerabilities that decline as an individual’s age. Furthermore, more than 80% of deaths are elderly, indicating the essence of limiting infections among these age groups. However, medical research is showing that more than 75% of deaths from the epidemic lived with other comorbid illnesses causing a vulnerability in the ability to fight opportunistic infections. Since a higher percentage of fatalities lived with chronic underlying diseases, health and financial intervention are essential during and after the pandemic to offer residents with medical covers and Medicaid.
The U.S. Department of Health and Human Services (HHS) projects a decline in the demand for travel services since the government is in the process of issuing sovereign travel restrictions. After the evacuation of more than 200 Americans from Wuhan, China, airlines as a service sector industry will take a financial blow since governments are halting operations of international transportation.
Self-quarantine requirements by governments and businesses to travel employees and agents affect the ability to gain incomes. Suspending businesses and personal expertise for more than 14 days could cause loss of jobs as a form of changes in service industry culture in the airline sector.
Reduced employee productivity and incomes
The decision by airlines such as Delta, American, and United firms to halt operations could lead to financial implications for the companies and employees. By suspending flights to significant destinations such as mainland China, a reduction in sales and overall revenues from cargo freight could cut employee productivity, leading to lower incomes and annual compensations. In firms that base employee benefits and welfare payments based on sales and scope of revenues, a change of service industry culture could relate with reduced earnings and staff motivation. For instance, halting air travel between the U.S. and China in the first week after the declaration of the disease as an epidemic saw the collapse of hundreds of airlines, translating to thousands of jobless individuals and livelihoods.
An increase in the cost of screening incoming passengers is factored by the airlines, causing an upsurge of fixed costs and financial overheads. Airlines that adopt screening as a long term business initiative could modify approaches to hygiene in the airline industry, causing positive or negative gains in the brand image.
As an individual with a penchant for flying, a shift in air travel culture would see a reduction in prices due to the availability of oil commodities pushing prices down.
An impact on the airline is costs associated with parking Covid-19, since leading European hangers charge as much as $290 hourly leading to airlines formulating measures to reduce fixed costs, including the firing of the redundant employee during the pandemic.