Airbus wary of squeezing out suppliers as tops hiring target

© Reuters. FILE PHOTO: The logo of Airbus is pictured on a flag at the entrance of the Airbus facility in Bouguenais near Nantes, France, November 14, 2022. REUTERS/Stephane Mahe

By Tim Hepher

MUNICH (Reuters) - Airbus, struggling to meet resurgent jet demand in the face of crumbling supply chains and labour shortages, has exceeded this year's hiring targets but is wary of crowding out its own critical suppliers in the race to populate factories.

Airbus recruited "much more" than the 6,000 people required in its initial forecasts this year, Chief Human Resources Officer Thierry Baril told reporters this week.

That includes 100% of its goals for the best-selling A320-family, which generates most of its revenues and cash.

But the European planemaker is also having to monitor the risk of over-hiring at the expense of its own suppliers, which could put even more pressure on a weakened supply chain.

"We have to be careful not to be too present on the market and (we are) protecting our suppliers. We try not to drive the market too much but leave opportunities for our supply chain," Baril told reporters.

"If at the end we are recruiting all the people, and not respecting the supply chain, we are suffering. It's a balance which is not so simple."

The comments on the sidelines of a company event underscore the impact on aerospace of the so-called Great Resignation, which saw accelerated departures during COVID-19 followed by problems in hiring experienced workers back as demand recovered.

European furlough schemes helped Airbus maintain partial production during the pandemic but many smaller players face labour shortages and a steep learning curve for new employees just as the industry is once again facing rising demand.

"First we had the pandemic, and now we are looking at a new shock, this time an upward shock in the way we handle the recovery," another senior aerospace industry executuve said.

Once an emblem of European industry with its hospital-clean production halls and relatively high wages, aerospace is having to compete with newer urban employers and a broad shift in bargaining power towards workers and away from large employers.

Chief Commercial Officer Christian Scherer told reporters this week demand for jets was recovering but noted "very tight labour markets for us and our customers".

The European ASD aerospace and defence industry said this week employment had returned to pre-crisis levels. The industry employed 942,000 people in 30 European nations in 2021.

Even so, many aerospace companies are having to overhaul their straegies for attracting and retaining staff.

"The longer they wait, the more burnout they will create among existing employees, potentially leading to even more attrition," Arpad Szakal, principal consultant at executive search firm Cormis Partners, warned in an article published by Britain's Royal Aeronautical Society.

Baril said Airbus would update hiring targets in January.