GA’s Difficult Climb Back

A pilot who is also a professor at a major university applies academic rigor to an analysis of the future health of general aviation. The hard numbers make for some stark reading.

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I am a 68 year-old Baby Boomer who got his private certificate in 1975 with the University of Michigan Flyers at the Ann Arbor, Michigan Airport. At that time, the Flyers had five Cessna 150s, a Skyhawk, a Piper Arrow, and a Citabria. Within a few months, a twin was added to the fleet-which continued to grow. There were some 200 University students, and some faculty, involved and most of the Club instructors were students at the U. There was an excitement about aviation.

Every fall, club members taxied one of the Cessna 150s, with a police escort, into the center of Ann Arbor in the middle of the night and displayed it on the “Diag” for a few days to advertise the flying club. Students joined by the dozens. Today the Flyers has five planes and a hundred members. The club is doing well, partially due to its relationship with the U of M aero engineering program. Elsewhere the situation is not so encouraging.

Population Shrinkage

The shrinkage in the private pilot population is real and has been dramatic: There were 357,479 people with private pilot certificates in 1980, the greatest number ever; yet by 2012 that had collapsed by almost half (47.4 percent) to the lowest its been since 1964. The decline was essentially linear over the 1980-2012 years. Between 1960 and 1979 there was an average growth of 11,481 private certificates per year. Between 1980 and 2012, there was a steady average loss of 4,457 per year.

Another way to view the situation is to consider the number of private certificates relative to the prime age group of potential pilots, 18-64 year olds. In 1970 that rate was 267.6 private pilot certificates per 100,000 persons 18-64 years old. By 2012, the rate had deteriorated to a mere 97.3 per 100,000-that’s a whopping 63.4% decline in the age-adjusted rate of private pilot certificates over four decades. In fact, today’s rate is significantly lower than it was in 1960.

Recently I read where some politician was preaching the feel-good line that if only the government would get off the back of aviation, private aviation would flourish. He speculated that the decline in the numbers of pilots was due to governmental over-regulation and bureaucracy. While that position may be the “politically correct” spin in some circles, it is naive and oblivious to the more salient issues that private aviation faces. Such simple-think ignores the importance of history, economics, demography, and cultural change, and how they are interacting to decimate private aviation as we knew it.

Mortality Among World War II Era Pilots.

The downturn in private pilot certificates that started in 1980 was likely initiated when many of the World War II and early Post-World War II era pilots began entering their late 50s and early 60s. That generation of pilots grew up during the Great Depression suffering the stresses of hard times and then a world war, and had lower life expectancy as well as lower survival rates (the percent surviving at a given age) than the more recently born.

Rise of the Boomers and the Allure of Aviation.

The explosion of babies born between 1946 and 1964 had transformative effects on the U.S. Between 1960 and 1980 the percent of the population between 15 and 34 years old grew from 26.1% to over 35%, but has been declining since and is now down to only 27.4 percent, the lowest it has been in 40 years. The abundance of these young Boomers formed much of the foundation for the expansion of private aviation in the 1970s and early 1980s, as did the World War II generation in the 1950s. The Boomers are now our aging pilots and ex-pilots and there is no comparable cohort of young persons to fill their shoes. The decline in the U.S. birthrate has meant that the population is aging and that there are relatively fewer young persons in the demographic pipeline. But it is not simply about numbers alone.

Like almost all my boyhood friends, I was fascinated with airplanes and the fantasy of buzzing around the sky mimicking John Wayne in The High and The Mighty, or leading a flight of B-17s to Berlin as in 12 0’Clock High. We were mesmerized by the 1957 production of the Spirit of St. Louis and inspired by the courage of Charles Lindbergh facing the Atlantic alone. The weekly episodes of Sky King ripping up the western skies in “Songbird” portended the adventures a pilot could expect. Homer Hickham’s West Virginian Rocket Boys weren’t the only Boomers who turned their dreams to rocketry, astronauts, and space travel. Even commercial aviation was a glamorous voyage romanticized by Hollywood and the airlines. That was then.

Although I don’t have the data at hand to prove the point, I’ll bet that the sales of model airplane kits, aviation magazines, the frequency of and attendance at air shows, membership in aviation organizations, or other low-cost indicators of aviation interest have either fallen in absolute numbers over the past four decades, or not kept up with the growth of the population. In short, I argue that younger Americans, by and large, don’t see aviation through the same rose-colored goggles the Boomers did when they were younger. Relatedly, I suspect that the relative lack of Post-Boomer enthusiasm for aviation is matched by their lack of interest in automobiles and car culture-something that was a core interest to many Boomers. Simply put, the interests of today’s younger Americans don’t parallel those of the Boomers when they were younger. Times have changed and there’s no reason to expect the culture that was unique to mid-to-late Twentieth Century will return in the Twenty-first Century.

Economics I: Affordability.

Virtually every time someone asks about the cost of getting a license and owning or renting a plane, after I finish explaining the realistic costs the typical reaction is the incredulous eye-roll and simultaneous jaw drop. To say that aviation is a hard sell would be a monumental understatement, even to those who might have some latent interest.

It is quite reasonable to argue that the most recent 160 h.p. Cessna 172R, at $274,900, is a vastly superior plane to a 1967 Skyhawk which retailed for $12,750. However, that misses the essential question of affordability; in other words, the price of an airplane relative to prevailing incomes. Between 1967 and 1980, the price of a new Cessna Skyhawk averaged 162% of median white household income. In 2012 that $274,900 Skyhawk was 512% of median white household income. While airplane prices have soared, median white household income has grown since 1967 by only 20% in inflation-adjusted dollars-the big growth in income has been experienced only by the most affluent 5% whose real income has almost doubled since ’67. If we use the average income for all households rather than just white households, the affordability comparisons are even more striking.

It doesn’t appear this has been lost on general aviation manufacturers: there’s more profit in selling a few very expensive airplanes, made with a significantly smaller workforce, to the very richest and status-conscious persons and corporations than trying to sell many planes to a population with relatively stagnant income. Furthermore, the recent unprecedented and breath-taking hike in the costs of Cessna factory replacement parts would seem to signal an unwillingness to maintain legacy aircraft, or at least supply parts only to the most desperate and well-heeled aircraft owners.

Certainly FAA requirements since 1950 for improved seat belts and shoulder straps, transponders, altitude encoders, ELTs, Part 23 Certification standards, myriad ADs on engines, airframes, and accessories, requirements for flight reviews, etc., and most recently the ADS-B mandate, have all driven up the cost of private aviation. Those requirements have been largely incremental over a long period of time and would seem to be insufficient by themselves to explain the steep increase in aircraft prices since the 1980s. In addition to the FAA other favorite whipping-boys of aviation pundits include engine, avionics, and airframe manufacturers, liability lawyers, the courts, petroleum and insurance companies, and FBOs and repair shops. Clearly all have had a role in the escalating costs of private aviation.

It has been suggested that simplifying Part 23 Certification standards could promote innovation and yield significantly lower costs without reducing safety. Possibly, but it is not known what those changes would be, how airframe, engine, and accessory manufacturers will react, and in any regard, any rule changes are a long way off. Further, even if such changes reduce costs to the manufacturer, where’s the guarantee that those will be passed along to the end user and not remain in-house as additional profit.

Economics II: Competing Expenditures.

Obviously acquiring a pilot’s license and buying or renting an airplane has to compete against all other possible uses of disposable income. Consider just two of the many changes that have impacted that allocation of income: first, many Boomers (perhaps most) worked for employers who offered guaranteed benefit pensions and bore much of the cost of health insurance. That is rarely the case these days. Many (perhaps most) non-Boomers work for companies that don’t offer that traditional pension and comprehensive health care coverage, so they are having to squirrel away money for retirement in 401k’s as well as making more significant contributions to health insurance. Second, the escalating cost of higher education for one’s children can’t be ignored since most state colleges and universities have been forced to shift their revenue stream from state government support to tuition paid by parents. When one is worried about medical costs, retirement, the kids’ education, and other high priority concerns, thoughts of private aviation have all the substance of a wispy pipe dream.

Bottom Line

The halcyon days of general aviation in the 1970’s were the result of historically unique factors coming together: a relatively strong economy with a large share of well-paying jobs and a swell in the percentage of the population of young adults-many of whom came of age in an era when aviation, including military, commercial and private aviation, was adventurous, exciting, romantic, and very cool. Those days are past, and they are not coming back despite political speeches and wishful thinking otherwise. Demographics and economics rule.

Given the very low U.S. birthrate, which is at or below replacement rate, the population will continue to age unless there is a dramatic increase in immigration (most immigrants are younger), and given the widespread hostility toward immigration, it’s hard to see that happening. On the economic side, to increase the affordability of airplanes two things would have to happen simultaneously: (1) airframe, engine, avionics, and accessory manufacturers would have to make large price cuts in their products and services, and (2) prevailing wage levels for a large proportion of working Americans would have to increase to levels significantly higher in real, inflation-adjusted dollars than those of the 1970s in order to compensate for today’s greater share of disposable income going for retirement, health care, and education. And lastly, on the cultural side, there would need to be a transformation causing young persons to change their attitude toward aviation and become as “hooked” as did many of the Baby Boomer generation. It is very difficult to envision, at least to me, those kinds of fundamental changes in demography, economics, and culture taking place, and so what can be said about the future?

  • As the aging Boomer pilot population becomes less able or interested in flying, either because of health or dwindling economic resources in retirement, the number of private pilots will continue to decline, possibly even more steeply over the next ten years. The big “die-off” of the Boomers will begin around 2025, and continue for more than a decade but most will stop flying long before then. One of the less obvious negative impacts of fewer older pilots will be on public interest flying such as animal rescue flights, angel flights, and conservation flights.
  • The current over-supply of used airplanes will expand further, and this trend will be exacerbated when private pilots realize the full costs of implementing the new ADS-B requirement. This will further depress the price of older airplanes although that possibly will make some of them more affordable; however, the continued high cost of operation and ownership may offset any reduction in the cost of acquisition.
  • The EAA and AOPA are adamant about the FAA either dropping or radically modifying the Third Class Medical requirement in a desperate attempt to cling onto their aging Boomer pilot membership. If this happens some pilots will continue to be active, at least in the short term, but the LSA market will be a casualty since one of its selling points was that a pilot could fly without a medical certificate. If the medical requirement disappears, what will be the comparative advantage of LSA’s? It is certainly not their price or utility. Over the longer term, changes in the Third Class Medical will have no significant impact because its cost is negligible-roughly the cost of 15 gallons of av fuel every two years for us older pilots.
  • General and commercial aviation are heavily subsidized by the Federal Government and the airline lobby has argued that GA has not paid its fair share of the costs given the proportion of ATC services GA uses. For the past several years there has been a shortfall in the Aviation and Airways Trust Fund-which is supposed to pay for all FAA activities and is funded by aviation fuel taxes-and Congress has had to appropriate $2-$3 billion to cover the gap between fuel tax revenues and expenditures. Given that there is much public sentiment for a smaller, less expensive Federal government, and pressures from the airline industry for GA to pay more of the FAA bill, user fees will become a reality within ten years, or even possibly a more expensive privatized non-governmental system like Canada has had since 1996.
  • In sum, private aviation has a future but it’s not the return-to-the-1970s and 1980s future that many pilots pine for. There will continue to be a trickle of aviation enthusiasts but outside the relative few who can afford to own and operate a $700,000 single-engine twin-turbo gas guzzler, the rest of private aviation will likely look more like Europe does today with small numbers of persons owing their own older aircraft, others co-owing planes in flying clubs, and a smaller segment of hobbyists that build their own bird. Personally, I feel fortunate to have been part of mid-Twentieth century boom in private aviation. Had I been born more recently, it is unlikely that I would have had that opportunity.

E.M. “Woody” Beck is a semi-retired professor at the Uniiversity of Georgia with 1900 flight hours who currently flies about 100 hours per year in his 1978 Cessna Cardinal. Much of it is public benefit flying with Pilots ‘n Paws animal rescue and SouthWings, a conservation organization.