Oman Air Cuts Workforce By Nearly 25% As Part Of Massive Restructuring

Over the past year or so, Omani national carrier Oman Air has been undergoing a major restructuring, as the government owned airline is suddenly trying to stop hemorrhaging money. Clearly turning a profit wasn’t a priority for a long time, but that has changed, with the appointment of a new CEO. We’ve seen the airline shrink considerably, including retiring the A330 fleet, eliminating first class, and introducing an all-economy subfleet. We’re now seeing the next step of this strategy.

Oman Air cuts 1,000 jobs, reduces workforce to 3,300

Gulf News reports that Oman Air has cut around 1,000 jobs, in order to improve efficiency and achieve financial stability. Previously the airline employed 4,300 people, so that brings the new headcount down to 3,300 people.

Of the job cuts, 400 were Omani nationals, with the remainder being foreigners. The reductions also included a voluntary retirement program, which 310 people took advantage of. Other employees have reportedly been offered alternative positions with the same salaries but reduced benefits (it’s not entirely clear what that entails).

Just how inefficient was Oman Air’s workforce before? According to the country’s Minister of Transport, before the restructuring, 45% of employees were non-core, a figure much higher than the regional average. Based on the fleet size and industry benchmarks, the company should have around 2,700 employees, so that’s quite a bloated workforce.

I’m sorry for those who lost their jobs, as that’s never fun, and it’s also not great for morale among those who were able to keep their jobs. This also isn’t an ideal time to be looking for work. Unless these people were just sitting around twiddling their thumbs, I have to imagine that this will have some impact on the carrier’s customer experience.

I’m curious to see how radical Oman Air’s transformation is

Oman Air has historically been a bit of a hidden gem of an airline. The company wasn’t trying to compete with carriers like Emirates or Qatar Airways in terms of scale, but was instead a boutique carrier connecting Muscat to the world. I’ve enjoyed my flights with the airline… well, for the most part.

In most of the world, airlines exist to be able to turn a direct profit (well, or at least try… sometimes they’re not good at it). In some regions, airlines exist as an extension of the government, to provide connectivity, in terms of tourism and trade. In theory, there’s nothing wrong with a government running a money losing airline, as long as everyone is on the same page, and objectives are being achieved.

But of course the catch is that those objectives do change, and sometimes governments say “hold on a second, we don’t want to lose money anymore,” and that poses a challenge.

Oman Air’s new CEO has done a solid job trying to improve the financial performance over the past year. It seems the focus has been on achieving better results through cutting costs, rather than through trying to generate more revenue. We’ve seen aircraft retired, workforce reductions, and more.

But I’m wondering if there’s a next big step for the airline. Oman Air will be joining the oneworld alliance in June 2025, and there’s talk of the airline expanding its fleet in the long run. What that looks like remains to be seen. I’m rooting for Oman Air, and hope the airline can improve its finances without giving up what makes it unique.

Bottom line

Oman Air has just reduced its workforce from 4,300 people to 3,300 people, as part of an effort to improve financial performance and restructure. The country’s Minister of Transport claims that based on the fleet size, the airline should have 2,700 employees. It’s interesting to see what’s going on at Oman Air, and I look forward to the carrier joining oneworld.

What do you make of Oman Air’s restructuring?