GAO Report Reveals Declining Air Service in Small U.S. Communities and Implications for Federal Contractors
The Government Accountability Office’s report, Trends in Air Service to Small Communities (GAO-24-106681), provides a comprehensive assessment of how small communities across the contiguous United States have fared in maintaining access to commercial air transportation from 2018 to 2023. The findings reveal a pattern of diminished flight frequency offset by the use of larger aircraft, alongside a steady escalation in airline operating costs and federal subsidies. These trends hold important implications not only for policymakers but also for federal contractors engaged in aviation, infrastructure, and transportation support programs.
The GAO found that total departures from 218 small communities decreased by roughly 14 percent between 2018 and 2023, with an especially steep decline during the onset of the COVID-19 pandemic. Although the number of departures fell, the average number of seats per flight increased by 26 percent, indicating a continued shift by airlines toward larger aircraft. Approximately half of the small communities experienced only modest changes in passenger volumes, while others saw dramatic declines or gains depending on location, access, and economic recovery factors.
A central focus of the report is the federal Essential Air Service (EAS) and Small Community Air Service Development Program (SCASDP)—two mechanisms through which the U.S. Department of Transportation (DOT) subsidizes or incentivizes air service to smaller markets. EAS communities, which receive federal subsidies, were found to lose less service and to gain more seats per departure than non-EAS communities. However, the fiscal impact of sustaining those subsidies has grown sharply. Between 2018 and 2023, EAS subsidies increased approximately 31 percent (from $349 million to $456 million in constant 2023 dollars). The average per-community subsidy rose by one-third, driven by rising labor, fuel, and maintenance costs, as well as the transition from smaller turboprops to 30-seat regional jets.
The GAO also emphasized the enduring shortage of pilots and aviation maintenance technicians as key constraints on small community air service. Pilot training requirements, high educational costs, and limited training infrastructure continue to reduce the supply of qualified personnel. While regional airlines have raised salaries and offered incentives to attract and retain pilots, these measures have further increased per-seat operating costs. Maintenance labor shortages have also contributed to delays and higher costs across fleets serving small airports.
For federal government contractors, these findings point to a continued expansion of opportunities in technical, operational, and infrastructure support to DOT, FAA, and related programs. Contractors specializing in aviation workforce development, electric and hybrid-aircraft technologies, and regional ground transportation alternatives may find new openings as policymakers examine options such as electric aircraft adoption, alternative ground links to hub airports, and EAS reform to prioritize remote communities.
As the aviation landscape evolves, the intersection between federal subsidy programs, workforce constraints, and technology modernization will demand coordinated contractor support. The GAO’s analysis underscores the federal government’s ongoing reliance on private-sector expertise to maintain critical connectivity for small communities—a role likely to grow in both scope and strategic importance.
Disclaimer:
This blog post is for informational purposes only and does not constitute legal, financial, or professional advice. Readers should review the official GAO-24-106681 report and consult qualified advisors before making business or compliance decisions related to federal programs.