Hydroplane I don't really want to get drawn into this discussion as I have no personal involvement with MK for good or ill, however you make some good points that deserve answers.
Staff wages are really no different from any other trade creditors, because while they may bear with you for some time, eventually they won't want to provide any more free credit and will leave. Staff will often be more forgiving than outside suppliers for a company they see as an otherwise good employer, in the hope it can trade out of trouble - or perhaps because they have nowhere better to move to. It's the old story, if you owe your bank $500 you have a problem. If you owe the bank $500M the bank has a problem!
The problem with survival of the fittest is you never really know how fit the next survivor will be. For example how would the cause of safety be served if an EASA operator was replaced by a cheaper provider from a less reputable part of the world? And jobs of course, are not so readily available during a recession which isn't good news for any staff who are thrown out into the wild. Many of those will only find other jobs at lower rates, some especially if they are over 55 may not find work at all. We shouldn't be too quick to accept the free market as a good thing!
And lastly you're right about Sterling - with the £ low, fuel (priced in $) is expensive. This can be hedged against by requesting payment from one's own customers in $ but really it's a consequence of the UK's crazy decision not to enter the Euro (which is a whole new argument!!)