No, my 3 still copes perfectly fine. Will be hanging onto it for at least another year.
Only reasons for upgrading to the Air:
1 You don't have an iPad
2 You still own an iPad 1 or 2
3 You are an iPad collector and want every iPad ever made
4 You're absolutely "have to" "keep up with the Jones'"
5 You accidentally bought an iPad with insufficient storage.
6 You broke your last iPad
7 Someone in your household doesn't have an iPad and can use your iPad
8 Just because you can and can't control your urges
iPad (and everything else Apple) evolution is starting to look a lot like getting Quicken or Microsoft Office updates. Skipping 2 or 3 evolutions doesn't significantly improve function or your user experience and the money is best spent elsewhere.