USPS Closings To Lead To Tens Of Thousands Of Job Cuts

Feb 23 (Reuters) - The U.S. Postal Service announced plans on Thursday to close or consolidate 223 mail processing centers and eliminate up to 35,000 jobs as part of its strategy to cut costs by reducing its network of facilities.

The Postal Service has been losing billions of dollars each year as email chips away at mail volumes and as it faces massive annual payments to the federal government.

Postal officials said in September they would study more than 250 of the 461 processing sites for possible consolidation with other facilities as part of a series of cost-cutting steps. They also announced plans to end next-day delivery to cut back on overnight work.

Postmaster General Patrick Donahoe has said the agency needs to reduce $20 billion in annual costs by 2015. Moving processing away from the 223 centers would reduce operating costs by $2.6 billion annually, according to the Postal Service's website.

That includes eliminating as many as 30,000 full-time jobs and 5,000 non-career positions, USPS spokesman Sue Brennan said. The agency has gotten rid of about 140,000 jobs in the last five years, mainly through attrition, but still had about 650,000 workers at the end of 2011, according to its first-quarter financial statement.

None of the facilities would close before mid-May due to a temporary moratorium announced in December that is intended to give Congress time to pass legislation to help overhaul the mail agency.

The Postal Service, which does not receive taxpayer funds, wants Congress to eliminate an annual payment to prefund retiree health benefits and let it end Saturday mail delivery.

The agency also wants to take over its health benefits from the federal government and to close thousands of post offices.

Lawmakers have been deeply divided on whether to allow facility closures, end the prefunding payment and other measures. Some lawmakers have praised the Postal Service for "rightsizing" its network, while others say the planned closings will hurt the agency's business model.

"At a time when the Postal Service is competing against the instantaneous delivery of information from email and the Internet, slowing down mail delivery service will result in less business and less revenue," said Senator Bernie Sanders of Vermont in a statement on Thursday.

Donahoe told lawmakers last week, in a letter announcing the agency's five-year turnaround plan, that failing to take all of its planned cost-cutting actions could lead to annual losses of $18.2 billion by 2015.

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Comments

[delilahpower]

11:30 PM on 03/10/2012

Who goes to the Post Office anyway? I buy stamps, print labels and change addresses online Besides, when I do on the off change venture in one, they employees act like they're doing ME a favor.

[waynelaboy]

10:32 AM on 03/05/2012

ZHEEEE EEEEEEEEMPIRE, ZHEEEEEEE'S CRUUUUUUMBLING, UND FAAAST!!!!!

[Radscal]

04:12 PM on 02/26/2012

Where are all the "Strict Constitutionalist" conservatives on the clearly unconstitutional acts of Congress on this issue? The creation and maintenance of the Post Office is required by the Constitution (Article 1, Section 8, where the duties of Congress are enumerated).

In fact, the Post Office is the first duty listed in the Constitution that Congress is required to provide for the public. Even the military isn't mentioned until later.

And how much does the USPS cost taxpayers?

Nothing. Nada. Zero. Zilch. It has been required by Congress to be self-suffecient for the past 40 years

Meanwhile, Congress grants FedEx and UPS hundreds of billions in subsidies, contracts and tax breaks - including hundreds of millions the USPS is forced to subcontract to them each year!

That's right, the USPS costs taxpayers nothing, but their largest privately-owned competitors cost taxpayers hundreds of billions of dollars! Could it be because FedEx and UPS spend hundreds of millions of dollars on lobbying and "campaign contributions," while the USPS is forbidden from paying one cent towards influencing Congress?

How can Constitutionalists stand by while a corrupt Congress undermines a clearly stated Constitutional requirement?

[othel]

12:12 PM on 02/26/2012

They've ALREADY cut 145,000 jobs in the last 5 years?! And there's still another 35,000 coming!? WOW! How much fat is that?
Too many "out in the boondocks" post offices. Folks not living near a larger post office should get mail only once or twice a week. And rates should be comensurate with cost. And no more free ride for congress - each congressman gets a annual stipend of a couple hundred bucks or so a year for mail.

[msbeal]

12:09 PM on 02/26/2012

Do we really need mail, phone lines and roads every where in America? The really important Americans only need their limos to get from their gated community to their Wall Street offices anyway.

[spinotter11]

12:27 PM on 02/26/2012

Everything can go by internet - no need for paper documents any more. And the packages could be handled by FedEx and UPS.

[msbeal]

11:31 AM on 02/27/2012

Possibly. Someday. As we write, one out of three Americans do not have acess to the internet.

There is a tenent amongst conservative scholars called maximum efficiency. It is the academic basis for much of what they believe. I'm not a hundred percent convinced I'd like a society designed around 100% efficiency, such as an assembly line would be.

For starters you'd most likely find maximum efficiency dictating that 315 million Americans coalesce into ten, twenty, thirty mega cities living in high rises. Indeed housing, shopping and jobs could be built into one super efficient building, not unlike ants around an ant pile.

I'm not saying this would happen tomorrow, but I will propose that eliminating the distributed cost of rural delivery (as it would be with power, roads, services), which isn't the most efficient, is a solid step towards this future world I'm describing.

Do you really want to remove the economic feasibility of rural living from the lives of your children? A society based on maximum capitalistic profits might not be all that great for mankind.

Today it's 'socialized' mail, tomorrow we'll hear discussions about how 'socialized' rural roads and power lines aren't penciling out for our new God, the bottom line.

[msbeal]

12:05 PM on 02/26/2012

The other day I went in to my local post office to send an overnight letter on the other side of my state. They told me their overnight service now takes two days. Ok, I can live with that. Then they told me it would cost over $19.00 to send it!!

I think the conservatives are bound and determined to 'make' the post office into the image they want it to be.

[VikingQuest]

12:25 PM on 02/26/2012

Since when was the post office's image a good one when it comes to service?

[Radscal]

04:36 PM on 02/26/2012

Hmmm. Well, I went to my local PO a few weeks ago, and was offered next-day delivery. I decided not to spend the extra money, and sent it first class. It arrived at its destination (160 miles away) the next day anyway!

And how much would FedEx have charged you for next day delivery? In my job, I sent dozens of envelopes and packages every week, and in my experience, FedEx and UPS cost as much or more than the Post Office.

[msbeal]

11:35 AM on 02/27/2012

I don't know. I don't need to do that every day and I was standing right there and just wanted to get that chore off my back. I live rural so we don't really have a dedicated UPS or FedEx store.

[VikingQuest]

11:37 AM on 02/26/2012

Residential delivery should be Monday, Wednesday and Friday . . . if you need mail on an off day, head to the post office.

I think we can all wait 1 day to receive our junk mail.

[JackTheSkipper]

10:27 AM on 02/26/2012

The loss of USPS will greatly affect the rural population that heavily vote republican. Free market will never server the areas as there is absolutely no profit to be made. These freedom loving patriots will have to drive miles to send in their gun club dues and church donations. In a way I think dismantling the USPS is a good idea. Let these neocons suffer for voting against their own interest.

[Durrrrrr]

10:30 AM on 02/26/2012

"Free market will never server the areas as there is absolutely no profit to be made"

Sheer stupidity. You can easily make money delivering mail to remote locations. But you cannot do it by charging the same as you do to deliver mail from NYC to Boston. Make people that live in the boonies pay for the externalities they impose on the rest of us with higher mail costs.

[JackTheSkipper]

10:43 AM on 02/26/2012

In order to make profit, someone must pay for it. Are the bible thumbing and gun loving patriots willing to pay $50 to send in their gun club due envelop? Because any entities charging less than that price will surely go bankrupt in no time.

[wavygravy]

07:49 AM on 02/26/2012

The leadership in Congress, coupled with out-of-date mentality USPS management has driven them into economic abyss, for which the workers will be made to pay the price. Oddly enough, this is the same scenario that is playing out throughout the various levels of our country. The President will likely take the blame for it all, even though the problems have been there long before his administration. Unfortunately, no one seems to have any solutions to the mess in which we find ourselves. We seem to be in a situation where we are completely unable to make rational decisions.

[blogtucson]

11:33 PM on 02/25/2012

After reading the comments, it is clear that as Americans we are clueless on the real reason the Postal Service is in trouble and until that is addressed Americans cannot be trusted with serious decisions like this.

[tb1947]

01:21 AM on 02/26/2012

Well, why don't you explain to us what the issues are, and why us Americans (TAXPAYERS) can't be trusted with serious decisions. We no longer have the pony express. Do you think that was a bad decision?

[Utopian Sky]

10:59 AM on 02/26/2012

As stated in the article, the REAL reason the postal service is in trouble is the increased use of eMail, combined with the death of printed magazines and catalogs, and competition from commercial package delivery services. It seems the only one who is clueless is you.

[Nightangle]

11:27 PM on 02/25/2012

OF GENERATION [ C ] FOR CONNECTIVITY"

From actuarial perspective, 43,000 direct job loss for 24 months, thousands more of indirect and peripheral jobs thereafter. $12 billion USPS mounting debt accruing every seconds, is not viable and not worth saving a primitive and inefficient operation.

USPS delivery system and internal operations are archaic. Maintenance of 32,000 offices, antediluvian sorting machines, massive pensions, retiree health benefit and Workers Comp Injuries, perks and pay. Net loss 8.5 billion in 2010 and increases yearly. Congress subsidizes USPS for the last 6 years at least $30,000 BILLION, callings its postal officials to revamp USPS operations, raise rates and closing post offices. JUST POSTPONING THE INEVITABLE.

In the age of connectivity and instant gratification where all aspects of humanity become fully dependent on technology in nanoseconds, USPS is no longer a viable connection.

Generation C encompasses not only my generation - Millennial [ under 29 ] , but also Mom and Dad's the Baby Boomers, retirees above 65, my grandparents in their late 80's.

2-3 day USPS delivery is no longer acceptable, voice mail are antiquated. Surfing with 21st Century gadgetry - e-mail, payments on line, texting, face to face connectivity, skypes, 4G, free apps, ipods, androids, tablets . . . . .

Mega stores direct "pick-up"; on-line companies free shipping via more efficient private couriers, companies closed down mail departments. Mail is no longer an efficient medium.

USPS IS TOO PRIMITVE, COSTLY AND IS HEADED TO PASTEUR. RIP.

[Nightangle]

11:46 PM on 02/25/2012

ooops . . . .USPS IS TOO PRIMITVE, COSTLY AND IS HEADED TO PASTURE. RIP.

[K August]

05:31 AM on 02/26/2012

I guess you didn't read the posts below to see WHY the USPS is coming up short.
They actually make a profit each year........it's the forced Pre-Funding for 75 years in ADVANCE of retirees and only 10 years to do it in (for employees not even born yet)
that is causing them trouble.

No business is required to do that and neither could they afford it but some in Congress
think it's better to destroy the USPS (privatize it) than fixing the problem that Congress caused!

[Nightangle]

06:58 AM on 02/26/2012

That post is a mega lie. Period.

[Durrrrrr]

10:33 AM on 02/26/2012

You should do some research on GAAP. If you promise to pay for your employees health insurance premiums after they retire, every year that they work you need to account for an expense equivalent to the NPV of all future benefits accrued by the employee in that year.

The USPS could be left to ignore these liabilities that are accruing today. Then when enough of their employees retire they will be left with a bill they cannot pay and go belly up.

[Alwayspissedoffatsomeone]

10:45 PM on 02/25/2012

Anyone shocked here? A poorly run business will eventually close it's doors. The only thing keeping this one open is the US taxpayers. Why has this company been in the red for so many years? C'mon folks .... you know the reason.

[blogtucson]

11:07 PM on 02/25/2012

Because in 2005 a republican congress forced it to fund it's benefits program for 75 years in a 10 year window. Name another business that could with stand that kind of over-reach.
If allowed to continue - all businesses need to abopt this insane policy. The postal service reamains the most efficient entity in the USA.

[Alwayspissedoffatsomeone]

11:49 PM on 02/25/2012

The most efficient entity that's in the hole every year to the tune of 7 billion which is used in helping to pay union pensions and healthcare for life. Another example of entitlements run a muck.

[Nightangle]

11:34 PM on 02/25/2012

Sir, you make a persuasive argument. Inefficiency, poor management - all these and more [see my post] the USPS is not a viable operation. Fanned and Faved.

[Eagleman]

08:25 PM on 02/25/2012

It is time to privatize and make these lazy bums do some work

[Nightangle]

11:40 PM on 02/25/2012

USPS has thousands of injured personnel and under disability and most never return to work, or if they do, it's on "light duty" but paid the same rate [ disability + % of regular rates).

Besides that, they have the highest rate of pay, employee sick time are at the highest, and gets used to the maximum driving temporary workers and OT for the regular employee.

Not to mention massive healthcare cost, retiree healthcare, and the highest pension rate in the system.

[charles847]

12:47 PM on 02/25/2012

The best way to save the Post Office and the thousands of jobs on the chopping block is for congress to give back the $5 billion the republicans are stealing due to legislation they passed.
By appealing that legislation, the post office would once again start making a profit and could even rehire some of the people they have layed off .JOBS

[thereisonlyoneparty]

02:20 PM on 02/25/2012

False.  Nice try though.

Eliminating pension funding and other required payments are not sufficient to right the ship.

The post office is seeing declining revenues due to loss of postal volume.   Losses are expected to continue for a  very long time.

[charles847]

11:31 AM on 02/26/2012

You need to get the facts straight. Republicans are working to destroy the post office because that is what their big money supporters want. Fedex and USPS cannot do what the Post Office does. DO you know anyone or have a relative who works for the post office? It's all about keeping and creating more jobs and republicans will do whatever they can to make sure it doesn't happen. Destroying the post office and relying on companies like fedex and Ups is their plan. We'll all end up having to deliver our own packages because fedex and ups already charge enormous fees and it willl get worse if the post office closes. WAKE UP

[XTC123]

05:04 PM on 02/25/2012

You are a no nothing, the reason the USPS is losing money is because it has not changed with the times and is govern by numerous agencies and being forced to give a ballon payment to the pension fund of 10 billion dollars. Stop blaming the GOP for a problem both parties created in DC, stop acting like POTUS.

[blogtucson]

11:14 PM on 02/25/2012

Change with the times? The Postal Service reaches EVeRY corner of the country.
Fed Ex, DHL or UPS is not even close. And by a resolution of a republican congress in 2005 (with some dems voting for it too) is forced to fund it's benefit program for 75 years in a 10 year window. If this is acceptable to this country, then require ALL businesses to do the same and see what happens to this country .

[Celeste5793]

09:44 AM on 02/25/2012

Today I heard they are laying off people and cutting saturday delivery and ending next day delivery. I hope that does it and it will be okay after that.