Reduced Mail Volume Forces USPS Downsizing

May 18, 2012 Updated: October 1, 2015
U.S. postal worker
U.S. postal worker Tin Aung moves boxes of letters and cards at the U.S. Post Office sort center in San Francisco, Calif., in 2008. The USPS's most recent consolidation plan begins with closing 48 processing centers this summer. (Justin Sullivan/Getty Images)

The U.S. Postal Service announced Thursday that it will consolidate 48 mail processing centers across the country starting in July—the first part of the agency’s cost-saving plan for climbing out of debt.

“As a result, nearly all consolidating activities in 2012 will occur in August and then will resume again the early part of next year,” Megan Brennan, the CEO of the Postal Service, said in a statement.

Postmaster Patrick Donahoe said the agency needs to shrink in size due to the smaller mail volume in recent years that has given way to email and other forms of communication.

In nine months, the move to close down mail centers would save USPS around $1.2 billion, the agency said.

“We simply do not have the mail volumes to justify the size and capacity of our current mail processing network,” Donahoe said, citing projections that the USPS will lose around $14 billion in the 2012 fiscal year. “To return to long-term profitability and financial stability while keeping mail affordable, we must match our network to the anticipated workload.”

The agency hinted that it needs to start consolidating processing facilities because of the deadlock in Congress, which is preventing passage of legislation to aid it.

After the initial 48 are closed this year, another 92 processing centers are scheduled for consolidation in February 2013. The year after that, 89 more would be consolidated.

The move to consolidate will force the USPS to cut around 13,000 jobs, mostly through attrition.

“The Postal Service will be communicating with our customers and employees about these changes in great detail,” Brennan said. “We will work closely with our customers to ensure there are no surprises as we move forward.”

In the next week, around 5,000 USPS employees will receive notifications related to the consolidation efforts and other activities related to the plan.

With the new plan, approximately 80 percent of the United States that gets first-class overnight mail service will continue to receive it until the end of 2013.

“We are essentially preserving overnight delivery for first-class mail through the end of 2013, although we are collapsing the distance that we can provide overnight service to the distribution area served by a particular mail processing facility,” Brennan said.

In the past, the agency has said it wants to reduce its workforce from around 570,000 to around 420,000, reduce the six-day delivery schedule to five days, and shrink employee benefits.

Recently, the Postal Service’s controversial plan to close down rural post offices drew the ire from local residents who use their services. Initially, as many as 3,700 post offices would have been closed but the plan is now being reviewed by the agency, which said it would save costs by reducing operating hours.

A number of U.S. senators urged the Postal Service to keep rural offices open until further Congressional action.

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