Closing Time: Postal Service May Cut 35,000 Jobs

Feb 23, 2012
Originally published on February 24, 2012 3:50 am

Facing a financial crisis, the United States Postal Service announced that 223 processing facilities have been "found feasible for consolidation, all or in part." Of the 264 processing facilities studied, only 35 are set to remain open.

The closings could result in the loss of 35,000 jobs. USPS has posted a full list of the facilities — which process and sort mail on its way to being delivered — on its website.

The postal service said the changes could help it reduce its operating costs by $20 billion by 2015, making the service profitable once more.

In a statement, the USPS explained the financial picture:

"The Postal Service is in the midst of a financial crisis due to the combined effects of the economic recession, increased use of electronic communications, and an obligation to prefund retiree health benefits. First-Class Mail volume has deteriorated, leading to significant revenue declines, and the obligation to prefund these retiree health benefits on an accelerated basis remains unresolved. To date, legislative proposals to address the financial crisis remain pending, leaving the Postal Service and the mailing industry it supports in an increasingly precarious position."

Update at 3:47 p.m. ET. 35,000 Jobs:

The AP and Reuters are reporting that the closings and consolidations could mean the loss of 35,000 jobs. Reuters adds:

"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."

Update at 3:41 p.m. ET. Six Facilities On Hold:

Last week, Patrick Danahoe, the postmaster general, told Congress that his service also needed to raise the price of first-class stamps by 5 cents in order to reach that $20 billion in savings.

USPS says six facilities "are on hold for further internal study."

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

STEVE INSKEEP, HOST:

Revenues have also been dwindling at the U.S. Postal Service, where another big round of service and job cuts have just been announced.

Yesterday officials said they will close 223 mail processing facilities some time after May.

NPR's Jim Zarroli reports.

JIM ZARROLI, BYLINE: In recent years, the Postal Service has suffered big losses, largely because of the weak economy and the widespread move toward electronic mail among consumers. It lost $3.3 billion during the last quarter of 2011.

Postal officials say they need to cut $20 billion in expenses by 2015. The move announced yesterday will result in the closing or consolidation of a large number of the processing facilities where mail is gathered and sorted. That's expected to slow down mail delivery, but it will also save $2.6 billion in annual operating costs. The move will result in the elimination of some 35,000 jobs - most of them are full-time.

The Postal Service employs about 546,000 people nationwide, down from a peak of 800,000 in 2006. To save money, it's been planning to shut down many smaller post offices across the country. It's also asked Congress for permission to stop delivering mail on Saturdays, and it wants to end a requirement that it pre-fund health benefits for its employees.

Jim Zarroli, NPR News. Transcript provided by NPR, Copyright NPR.