The U.S. Postal Service, which has been searching for cost-cutting measures since its $2.8 billion loss in fiscal 2008, announced March 20 plans to close six of its 80 district offices. In addition, other positions will be eliminated nationwide and many more will be offered early retirement, resulting in annualized savings of more than $100 million.
The six district offices slated to close are located in: Lake Mary, FL; North Reading, MA; Manchester, NH; Edison, NJ; Erie, PA, and Spokane, WA. These offices house only administrative functions, and will not adversely affect customer service, mail delivery, Post Office operations or ZIP codes. The functions of these six offices will be assumed by 10 district offices within close proximity.
USPS spokesperson Sue Brennan says the six district offices were chosen based on their proximity to other districts that could more easily absorb the additional workload without compromising the delivery, retail and mail processing functions of the USPS. “After a very thorough review of operations, geographic and logistics requirements, they were identified as the locations best able to be eliminated,” Brennan explains. “It will take approximately five months to close down the functions performed in the six district offices, expected to be finalized at the end of August.”
What’s more, administrative staff positions at the district level nationwide will be reduced by 15%. More than 1,400 mail processing supervisor and management positions at nearly 400 facilities around the country also are being eliminated, and nearly 150,000 employees nationwide are being given the opportunity to take an early retirement.
Brennan says the closing of the six district offices impacts more than 500 positions. The 15% staff reduction in the remaining 74 districts equates to approximately 1,400 positions – the latter figure is in addition to the 1,400 processing positions being eliminated.
Currently, Brennan says 162,000 employees are eligible for early retirement, which is being offered to those at least 50 years of age with at least 20 years of service or any age with at least 25 years of service.
For its fiscal year 2008 (Oct. 1, 2007 to Sept. 30, 2008), the USPS reported a net loss of $2.8 billion. Total revenue was $75 billion, unchanged from the previous fiscal year, but expenses totaled $77.8 billion. Mail volume in fiscal year 2008 totaled 202.7 billion pieces, a decline of 9.5 billion pieces, or 4.5%, compared to the previous fiscal year.
In the past year the USPS has: cut 50 million work hours; halted construction of new postal facilities; negotiated an agreement with the National Association of Letter Carriers that adjusts letter carrier routes to reflect diminished volume; frozen salaries of all USPS officers and executives; instituted a nationwide hiring freeze; reduced authorized staffing levels at postal headquarters and area offices by at least 15%; sold unused and under-utilized postal facilities; adjusted Post Office hours to better reflect customer use; and consolidated mail processing operations.