Postal Service Struggles Under Recession

USPS Trucks
USPS Trucks

May 03, 2009
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The Economist magazine shares the following with us…

You’ve got (no) mail

Engraved magnificently above the columns of the main post office in Manhattan is a promise of the postal service’s resilience. “Neither snow nor rain nor heat nor gloom of night”, runs the motto, “stays these couriers from the swift completion of their appointed rounds.” Inclement weather is one thing, but the downturn is posing a greater challenge. Starting on May 9th, New York’s main post office, which prides itself on being open 24 hours a day, will close its overnight window. Other post offices round the country may close down completely.

This recession has been particularly cruel to the postal service, already battered by the popularity of e-mail. Last year saw the biggest decline in mail since the Depression: volume fell by 4.5%, or about 9 billion pieces. The postal service ended the 2008 fiscal year with a $2.8 billion loss, and the next two years may well be worse. “No one knows at what point mail volume will bottom out,” said the postmaster-general, John Potter, in his testimony before the Senate in January. He thinks the service could lose as much as $6 billion in 2010.

Congress has encouraged the postal service, which is an independent agency under the control of the executive branch, not to rely on government money and to function more like a company. It has not given the agency a handout since the early 1980s. So Mr Potter has been trying to cut costs. The country’s third-largest employer, the postal service is reconfiguring delivery routes, reducing work hours and cutting staff through attrition. It is raising rates to try to bring in more revenue, and also planning a summer sale to entice businesses to send mail in bulk at discounted rates. Some of its biggest customers, the housing and financial industries, have sharply reduced their direct-mail budgets because of the recession. The postal service wants to lure them back.

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2 Responses to "Postal Service Struggles Under Recession"

  1. Hello, I happen to work for the postal service and the carriers are out in 100 and more degrees (inside the vans) in the summer and -15 to -20 degrees in the Winter so no they are not like any other min. wage job.

  2. It’s like every other big business. The salaries are outragious. No one should be allowed to make that kind of money for what they do. They don’t work any harder than a person making min. wage. They have over priced themself. It’s time for this country to get real. The average American just can’t afford it anymore.They also should be asked to take a cut just like the auto workers have had to do. And that includes Education too. Most are over paid. In our small town we hired a new principle and had to let 9 teachers go. It’s so wrong. It’s time that these salaries got under control.

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