The U.S. Postal Service plans to stop delivering mail other than packages on Saturdays, beginning in August, the public corporation announced on Wednesday. It says
the move will save roughly $2 billion a year.
The decision follows repeated warnings that financial woes might force the organization to begin cutting back services. The USPS had previously asked for permission to cut Saturday delivery from Congress via the Postal Regulatory Commission, which oversees the public corporation. Permission was never granted.
In the face of growing competition from email, online banking and package delivery services, the total number of pieces of mail delivered plunged from a peak of 213 billion in 2006 to 160 billion in 2012, a 25% decline. Total revenues fell from $75 billion in 2008 to $65 billion in 2012. The USPS recorded losses of $8.5 billion in 2010, $5.1 billion in 2011, and $15.6 billion in 2012.
National Newspaper Association, which represents community papers, has fought proposed cuts to Saturday delivery before, reports Poynter, since some members time editions to arrive on that
day. About 30% of NNA’s member papers mail a Saturday paper, NAA postal chair Max Heath told Poynter. The loss of Saturday delivery also impacts weekly magazines.
At a press conference, Postmaster General Patrick Donahoe told reporters: “The choice is either changes to some of the services or raise prices, and people don't want prices raised.” He also stated that the change “responds to the financial realities resulting from America's changing mailing habits.”
Wednesday’s announcement met with criticism from the MPA-The Association of Magazine Media. The MPA stated, in part: “Like Congress, MPA was taken by surprise by today’s announcement. While we have actively participated in conversations around postal reform, and in particular, five-day delivery, we did not expect the USPS would act unilaterally, without Congressional approval, and we await Washington’s reaction and more details.”
Previously, the MPA said it may be willing to support five-day delivery as long as the “resultant cost savings… were part of a comprehensive package of long-term
reforms that would ensure a viable postal system for the foreseeable future.”
The beleaguered organization has been swinging the axe to reduce costs at a furious pace: The number of full-time employees tumbled from 752,949 in 2002 to 551,570 in 2011, for a nearly 27% drop in a decade. The number of delivery routes has fallen from 246,500 in 2007 to 228,160 in 2011.
However, according to the USPS, a large part of its financial woes are due to an onerous law passed by Congress in 2006, which forces the organization to fund its future retiree health benefits at $5.5 billion per year. The USPS defaulted on two payments in 2012.