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Federal Eye
Posted at 05:30 PM ET, 05/10/2011

Postal Service loses $2.2 billion in second quarter

The U.S. Postal Service reported $2.2 billion in losses during its second quarter, continuing several quarters of historic losses amid declining mail volume and financial obligations to prefund worker retirement benefits.

Postal officials said Tuesday that the mail agency is still on course to lose about $7 billion when its fiscal year ends in September.

Revenue in mail deliveries totaled $14 billion in the second quarter, down about $568 million, or 3.9 percent, from the same time last year. Shipping revenues also dropped to about $2.2 billion, a 5 percent drop from 2010.

Year-to-year, total mail volume dropped 3 percent to 41 billion pieces in the second quarter, led by ongoing drops in first class mail.

Postmaster General Patrick R. Donahoe renewed his hope that Congress will act soon to give him more flexibility to set delivery routes and repeal a law requiring USPS to pay about $5.4 billion to prefund future retiree benefits.

“The Postal Service may return to financial stability only through significant changes to the laws that limit flexibility and impose undue financial burdens,” Donahoe said Tuesday in a statement.

Postal officials have long argued that without that law, its losses would be much less significant.

Despite the losses, USPS also cut about 9.6 million work hours; the total postal workforce numbered 571,566 in March, a drop of about 6,700 from the previous year, officials said.

The Postal Service plans to cut about 7,500 administrative and postmaster positions by next spring. So far, about 2,000 staffers have taken buyouts.

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By  |  05:30 PM ET, 05/10/2011

Categories:  Postal Service

 
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