February losses exceed $650 million

The US Postal Service announced a monthly loss for February of $658 million, leading to a year-to-date loss of nearly $1.8 billion. At this point last year, the USPS had posted a loss of only $258 million. Various estimates have projected a year end loss of somewhere between $5 and $8 billion.

This staggering loss comes on the heels of the announcement in late March of the USPS's plans to to cut up to 3,000 management jobs throughout the country, and elimination of four of the 80 customer service districts. The service maintains a huge management structure relative to its labor force, and is known for being the most top heavy organization in the country.

Postmaster General John Potter is attempting to save his organization through the reduction of thousands of redundant positions, closing of facilities, filing for additional rate increases, and cutting one day of delivery per week. The elimination of 3,000 management positions is expected to only save $100 million, and will therefore have almost no effect on the bottom line. A rate increase is scheduled for May, but often such increases further depress mail volume.

Many employees consider the action on management positions to be nothing more than a large scale rearrangement of office chairs, as significant new positions will be opened, often at higher pay grades. This has long been the tactic of the Postal Service, and nothing is expected to change. Further, the ratio of supervisors to employees remains considerably higher than what would be acceptable in private industry, as evidenced by surveys at numerous postal facilities.

Headquarters seems to believe it's serious about saving the organization, but until radical policies are implemented, such as former PMG Marvin Runyon's examination of every position that doesn't touch the mail, nothing will change.

Meanwhile, panic is in the air as management employees begin to consider the possibility of losing jobs, or being forced to relocate to other parts of the country, as the RIF approaches this summer.

Next stop: Associate Offices.