Updat: USPS Plans to Cut 9,000 More Jobs

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The U.S. Postal Service plans to cut a total of 20,000 postal jobs to compensate for decreasing revenue, adding to the reported 11,000 staff cuts made during the past two years.

"The jobs that will disappear are roughly equivalent to the total number of postal workers in the state of Tennessee, plus Rhode Island," Postmaster General William J. Henderson told attendees of the National Postal Forum last week in Nashville.

Meanwhile, the Direct Marketing Association is skeptical about whether the staff cut will be enough to combat the "escalating costs and poor productivity gains" of the postal service, said Richard Barton, the DMA's senior vice president of congressional relations, adding that "we welcome any steps that attempt to get costs under control, though we expect that even stronger steps than these will have to be taken."

Indeed, downsizing is only one element of the postal service's continued effort to boost revenue and cut costs. The USPS also must keep U.S. mail affordable, grow the industry and reform the regulatory environment, Henderson said. To help accomplish this, the USPS intends to reduce its expenses by at least $4 billion by 2004.

"The lion's share of these reductions -- some $700 million a year -- will come from dramatic, breakthrough productivity in our processing system," Henderson said. The reductions include machine use, standardized processes, staffing, scheduling and resource management.

Henderson asserted that the mail has not lost its relevance in the Internet age. "Studies by Pitney Bowes say that two-thirds of the e-business companies surveyed believe that mail is the best medium for developing long-term customer relationships. Seven out of 10 use direct mail to promote their Web sites and to attract new customers," he said.

The USPS will continue to add new Web-based services such as electronic postmarks, bill presentment and payment, and electronic mailboxes to generate revenue for the postal service and enhance the mail industry.

Regulatory reform is critical to enable the postal service to compete fairly with private postal providers of products and services and meet customers needs, Henderson said. "H.R. 22 is a balanced approach to postal reform. We support it ... but we remain open to a dialogue with our unions about this and other ways that we can create incentives for employee innovation and breakthrough productivity without breaking the bank," he said.

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