U.S. Postal Service lost $1.9 billion
"To return the Postal Service to solvency requires a comprehensive approach, which is reflected in our updated Five-Year Business Plan. The plan provides an achievable roadmap to restore financial stability and preserve affordable mail service for the American public.
"The major elements of the plan must be pursued and executed within a short window of opportunity to avoid unsustainable losses and potentially becoming a long-term burden to the American taxpayer," said Postmaster General and CEO Patrick Donahoe.
The Postal Service has already reached its debt limit of $15 billion. It also has defaulted on $11.1 billion due for retiree health benefits in 2012 and also expects to default on an additional $5.6 billion on September 30, 2013. In addition, the Postal Service owes an estimated $17 billion on future workers' compensation claims.
"These obligations of nearly $50 billion and continuing losses highlight the need for immediate legislative reform to give us the latitude to execute on our Five-Year Plan and improve our ability to repay these obligations and return to profitability," said chief financial officer Joe Corbett.
The Postal Service also continues to reduce costs by reducing work hours. In the second quarter, work hours were reduced by approximately 7 million hours, a 2.4 percent reduction compared to the same period last year.
"Even with a 6.2 percent volume increase in Shipping and Packages compared to the same period last year, we were able to reduce these work hours to increase efficiency," Mr. Corbett added.
The number of career employees decreased by approximately 25,000 in the second quarter and by 46,000 in the last year. These reductions have been accomplished primarily through attrition and separation incentives. The Postal Service now has the lowest number of career employees since 1966. ■