Letter writing has given way to the cheaper, more immediate varieties of electronic communication like e-mail, text, IM and social networks. Combine this with the boom in the commercial package service industry, and the financial implications for the United States Postal service are grim, indeed. According to MSNBC, the USPS lost $8.5 billion in 2009 ($4.7 billion more than in 2008), despite cutting more than 100,000 jobs and reducing service.
Nobody uses the Postal Service when they can use the web
At first the U.S. Postal Service estimates were between $6 billion and $7 billion. This was for 2009. The economic recession has been bad since business mail has been cut down. Also, more and more people rely on electronic communication meaning there isn't as much mail sent or received. This has brought marketing down. There is less money for the Postal Service this way. Hardly any money is made. The USPS is hoping that a postage rate increase is within the future. It also hopes that dropping Saturday service could happen.
Costs get saved more than other organizations
In a statement, USPS CFO Joe Corbett remarked the U.S. Postal Service managed to cut more than $9 billion, mostly by slashing about 105,000 full-time jobs. That is "more than any organization, anywhere," he said, and USPS will continue to focus on "efficiency.". Yet favorable legislation, regulation and labor contracts must follow if the organization is to continue to exist.
The USPS and its unions are all negotiating labor contracts. These negotiations are expected to continue into 2011.
First-class mail being unused
Less people are paying bills through the USPS. Also, people are sending less personal letters and cards as well. There has been much more paperless billing. This has all happened online. In 2010, there had been a 6.6. percent decrease in the amount of first class mail sent. The two years before that it was 8.6 and 4.8 percent. There is obviously a problem considering more than 50 percent of USPS revenue comes from first-class mail.
Paperless billing is great since retailers and creditors will give discounts for it. The USPS will have a problem to face though. Only Congress, read: higher taxes, might be able to help the U.S. Postal Service considering even Netflix has decided to do much less of a movie exchange via mail and more through a streaming service.
Citations
MSNBC
msnbc.msn.com/id/40151593
long, painful death
youtube.com/watch?v=EGG96ma1UQc
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