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US Postmaster General Reduces Work Hours to Cut Costs

USPS
US Postmaster General Reduces Work Hours to Cut Costs

Postmaster General Megan Brennan said the USPS reduced over 6 million work hours in the recent quarter, which helped the organization reduce its overall compensation expenses. She made the statement in her most recent video talk to employees published on the USPS website.

Managing employee balance can be a tricky business, as this GovExec.com article from last June highlights – cut too many workers, and overtime can spike.

It can also mean a greater reliance on temporary workers, making retention of such workers an important issue. The USPS Inspector General recently published some advice for postal management on retaining non-career employees, which are defined as follows:

“Non-career employees are temporary workers who don’t receive the same benefits as career employees, and they’re not always guaranteed a set schedule. The Postal Service hires non-career employees not only to supplement its regular workforce, but also to provide greater scheduling flexibility and reduce staffing costs.”

The Office of Inspector General (OIG) said in its report last week that postal management estimated it had saved about $8 billion in labor costs from fiscal years 2016 to 2019 by using non-career employees, and decreased turnover from 42.8 percent in 2016 to 38.5 percent in 2019.

“However, that still exceeded the Postal Service’s 2019 target rate for non-career turnover of 34.08 percent,” the OIG wrote.

“We also found that USPS didn’t measure the cost-savings associated with reducing non-career employee turnover. Moreover, management hasn’t developed a single, national strategic plan for recruiting, hiring, and retaining non-career employees.”

Brennan didn’t address the OIG report in her video address, but she outlined what she said were the core areas needed to restore financial stability to the Postal Service:

  • Pursue opportunities to increase revenue and drive efficiency within our business model
  • PRC (Postal Regulatory Commission) must create a flexible pricing system that reflects the needs of the USPS.
  • Legislation is required to enable changes that grow revenue and reduce our cost base “by mandating some of our expenses that we simply cannot afford.”

She said the USPS Fairness Act, also known as the DeFazio bill, was recently passed by the House of Representatives. Brennan said that ultimate passage of the bill would be positive.

The Federal News Network reported on the bill and wrote, “The USPS Fairness Act, introduced last May by House Transportation and Infrastructure Committee Chair Peter DeFazio (D-Ore.), would undo the pre-funding requirement at the heart of the 2006 Postal Accountability and Enhancement Act that has accelerated the Postal Service’s financial losses.”

But Postmaster General Brennan said passage of the bill would only be a first step. “Most importantly, the bill would not impact the liquidity crisis that we will be facing in the next few years – a crisis that will literally threaten our ability to deliver the mail.” She called on Congress to make legislative changes to allow the Postal Service to transform its business model.

She also outlined strategic financial goals and said, “We are a strategic partner to thousands of companies that use the mail to reach and conduct business with the public. We sustain America’s mailing and shipping industry, and we enable America’s ecommerce economy.

However, she said the USPS faces increased competition in every part of its business, and said rivals are adapting their business models to win last-mile and first-mile package business.

“They’re looking to take away our revenue and our unique role at the American doorstep. We are not going to concede any business. We know we must earn our customers’ business every day.” She went on to explain how the US Postal Service is serving business customers and called on every employee to help formally and informally by being an advocate for postal products and services.

“Service is the key to growing our package business. Small- and mid-sized businesses need consistent package pick-up and on-time delivery to their customers.”

Brennan also reviewed the recent holiday season, when the USPS delivered 13 billion pieces of mail, including 800 million packages. “This reflects the confidence that our largest customers have in us to deliver for them when their volume is at its highest,” she said.

Brennan, also thanked employees for their commitment and dedication and for their service to customers and the American people.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

8 thoughts on “US Postmaster General Reduces Work Hours to Cut Costs”

  1. Our Representative is forming a Post Office Advisory council of which I’ve applied. We have so many issues with the USPS from slow delivery of mail, to missing mail, to mail found in the trash cans. Cutting staff won’t help.
    Maybe the Post office should consider contracting with Amazon for deliveries?

  2. “Non-career employees”

    Lol. That’s what everyone is now. Expendable. When they get their way, ALL employees will be temporary or contract. Say goodbye to unemployment, or any benefits.

    It’s still unfathomable how this company that has more package revenue than ever in history, can’t at least break even year over year. They shouldn’t be looking to cut employees.

    1. This. I read that “retaining non-career employees” line and thought not having a plan was the least of their problems. What is wrong with management in this country?

  3. Need to address the contract with Amazon and some of the other high volume companies.
    Amazon would have at least a $2.00 added to each of their shipping cost and $60/hr, minimum of 3 hour billing for Sunday deliveries.

  4. I thought it would be ebay that would put me out of business but looks like it’ll be the USPS. Just in the last 5 years they’ve raised their rates 50-400%, doubled the rate for large package’s to outrageous increased international shipping. It takes rural carrier’s anywhere from 5-10 years to be permanent, they don’t get hired full time until someone on a route retires or dies. The ladies that delivers and pick up for me work their tails off, they use to get extra help during holidays but that got cut off, poor gals work until 8pm during the holidays, driving box to box using a flash light.

  5. Need to cut these bonuses that these management people who sit behind the desk on their asses … stop cutting clerk hours!!! Cut management pay! SO many of them make 80 grand or more a year plus bonuses sitting on their behind.

    1. That’s how management types these days get their big bonus incentives, by cutting employee hours and benefits. Companies aren’t actually saving any money doing this because it all goes back to the executives and management slimeballs.

      Meanwhile, USPS is a dinosaur that’s running themselves out of business. Cutting workers and hours is only gonna make their services even slower and worse. With their ever-increasing prices, worsening service and slower delivery speeds, and less availablility (many post offices have greatly reduced hours they’re open), customers will just go to UPS, FedEx instead.

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