The U.S. Postal Service is implementing drastic changes to cut costs while struggling to meet delivery standards across the country. Louis DeJoy’s controversial modernization plan faces mounting opposition from lawmakers and unions as thousands of postal jobs are on the chopping block.
At a glance:
• USPS has paused plans to move mail processing operations at facilities across the country until January 2025
• The Postal Service has cut 50 million work hours and terminated 30,000 workers since 2021, with 10,000 more layoffs expected
• USPS reported a massive $9.5 billion net loss for fiscal year 2024 despite cost-cutting efforts
• First-class mail delivery performance dropped from 91% to 84% on-time in the second quarter of fiscal 2024
• Postmaster General DeJoy has partnered with Elon Musk’s Department of Government Efficiency (DOGE), raising privatization concerns
Major Workforce Cuts as USPS Partners with DOGE
The United States Postal Service is slashing jobs and cutting work hours as part of Postmaster General Louis DeJoy’s controversial “Delivering for America” 10-year plan. USPS has already terminated 30,000 workers since fiscal year 2021 and plans to cut approximately 10,000 more positions through voluntary buyouts.
The postal service has saved $2.5 billion annually by eliminating 50 million work hours, closing facilities, and increasing productivity. This aggressive cost-cutting approach comes as USPS reported a staggering $9.5 billion net loss for fiscal year 2024.
DeJoy has now signed an agreement with Elon Musk’s Department of Government Efficiency (DOGE) and the General Services Administration to identify additional cost-saving opportunities. The partnership has raised alarms among postal worker unions after Musk suggested privatizing the postal service, a proposal strongly opposed by the National Association of Letter Carriers.
Service Deterioration Prompts Congressional Intervention
USPS is facing criticism for failing to meet service expectations in key markets including Atlanta, Houston, and Richmond, where new mail processing hubs have opened. The agency delivered only about 84% of first-class mail on time in the second quarter of fiscal 2024, a significant drop from nearly 91% the previous year.
DeJoy Blames Congress While Pursuing Controversial Reforms
The Postmaster General has also been vocal in his criticism of congressional oversight, claiming lawmakers have impeded necessary changes. “For decades—and most specifically during the last three years—Congress has actively resisted operational solutions and meaningful change,” DeJoy stated.
USPS has attracted additional controversy for raising postage rates, which critics say contributed to a significant drop in mail volume and worsened financial losses. Several senators noted that “Instead of connecting the two issues, USPS blamed inflation, despite mail prices nearly doubling inflation in that time period.”
The paused facility changes would have included capital investments of $430 million with expected annual savings between $133-177 million. Despite the temporary halt, DeJoy remains committed to transforming facilities into Local Processing Centers, though he claims this will be done without closing facilities or laying off career employees.
