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Postmaster General Patrick Donahoe wants to cut 220,000 jobs in four years The US Postal Service has announced radical plans to cut one in five jobs, reduce services and water down staff retirement and healthcare deals as the government agency struggles to keep costs in line with plunging demand. Among proposed cutbacks to services, many of which will require legislative changes, is a plan to reduce mail delivery from six days a week to five. Postmaster General Patrick Donahoe wants to remove 220,000 posts in four years and believes about 120,000 of them will have to be layoffs – pitching him at loggerheads with unions. In an official statement, the US Postal Service (USPS) said: “Our most significant area of cost is in compensation and benefits, and one key driver of those costs is simply the sheer size of our workforce. “Based on current revenue and cost trends, and assuming a move to 5-day delivery, the Postal Service can only afford a total workforce by 2015 of 425,000, which includes approximately 30% lower cost, more flexible, non-career employees.” Donahoe is calling for emergency legislation to remove the USPS from layoff protection agreements it has entered into with unions. He said the postal service would be “insolvent next month” because of sharp declines in the usage of services. In the last four years the USPS said postal volumes had declined 20% while prices remained capped at the rate of inflation. Adding to cost pressures, Congress has insisted the USPS pre-fund its heathcare and retirement plans. Donahoe said the service made a net loss over the period of $20bn(£12.4bn) – a figure disputed by unions. In addition to cutting jobs, Donahoe also wants to withdraw from federal healthcare and retirement plans, replacing them with lower-cost provisions funded by the USPS directly. In response Fredric Rolando, president of the National Association of Letter Carriers, said: “The issues of lay-off protection and health benefits are specifically covered by our contract. Each of them has historically been covered in collective bargaining between NALC and USPS. The Congress of the United States does not engage in contract negotiations with unions and we do not believe they are about to do so.” Donahoe’s proposals were provocatively announced just days before executive and union leaders were due to formally open collective bargaining talks. Rolando accused USPS leaders of trying to use the current financial crisis “to strip postal employees of our bargaining rights”. Developments in the US are being watched by British counterparts, concerned that trends seen in America could be repeated in the UK. Billy Hayes, general secretary of the Communication Workers Union, argued that cutting the US Postal Service by 20% is an alarming move which will devastate services and bring job losses when America is already struggling with economic woes. “It’s a real concern because the USPS, like Royal Mail, has been a gold standard for postal services throughout history. Customers and staff will suffer as a result of severe cuts. “There’s a worrying trend of downgrading postal services worldwide which we hope the UK will not follow. Businesses, consumers and the general public all value the UK’s postal service and we want to see service standards maintained with six-days-a-week deliveries and universal pricing. These were commitments which were secured in the recent Postal Services Act, therefore there should be no question of such reductions in Britain.” US unemployment and employment data US economy United States Postal service Royal Mail Simon Bowers guardian.co.uk