US Postal Service facing 28,000 job losses

media captionThe US Postal Service's Vice-President, David Williams, says customers are choosing to use faster electronic alternatives

The US Postal Service is shutting more than half its mail-processing centres in a $3bn (£1.9bn) cost-cutting drive expected to shed 28,000 jobs.

Vice-President David Williams told a news conference that the closures were designed to stave off bankruptcy next year.

Out of 461 mail-processing centres across the US, 252 will be shuttered starting from next April.

The move could spell the end for next-day delivery of first-class mail.

At the Postal Service's headquarters in Washington DC, Mr Williams told media that the volume of stamped mail had been steadily declining.

Customers were increasingly using the internet for bill payment and other communication, he said.

From nearly 100 million in 2006, first-class mail volume was down to 78 million and expected to halve by 2020.

The closure of mail processing centres will mean letters must travel further before they can be distributed.

The Postal Service says this means overnight delivery, which has been the norm since 1971, will not be possible except in special cases such as bulk deliveries.

After the closures, it is estimated that most letters will take two to three days for delivery, while periodicals will take two to nine days to reach subscribers.

"Customers are making their choices, and what we are doing is responding to the current market conditions and placing the postal service on a path to allow us to respond to future changes," Mr Williams told reporters.

Under the changes, the Postal Service is also increasing the cost of first-class post by one cent on 22 January.

It faces the prospect of default at the end of this month when the Treasury expects an annual payment of $5.5bn for retiree health benefits.

The cash-strapped agency, which is run without public financing, reported an operating loss of $5.1bn in the last fiscal year.

It is projected to make a record loss of $14.1 billion next year.

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