From the NY Times:

At the same time, decades of contractual promises made to unionized workers, including no-layoff clauses, are increasing the post office’s costs. Labor represents 80 percent of the agency’s expenses, compared with 53 percent at United Parcel Service and 32 percent at FedEx, its two biggest private competitors. Postal workers also receive more generous health benefits than most other federal employees.

In case you didn’t know, this has been long coming.  The Post Office has been on the edge for years now.  And with the rough economy pushing people and businesses to tighten their belts, this was inevitable.  It only makes sense for businesses and individuals to condense/consolidate/eliminate unnecessary physical mail.

Also, it’s really about time the USPS catch up with the times.  Many countries around the world have incorporated, or 100% privatized their Postal Services with great success.  Germany being one, whose postal service turend from facing massive layoffs and big deficits, to developing a broader range of services like logistics and even banking. The simple point of fact is the elephant in the room that is consistent with all federal agencies in the U.S. –  They make too much damned money.