The U.S. Postal Service is in very serious financial trouble. It lost almost $2 billion and there is more pain ahead reported 24/7 Wall Street on May 9, 2014. Another in a series of large quarterly loses for the U.S. Postal Service has a lot of people wondering if it will ever completely recover.
The recent net quarterly loss of $1.9 billion for the struggling U.S. Postal Service is the 20th of the past 22 quarters which has had a loss. Friday’s earnings report showed that first-class mail volume has declined by another 4.1 percent. There was a bright spot in the midst of the gloom with about an 8 percent growth in shipping and package services which sent revenues higher by $379 million. Still, on the balance sheet the liabilities of approximately $64 billion for the U.S. Postal Service exceeded its assets by an enormous $42 billion.
As the U.S. Postal Service reported a $1.9 billion loss for the first three months of this year the entity pleaded for reforms for its very troubled financial system reports USA Today. The recent large loss was seen in spite of a 2.3 percent increase in its operating revenue and continued efforts to cut costs. Postal officials have been saying they need new comprehensive legislation that includes more control over its personnel and benefit costs along with more flexibility in pricing and products.
Postmaster General Patrick Donahoe has said in a statement that the postal service has been working diligently to improve its finances by streamlining its network and improving efficiency, reducing operating costs and increasing revenue. However, Patrick has pointed out the post office will still incur annual inflationary cost increases as first-class mail volume continues to decline. Although the U.S. Postal Service is an independent agency which receives no tax dollars for its daily operations, it is nevertheless subject to congressional control. It appears likely if the financial troubles continue for the postal service more and more mailing services will be handled by independent companies across the United States.