The U.S. Postal Service said it will rely on information technology initiatives and new data systems in the coming year to offset rising fuel costs and to comply with new business requirements demanded by the Postal Act of 2006.
IT systems will play a large role in many of the agency’s plans to shave about $1 billion off its costs this year — and for each of the next three years, according to an update to USPS’ Transformation Plan for 2006-2010. One-third of the projected savings will come from enhanced systems and the rest from process improvements, many of which also have IT at their core.
Labor costs represent 79 percent of USPS' operating costs, the plan states, and the agency “is redoubling efforts to anticipate and match workload with the most efficient staffing.”
However, William Burrus, president of the American Postal Workers Union (APWU), said that figure is misleading because it includes managers and agency executives, who have higher salaries than most union employees. APWU is the largest union, with affiliated employees’ salaries representing about 20 percent of total USPS expenditures and about 300,000 employees.
Workers belonging to unions account for a little more than 50 percent of the agency’s costs, Burrus said.
USPS released the strategy last month as an update to its transformation plan, originally published in 2005, before the 2006 Postal Act passed. The agency is working to meet new management and price rules laid out in the 2006 legislation.
Burrus said he plans to meet with the postmaster general soon to discuss the agency’s short-, mid- and long-term plans to meet the act’s requirements. He said he understands that USPS needs to cut costs, but is worried it is not focused enough on growing the business as well.
“My concern is that all of their efforts in meeting their business plan appear to revolve around reducing labor costs,” Burrus said.
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