The postal service on Wednesday reported a quarterly loss of $562 million, despite growth in package delivery, due to continued erosion in the use of first-class mail as well as expensive mandates for its retiree health care obligations.
The agency blamed increases in compensation and benefits costs for the red ink and said it would be unable to make a congressionally mandated payment of $5.7 billion this September for health benefits for future retirees.
The postal Board of Governors said Wednesday it wants to raise the price of a first-class stamp by 3 cents, citing the agency's "precarious financial condition" and the uncertain prospects for postal overhaul legislation in Congress.
The U.S. Postal Service will stop delivering mail on Saturdays but continue to deliver packages six days a week under a plan aimed at saving about $2 billion annually, the financially struggling agency says.