Sunday, March 13, 2011

West Virginia is the Test Case for PMG Donahoe's and Congress's Resolve

The entire West Virginia Congressional Delegation has signed a letter opposing consolidation of processing plants in West Virginia.   The postal service has proposed five area mail processing studies to consolidate mail processing operations in West Virginia affecting the cities of Beckley, Bluefield, Huntington, Martinsburg, and Wheeling.

The primary reason for pressuring the Postal Service to not consolidate these five facilities in West Virginia is the loss of local jobs.  As an editorial in the Bluefield Daily Telegraph notes "If the jobs were to be lost, it would be another crippling blow to Mercer County — particularly given the 164 jobs that were lost last week at Flowers Baking Company. We must fight to keep these 96 postal positions in Bluefield."

As Postal Service pay is set based on national contracts, Postal Service jobs in West Virginia are likely to offer above average salaries for jobs in the towns where the plants under consideration for consolidation are located.   So the loss of the 96  Postal Service jobs is likely to have a bigger economic impact on a community like Bluefield than the loss of 96 of  the 164 jobs lost at Flowers Baking Company.   Making job losses even more difficult is West Virgina 9.6% that above the 8.9% national rate. 

The Problem with West Virginia that makes it a likely target for consolidation for the Postal Service is that its demographics result in relatively low volumes of mail per capita and most likely faster declines in mail volume that other states with households that are more attractive to advertisers and e-commerce retailers.   The demographic factors that work against mail volume in West Virginia that drive the Postal Service's focus on plants in its state are as follows:
  • West Virginia is a mostly rural state that is relatively poor. It has the 44th lowest GDP per capita of any state in the United States, and has one of the lowest ranked states in GDP per capita for decades.   West Virginia is has the 6th highest poverty rate. 
  • West Virginia is a state that also has population that is not growing.   The 1,819,777 estimate of population in 2009 and is 6.7% below the population in 1980 and 9.3% below the state's population peak in 1950.

The five consolidation studies generate a "here we go again" feeling within West Virginia that reflects a history of corporations headquartered outside of the state closing coal mines, manufacturing plants and retailers that has made it difficult for the state to end decades of challenges to growing West Virginia's economy.   It creates the sense that West Virginia is a victim again and is reflected in the editorial of the Bluefield Daily Telegraph that stated that, "The postal service does appear to be unfairly targeting facilities in southern West Virginia, and the Mountain State in general, for consolidation."

However, West Virginia is not alone in having multiple plant consolidation under review and the consolidations announced in West Virginia are similar to those located in most other states.  A cursory look at the list of consolidation studies that the American Postal Workers Union maintains shows that nearly every state is affected.  For example, Wyoming has four plants under review even though its income level is higher and its population is growing faster.

The letter from the West Virginia Congressional delegation raises a central question about the reason the United States has a Postal Service.  Should it operate as a federal jobs program that requires federal assistance to maintain jobs in communities like Bluefield West Virginia or should it be a self-sufficient enterprise that provides a critical part of the nation's economic infrastructure?   The members of the West Virginia delegatin appear to want the Postal Service to operate as a jobs program.   

If Pat Donahoe is to give the Postal Service a chance to have a self sufficient future, then he has to maintain his resolve that plant consolidation is a core strategy for the Postal Service.   He must stand up to the West Virginia Congressional delegation and push through these consolidations as quickly as possible.   Similarly, it is time for members of Congress that believe a self-sufficient Postal Service should be the core of postal policy to support Pat Donahoe's actions to consolidate processing facilities in West Virginia and all other states.


Anonymous said...

Whomever wrote this article is a blubbering idiot !

Anonymous said...

In our modern lifestyles we've acquired, the last thing we need to do is go consolidating a bunch of processing plants. That will make the turn around on getting the mail delivered longer. We are in a speed driven world now, that would be the end of the Postal Service. The answer is to cut tons of management starting at the top. Stop forcing people to work their holidays and just see how much money is saved!

Just looking at these upper management, including Donahue. They could stand to do some "real work" they obviously eat very well, and exercise...well probably not at all. Time to roll up your sleeves and do some real work, or move on. You are dragging the Postal Service down.

Anonymous said...

When the Post Office was started, it was NOT to be a "for profit" organization, but to provide universal service to the entire country, and unite the country. Are Interstate highways also to be "for profit"? How about the airports? Both of those take huge amounts of federal money. The Post Office has been finacially independent of the federal government for many years.

Anonymous said...

So Congress says to cut cost because we are not going to give you your 75-100 billion dollars overpayment, but don't cut cost in my district or my state. Mail will still be processed overnight and return the next day. My mail travel 85 miles one way and is return the next day. And I don't have interstate highways to transport it on

Frank Murphy said...

I work in Charlottesville Va post office. Our plant was consolidated with Richmond Va. and it now takes local mail two-five days to return to Charlottesville. The Postal Service should take the word "Service" out as the upper management is no longer concerned about service to its customers.