Canada’s postal service will scrap door-to-door mail delivery over the next five years and cut as many as 8,000 jobs to offset declining mail volume.
The Ottawa-based agency is also raising the price of stamps by as much as 59 percent next year, Canada Post said Wednesday in a statement that outlined steps to save between C$700 million ($660.8 million) and C$900 million ($849.7 million) a year.
“With the increasing use of digital communication and the historic decline of lettermail volumes, Canada Post has begun to post significant financial losses,” the postal service said in the statement. “If left unchecked, continued losses would soon jeopardize its financial self-sufficiency and become a significant burden on taxpayers.”
Canada is joining countries such as the U.S. and U.K. in attempting to cut the cost of government-run postal services amid declining volumes of letter mail. An April report by the Conference Board of Canada estimated the agency will lose nearly C$1 billion ($944 million) annually by 2020 unless it makes changes.
Rather than delivering mail directly to individual households, Canada Post will utilize so-called community mailboxes, impacting about a third of Canadian households. Canada Post said the change won’t affect households using rural mailboxes.
The Canadian government supports Canada Post’s efforts to operate on a “self-sustaining basis,” said Transport Minister Lisa Raitt, to whom the agency reports. “In today’s digital age, Canadians are sending less mail than ever,” she said in a statement.
Canada Post will cut between 6,000 and 8,000 jobs, or almost 12 percent of its staff, mainly through attrition. The agency will return to “financial sustainability” by 2019, it said. Canada Post employed about 68,000 people at the end of last year, the agency said in a financial report for the three months ended Sept. 28.
Starting March 31, the cost of stamps will rise to 85 cents each for a booklet. An individual stamp will cost C$1, up 59 percent from the current price of 63 cents.