Canada Post cuts were ‘inevitable,’ business expert says

Ian Lee from Carleton University says Canada Post will need to lay off thousands of workers to cut back on costs as letter mail continues to decline.

Cuts to Canada Post services were “inevitable,” says one business expert amid news that the carrier will end door-to-door delivery, nationwide.

“The post office has been in long-term decline since 2006, when letters peaked in Canada,” Carleton University business professor Ian Lee told CTV Your Morning in an interview Friday. “Ever since, it’s been going downhill like a ski slope.”

Federal cabinet minister Joël Lightbound announced Thursday that the government would instruct Canada Post to transition four million addresses from doorstep delivery to centralized community mailboxes, a policy shift he says will generate “close to $400 million in annual savings.”

Also on the agenda are delivering non-urgent mail by ground, rather than air, and lifting a 30-year moratorium on potentially reclassifying rural post offices.

“Canada Post must return to the government with a plan to modernize and right-size its network,” a Thursday statement from the minister’s office reads.

Lee notes that the declining volume of letter mail has come in spite of a growing population, but he also says the reason why isn’t obscure.

“It’s called a smartphone,” Lee said. “Young people, and most people, don’t write letters. You don’t write your mother or father a letter; you send them a text, you send them an email.”

But that falling demand hasn’t been met with downsized costs, he notes, nor has there been significant growth in parcel deliveries, even with the rise of online shopping.

“They’re hemorrhaging cash.”

Postal workers back on strike

Thursday’s planned service changes sparked an immediate response from the Canadian Union of Postal Workers (CUPW), which announced it would resume the nationwide strike that began last year.

“This slapdash approach without full public consultation is an insult to the public and to postal workers,” union president Jan Simpson wrote.

“We cannot accept this attack on good jobs and public services. Let’s now turn our efforts to making sure the Government and Canada Post hear us loud and clear. We have done it before. We will do it again.”

Simpson warned that the announced cuts risk “major job losses,” and Lee agrees.

“If you’re talking about reducing costs ... you’re talking about reducing headcount,” he said. “They’re going to have to lay off, eventually, thousands and thousands of workers.”

Meanwhile, Canada Post has expressed its support for the minister’s changes, writing in a Thursday release that they will enable it to “chart a strong, financially stable path forward” amid changing customer needs.

“We take this responsibility seriously and will work closely with the government and our employees to move with urgency and implement the necessary changes in a thoughtful manner,” said CEO Doug Ettinger.

Following news of the strike, the carrier confirmed that it would halt operations indefinitely.

Rural communities to bear the brunt: Lee

Carleton’s Lee notes that though Canadians living in cities largely no longer rely on their local post office, those elsewhere in the country are more likely to feel the absence of Canada Post services.

“It’s in the rural communities, the hamlets and the villages ... they are completely dependent on the post office,” he told CTV.

He predicts future restructuring will prioritize rural Canadians, where private courier companies and other alternatives are less available.