USPS signs agreement with DOGE, agrees to cut 10,000 workers: ‘Broken business model’

U.S. Postmaster General Louis DeJoy informed members of Congress on Thursday he has signed an agreement with the General Services Administration and Elon Musk’s Department of Government Efficiency to cut 10,000 workers and billions of dollars from the U.S. Postal Service budget. 

In a letter to Congress, DeJoy lamented that the Postal Service has a “broken business model that was not financially sustainable without critically necessary and core change.” 

“Fixing a broken organization that had experienced close to $100 billion in losses and was projected to lose another $200 billion, without a bankruptcy proceeding, is a daunting task,” DeJoy wrote. “Fixing a heavily legislated and overly regulated organization as massive, important, cherished, misunderstood and debated as the United States Postal Service, with such a broken business model, is even more difficult.” 

DOGE will assist USPS with addressing “big problems” at the $78 billion-a-year agency, which has sometimes struggled in recent years to stay afloat. The agreement aims to help the Postal Service identify and achieve “further efficiencies.”

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Postmaster General Louis DeJoy testifies before a House Oversight and Reform Committee hearing on the Postal Service on Capitol Hill, Monday, Aug. 24, 2020, in Washington. (Tom Brenner/Pool via AP)

USPS listed such issues as mismanagement of the agency’s retirement assets and Workers’ Compensation Program, as well as an array of regulatory requirements that the letter described as “restricting normal business practice.”

“This is an effort aligned with our efforts, as while we have accomplished a great deal, there is much more to be done,” DeJoy wrote.

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Critics of the agreement fear negative effects of the cuts will be felt across America. Democratic U.S. Rep. Gerald Connolly, of Virginia, who was sent the letter, said turning over the Postal Service to DOGE would result in it being undermined and privatized.

Ranking member Rep. Gerald Connolly, D-Va., delivers opening remarks during a House Oversight and Government Reform Committee hearing on sanctuary cities’ policies at the U.S. Capitol on March 5, 2025, in Washington, D.C.  (Kayla Bartkowski/Getty Images)

“The only thing worse for the Postal Service than DeJoy’s ‘Delivering for America’ plan is turning the service over to Elon Musk and DOGE so they can undermine it, privatize it, and then profit off Americans’ loss,” Connolly said in a statement. 

He added: “This capitulation will have catastrophic consequences for all Americans – especially those in rural and hard to reach areas – who rely on the Postal Service every day to deliver mail, medications, ballots, and more. Reliable mail delivery can’t just be reserved for MAGA supporters and Tesla owners.” 

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The National Association of Letter Carriers President Brian L. Renfroe said in a statement in response to Thursday’s letter that they welcome anyone’s help with addressing some of the agency’s biggest problems but stood firmly against any move to privatize the Postal Service.

“Common-sense solutions are what the Postal Service needs, not privatization efforts that will threaten 640,000 postal employees’ jobs, 7.9 million jobs tied to our work, and the universal service every American relies on daily,” he said.

USPS currently employs about 640,000 workers tasked with making deliveries, from inner cities to rural areas and even far-flung islands.

Elon Musk met with members of the Senate DOGE caucus at the White House. (Getty Images)

The service plans to cut 10,000 employees in the next 30 days through a voluntary early-retirement program, according to the letter.

The agency previously announced plans to cut its operating costs by more than $3.5 billion annually. And this isn’t the first time thousands of employees have been cut. In 2021, the agency cut 30,000 workers.

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As the service, which has operated as an independent entity since 1970, has struggled to balance the books with the decline of first-class mail, it has fought calls from President Donald Trump and others that it be privatized. 

Last month, Trump said he may put USPS under the control of the Department of Commerce in what would be an executive branch takeover.

Fox News Digital’s Jessica Sonkin and The Associated Press contributed to this report.