The U.S. Postal Service announced it will close or consolidate 223 processing plants starting in late May or June, affecting 35,000 jobs.
Postal officials said Thursday that consolidating processing plants would save $2.1 billion and is part of the agency's broader effort to save $20 billion during the next three years, CNNMoney reported.
The postal service announced in December it planned to consolidate or close mail processing centers and cut tens of thousands of jobs. It reported losing $5.1 billion during the fiscal year that ended in September.
The postal service is in debt because of declining mail volumes and a congressional mandate to pre-fund retirement healthcare benefits.
USPS officials said not all affected workers would lose their jobs, with many being offered positions at other processing plants and some being urged to retire.
"This is an important part of the network consolidation," Postmaster General Patrick Donahoe said in an interview with CNNMoney. "Some employees will retire. A mail clerk may want to become a letter carrier. … We know how to move people and find landing spots."
The USPS can't close any facilities until May 15, when a moratorium on closures expires.
The postal service also is considering cutting Saturday service, delaying delivery of some first-class mail, closing post offices and raising the cost of a first-class stamp to 50 cents.