Lehigh Valley Business began investigating the matter after receiving word that parcel delivery firms such as FedEx and UPS were ramping up their local presence in anticipation of Postal Service cutbacks.

The record net loss of $15.9 billion covered the fiscal year from Oct.1, 2011 to Sept. 30, 2012. The loss included expenses of $11.1 billion related to two payments to pre-fund retiree health benefits. As a result, the postal service had to default on these payments.

"We are providing business as usual," said Ray Daiutolo Sr., regional spokesman for the USPS and its Eastern Pennsylvania region.

"We are expecting the holiday season to provide with a little more volume than last year."

Daiutolo told Lehigh Valley Business that the postal service is projecting it will handle some 18 billion cards, letters, packages and other mailing pieces between Thanksgiving and New Year's Eve this holiday season, which is a number higher than last year.

He said the postal service estimates that it could deliver 365 million packages during the holiday season, a 20 percent increase over 2011.

"That's tied to the increase and popularity of online shopping," said Daiutolo.

First class mail had traditionally been the greatest revenue producer for the USPS, but the volume for this type of mail has been on the decline since 2007, he added.

Since Eastern Pennsylvania is connected to the large Philadelphia market, the postal service is trying to leverage its package-delivery service there.

One way the postal service is trying to increase business and keep customers is by adding "village post offices" in various establishments.

"We continue to extend our relationships with third party retailers," said Daiutolo.

Examples include contract postal units at the Emmaus Avenue Laundromat and Minuteman Press at Palmer Town Square in Palmer Township. These businesses allow customers access to typical postal services – but with extended hours.

In an effort to boost revenue, the postal service is reducing post office hours which vary according to location and consolidating redundant operations at some processing facilities.

Daiutolo stressed that no post offices would be closing in the Lehigh Valley.

He also noted that the postal service has established more of a collaborative relationship with UPS and FedEx. In fact, he said these agencies sometimes bring parcels and packages to the post office for delivery.

"Commercially, we have contracts with UPS and FedEx for air travel… that's one of the bright spots," said Dave Partenheimer, national spokesman for the USPS. "We are continuing to see strong growth on the packaging industry. We think there's always going to be a need for hard copy mail."

While hard copy mail may be a decreasing part of the postal service, it retains its value with businesses because hard copy advertising and mailers are effective. Thanks to the November election, the postal service also saw a huge uptick in revenue from political mailings.

Partenheimer said that in addition to expanding its smartphone applications, increasing its online services, adding more village post offices, and adjusting post office hours to correspond with the business they do get, the postal service is working to return to long-term stability. However, it needs Congress to pass legislation that will help the postal service achieve that goal.

"People have predicted our demise throughout history," said Partenheimer. "But we continue to evolve."