Royal Mail to cut 2,500 jobs by the end of next year as part of sweeping organisational overhaul

Royal Mail has announced plans to cut up to 2,500 jobs by the end of 2027 as part of an organisational review. 

The job cuts, which are expected to hit head office and support roles, come amid a ‘significant transformation’ as Royal Mail implements universal service reform to reflect falling letter volumes. 

Letter volumes have declined by more than 70 per cent since their peak while customer demand for faster and more convenient parcel delivery services continues to grow, it said. 

‘As part of its transformation programme, Royal Mail is simplifying processes and functions across the business and today announced proposals for an organisational review of head office and support functions,’ it said in a statement. 

The ailing postal service insisted the cuts are expected through people leaving and voluntary redundancies, rather than compulsory redundancies. 

Royal Mail’s chief executive Alistair Cochrane said: ‘We have been working hard to reduce costs and simplify processes across all areas of the business as we transform to win in a very competitive market. 

‘These proposed changes remove duplication and allow us to invest further in the service we deliver for our customers.’

He added: ‘We are committed to treating everyone fairly and respectfully throughout this process, working closely with our trade unions. The proposed changes will not be easy, but they are an important part of building a stronger, simpler and future-ready Royal Mail for our customers and colleagues.’

It comes days after Cochrane said he was ‘sorry’ for poor performance as he said that the firm’s ‘biggest transformation in generations’ will reach most areas ‘before Christmas’.

Unions railed against the news and said workers are now being punished for Government and regulator failure to force the company to modernise.

Unite general secretary Sharon Graham said: ‘Unite has been warning for some considerable time that unless the government and Ofcom address the serious challenges facing Royal Mail, further jobs will be put at risk.

‘This is not good for employees or customers. It will not improve quality of service and the workforce must not be made the scapegoats for poor decisions made by the company, government or Ofcom.

‘Without urgent action, this will happen again. More jobs will be lost, employment standards will continue to fall and customers will continue to be let down. The answer cannot simply be another round of job cuts.’

The Communication Workers Union (CWU) urged the Government to ‘confront the reality of a collapsing Royal Mail and intervene to save this national institution’. 

Deputy general secretary Martin Walsh said: ‘Despite the union being reassured that this announcement will not impact any frontline workers, and will involve no compulsory redundancies, these proposals will impact approximately 200 CWU-represented jobs in administration and revenue protection.

‘We will be meeting management to discuss this announcement, which is further evidence of a company that is demoralising staff and failing to deliver for customers and the wider community.’

Royal Mail’s performance figures to June showed ‘encouraging signs’ following a 9 per cent improvement in delivery rates for First Class letters and a 2 per cent improvement to Second Class. 

In the first three months of 2026-27, 85 per cent of First Class letters arrived at their destination within a day, still below regulator Ofcom’s 90 per cent target. Some 91 per cent of Second Class mail was delivered within three days, short of the 95 per cent target.

Royal Mail’s parent company International Distribution Services (IDS) was bought last year by Czech billionaire Daniel Kretinsky.

The postal service is grappling with declining letter volumes – down 10 per cent to 5.7billion last year – as people switch to digital communications and baulk at the soaring price of stamps. 

The UK business saw profits plunge to £96million in the year to the end of March from £198million over the previous 12 months, as the firm felt the effects of higher employment costs.

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