New Zealand Post will cut up to 2000 jobs over the next three years as part of a restructure which will cut urban mail deliveries to three days a week.
New Zealand Post chairman Sir Michael Cullen announced the state-owned company would slash between 1500 and 2000 jobs from its processing, delivery, retail and corporate operations.
"That impact on people is very regrettable but it's something we can't avoid given the changes to how customers and the broader community are using our services," Cullen said.
"New Zealanders are well aware that our traditional letter mail business is in irreversible decline.
"Letter volumes have fallen 30 per cent since 2006, and we are facing further significant decline within the next five years."
NZ Post employs about 10,600 staff.
The government agreed last month to amend NZ Post's service obligations, allowing the company to cut its deliveries from six days a week to three in urban areas.
Rural deliveries will continue five days a week.
The delivery service changes follow a continuing fall in mail volumes, of about eight per cent a year, with 328 million fewer items posted in 2013 than in 2002.
The government says without the changes, it may have to subsidise NZ Post to the tune of more than $NZ30 million ($A26.48 million) each year.
In June, NZ Post announced the closure of three of the company's six mail handling centres along with processing operations at 54 small locations.
Centres at Auckland, Palmerston North and Christchurch are to be expanded.
About 500 part and full-time jobs will be lost from the closing centres, with 380 new jobs created in the expansion of the remaining centres.