OTTAWA—Canada's government-owned postal agency said Wednesday it will eliminate home mail delivery over the next five years and cut its workforce by as many as 8,000 positions in an attempt to reverse annual losses that could hit 1 billion Canadian dollars (US$943 million) by the end of the decade.

Ottawa-based Canada Post Corp. is one of many postal agencies in the developed world grappling with heavy financial losses as people abandon traditional letter-mail for electronic communications. But its proposed changes—notably...