BAGHDAD -- A decade after the start of the war in Iraq, the American diplomatic footprint here is shrinking fast.

As recently as a year ago, the immense U.S. Embassy in Baghdad and other sites around the country were staffed by more than 16,000 personnel. Today, that number has fallen to about 10,500, U.S. Ambassador Robert Stephen Beecroft said this week.

By the end of the year, Beecroft said, he expects to have just 5,500 employees in Iraq. Most of them will be security personnel and other outside contractors assigned to support the fewer than 1,000 diplomats who remain. More cuts are expected beyond the end of the year.

"That number will continue to go down. And they'll go down largely on the contracting side," Beecroft said in his residence on the heavily guarded compound on the banks of the Tigris River.

The sprawling, fortress-like U.S. Embassy officially opened in early 2009 at a cost of more than $730 million as the largest American mission in the world. But it has been under pressure to cut costs.

The downsizing in many ways reflects how sharply wartime assumptions about the extent of American influence in Iraq have shifted since construction on the Vatican City-sized compound began in 2005. Sweeping reconstruction and nation-building efforts championed early on are much less of a priority today, even as Iraq's Shiite-led government forges stronger ties with neighboring Shiite powerhouse and U.S. foe Iran.

America still has influence here, with Iraq-based diplomats and officials in Washington in frequent contact with Iraqi political and military leaders. But Washington was unable to win Iraqi guarantees that would have allowed a continued military presence -- something that deprived the U.S. of important leverage in Baghdad, former U.S. Secretary of Defense Leon Panetta recently told a government watchdog.

After the American military withdrawal in December 2011, plans for the embassy to take over much of the reconstruction work also have been scaled back.

"We found pretty quickly that we didn't need all the people and we could do what we needed to do with far fewer," Beecroft said.

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