The United States Postal Service (USPS) is undergoing significant changes as it grapples with substantial financial losses and declining mail volumes. The USPS has reported losses exceeding $100 billion since 2007, largely attributed to the dwindling use of first-class mail, which has declined by 80% since 1997 and reached its lowest level since 1968. In response, the USPS implemented a 10-year restructuring plan in 2021 aimed at reversing these trends.
Headed by Louis DeJoy since 2020, the USPS is focused on eliminating $160 billion in projected losses over the next decade. However, the agency still anticipates a loss of $80 billion during this period. DeJoy recently announced he had requested the USPS governing board to find his successor, marking a forthcoming leadership shift as the organization navigates these challenges.
Efforts to stabilize the USPS's financial health include recent price adjustments. In July, the USPS increased the price of a first-class mail stamp to 73 cents from 68 cents and raised overall mailing services product prices by 7.8%. Despite these measures, first-class mail volume continues to decline, with a 3.6% drop year-over-year to 44.3 billion pieces. Notably, the USPS decided against raising stamp prices in January for the first time in two years.
The USPS's financial difficulties have sparked concerns about its future viability. DeJoy articulated the severity of the situation, stating that without continued cost-cutting efforts, the USPS is on a trajectory toward either a significant government bailout or potential dissolution.
"government bailout or the end of this great organization as we know it" – Louis DeJoy
In addition to financial restructuring, the USPS is adapting its operations to meet modern demands. In December, DeJoy defended plans to increase the acquisition of electric vehicles as part of the USPS's sustainability efforts. This initiative aligns with broader governmental and environmental goals.
Moreover, the USPS received a $3 billion infusion from Congress after successfully overseeing the delivery of millions of ballots during the 2020 presidential election. This support underscores the critical role that USPS plays in maintaining democratic processes.