COVID-19 may have frozen ad budgets, including direct mail, but the financial woes of the U.S. Postal Service have pre-dated the current crisis. Calls for postal reform to facilitate all types of fiscal fixes have gone unanswered, despite bipartisan support to get the job done. Huge Congressional mandates from 2006 to pre-fund healthcare costs for future retirees—which do not exist to any such extent in the private sector—are just one example of how politicking gets in the way of running USPS more efficiently.
On paper, the U.S. Postal Service should be holding its own. And it had been through the end of last year.
A Formidable Job of Management Couldn’t Predict a Crash
Mix and match, but it’s been managed. In 2010, First-Class Mail volume was 77.6 billion pieces. In 2019, it was 54.7 billion—a nearly 30 percent decline. Marketing Mail also declined, but less precipitously—from 81.8 billion pieces to 75.7 billion. Meanwhile, as direct-to-consumer (DTC) shopping has taken hold, parcel volume has doubled from 3.1 billion to 6.2 billion package deliveries, making the USPS truly the Greatest Carpool on Earth. (Happy Earth Day.)
And though there is mail volume decline, the “mail moment” remains vital, and delivery points have increased from 150.9 million in 2010 to 160 million in 2019. Against this expanse, the USPS has shed 93,000 jobs in 10 years, maintaining 497,000 positions in 2019.
Throughout all this, USPS operating revenue has increased to more than $71 billion, from $67 billion in 2010. Rate hikes have been predictable and better managed. So why the carnage?
Yes, it’s COVID-19. Mail volumes reportedly have dropped by 30% since the crisis began. Add to this the hands-tied effects of the Congressional mandates—and it’s no wonder the USPS Postmaster General is seeking a “we need cash” bailout. This time, will Congress—and The White House—answer the call? According to The Washington Post, as of Friday, April 24, President Trump stated he would not approve of emergency aid for the Postal Service if it didn't raise prices for package delivery immediately.
We Can Debate the Amount – But Let’s Recognize These Heroes at Work
The U.S. Postal Service is a quasi-governmental operation that answers by U.S. Constitution to the American people—but is called upon to run as a business. And it indeed tries. Yet it can’t just set rates on its own, as everyone gets a voice in rate-making and operations, even competitors.
Even in crisis, exacerbated by COVID-19, there’s not likely to be new postal reform bill any time soon. So here we are now: the U.S. Postal Service needs financial protection.
It’s hard to blame the USPS, but that doesn’t stop President Trump from calling out sweetheart deals that don’t exist. Add to the cacophony those who wish to privatize—answer to shareholders instead of the public—and sparks fly. Postal labor interests, for one, are powerful—and so are marketing mail and parcel customers. No one wants to upend the letter carrier.
So as I put on my mask and gloves, and go to the mailbox as part of my daily heightened ritual, I retrieve my personally addressed parcels, flats and letters. I spray them with Lysol. I open and read each piece, and I recycle each piece when I’m done (Happy Earth Day again). And I wish Godspeed, and a few billion tax dollars, to all these postal heroes who are keeping American commerce every day in movement. We need you. America needs you. Thank you.