The United States Postal Service (USPS) has been grappling with financial losses for years, but it’s finally seeing some light at the end of the tunnel. By cutting back on 50 million work hours and shutting down unnecessary facilities, the agency has saved billions annually. This is all part of USPS’s 10-year “Delivering for America” plan, which is focused on boosting both financial and operational efficiency.
USPS has also managed to bump up its annual revenue by $3.5 billion. They’ve done this by updating their product offerings, especially since First-Class Mail volume has been on the decline. Additionally, the agency is making strategic changes to service standards, aiming to save at least $36 billion over the coming decade.
While these service enhancements are designed to be seamless, there could be slight delays in First-Class Mail delivery for some regions. This might mean a one-day extension in delivery times for certain mail collected at specific post offices. Despite these minor changes, USPS says the overall delivery speed for both mail and packages should get better.
This revamp will roll out in two phases, with the first starting on April 1 and the second on July 1. Postmaster General Louis DeJoy mentioned that the agency has been bogged down by outdated rules that don’t reflect the current mail volume and mix. As a result, operations have been “costly and ineffective.”
For years, Congress has resisted meaningful changes, which has only added to USPS’s operational challenges. Even with revenues climbing from $78.18 billion to $79.53 billion, the agency reported a net loss of $9.5 billion for fiscal year 2024. Despite these challenges, USPS remains committed to improving its financial state.
Back in April 2024, USPS faced criticism from a group of senators for its decision to raise postage rates. They argued that the price hikes had “disastrous effects,” resulting in an 11 billion piece drop in mail volume and $6.5 billion in losses. The senators accused USPS of blaming inflation, even though mail prices had nearly doubled compared to inflation rates.
USPS raised postal rates twice last year, a move that didn’t sit well with everyone. As part of its recovery strategy, USPS is now collaborating with the Department of Government Efficiency (DOGE) and the General Services Administration (GSA). The goal is to identify further efficiencies, particularly in the management of retirement assets and compensation programs.
DOGE aims to tackle the “mismanagement” issues that have plagued USPS’s Workers’ Compensation Program, which has incurred $400 million in excessive annual charges. They will also look into regulatory requirements that have cost the postal service over $50 billion. However, not everyone is thrilled with USPS’s partnership with DOGE.
The American Postal Workers Union has voiced its concerns, asserting that there is “no legitimate role” for DOGE in the postal agency. They are committed to resisting any efforts that may weaken their union rights or contractual protections. On the other hand, the National Association of Letter Carriers is more receptive to the collaboration.
Association President Brian Renfroe believes DOGE can help resolve issues the association has been addressing for years. These include USPS’s pension liabilities and a new investment strategy for its retirement funds. Such policy changes could significantly improve the Postal Service’s financial health.
Earlier this month, Elon Musk of DOGE suggested privatizing USPS, a move that the National Association of Letter Carriers opposes. In a social media post, they emphasized the importance of “universal service” and vowed to protect it. President Donald Trump also floated the idea of privatization, suggesting a merger with the Commerce Department, but this was met with opposition from Democratic lawmakers.
