USPS Holds Line on Stamp Prices Amid Financial Reforms

The U.S. Postal Service announced it will not increase stamp prices in January 2023, despite a series of hikes in recent years. The agency, facing a $6.5 billion yearly net loss, continues its 10-year restructuring plan to eliminate $160 billion in predicted losses, while projecting to generate $44 billion in additional revenue by 2031.

For the first time since January 2022, the U.S. Postal Service (USPS) will not increase stamp prices in January, following a trend of several price hikes in recent years. In July, the USPS raised the price of a first-class mail stamp to 73 cents from 68 cents, alongside a 7.8% increase in overall mailing services product prices.

Stamp prices have surged by 36% since early 2019 when they were at 50 cents. 'Our strategies are working and projected inflation is declining,' said Postmaster General Louis DeJoy. 'Therefore, we will wait until at least July before proposing any increases for market dominant services.'

In November, USPS reported a $6.5 billion yearly net loss, with first-class mail volumes plummeting to their lowest since 1968. This decline in volume is part of why USPS has been hiking stamp prices and undergoing a 10-year restructuring plan announced in 2021, aiming to eliminate $160 billion in predicted losses over the next decade.

'We're continuing to drive transportation costs down,' DeJoy told Reuters, estimating a reduction of $1 billion in transportation expenses this year. USPS projects its new pricing policy will generate an additional $44 billion in revenue by 2031.

First-class mail, the highest revenue-generating mail class, brought in $24.5 billion or 31% of USPS's 2023 revenue. President Joe Biden had also signed legislation in 2022, providing USPS with approximately $50 billion in financial relief over a decade. DeJoy agreed in May to delay further consolidation of the postal service's processing network until at least January, after senators raised concerns about the impacts on mail delivery. Last month, USPS stated its plan to implement changes projected to save the agency around $30 billion over the next decade.

(With inputs from agencies.)