Postal

Why Does the Price of Stamps Keep Increasing?

CCozort — Wed, 17 Jul 2024 19:46:39 +0000

Why Does the Price of Stamps Keep Increasing?

CCozort Wed, 07/17/2024 - 15:46

On July 14, 2024, the price of a first-class stamp increased from $.68 to $.73. This is the 6th rate hike since 2021. Postal rates are climbing faster than inflation.

But why? We explain why United States Postal Service (USPS) postal rates went up and what higher postal rates mean for the paper industry.

Breaking Down the USPS “Delivering for America Plan”

The Delivering for America Plan (DFA) was published in March of 2021 by Postmaster General Louis DeJoy. The goals for the plan were to:

Achieve financial stability;
Improve postal service; and
Reorganize key networks like delivery and processing.

It is important to note: As these goals were developed, stakeholder input was not solicited from those who rely on USPS – like the paper industry.

Understanding the Postal Service Reform Act of 2022

The bipartisan Postal Service Reform Act was signed into law in 2022, giving USPS $50 billion in relief of financial obligations and budget deficits. The legislation aimed to:

Increase financial stability for USPS;
Increase transparency;
Improve postal service; and Keep U.S. mail as a competitive option.

One of the provisions was mandating 6-day-a-week delivery for mail. However, the bill did not address postal rate uncertainty.

Are Postage Rate Increases Helping USPS?

The short answer is no. Through the DFA, USPS increased postage rates to help address financial challenges. Since 2021, postage rates have increased a record 6 times. In fact, postal rates have risen faster than inflation!

Meanwhile, USPS continues to suffer financial losses as well as service and operational issues. Here are a few examples:

Financial: In FY2023, they lost $6.5 billion. They are estimated to lose another $6.3 billion in FY 2024. The U.S. government’s fiscal year starts on October 1 and ends the following year on September 30.
Mail Volume Declines: Rate hikes have contributed to driving steep declines in mail volume. Mail volume is the total number of pieces of mail delivered. Annual volume since 2020 has declined by 13 billion pieces, or 10%.
Service: Just 83% of first-class mail was delivered on time in the beginning of 2024 compared to the DFA target of 95%. That’s the lowest service level in 3 years.

This is unsustainable for the Postal Service and those who rely on them for their business and communication, such as industries like ours and the families who live and work in our communities.

Postage Rate Hikes and Service Issues Affect the Paper Industry

USPS is an essential service to our industry and those who use our products, delivering approximately 39% - or nearly $6.5 billion worth - of communication papers produced in the U.S.

Things like:

Postcards;
Billing statements and promotional offers; and
Personal mail like a birthday card or letter to a friend or family member.

These rate hikes make mail less affordable, reduce on-time delivery service, and drive down mail volume. Our industry relies on USPS.

We need consistent and timely service, and postal rates that are predictable and affordable.

Update in Brief

Postal

Business Impact

AF&PA Supports Bipartisan Postal Service Reform

TEbner — Tue, 08 Feb 2022 20:13:11 +0000

AF&PA Supports Bipartisan Postal Service Reform

TEbner Tue, 02/08/2022 - 15:13

CONTACT: Tim Ebner
comm@afandpa.org

WASHINGTON – The American Forest & Paper Association (AF&PA) President and CEO Heidi Brock released the following statement in response to House passage of The Postal Service Reform Act (H.R. 3076):

“The American Forest & Paper Association supports comprehensive and bipartisan solutions to ensure the long-term financial stability of the United States Postal Service (USPS). Passage of the Postal Service Reform Act in the U.S. House of Representatives is a step in the right direction. This legislation will move the USPS on a path to better financial footing and remain a competitive choice in the 21st century. Although the bill does not address rate uncertainties, this legislation does make significant strides to improve USPS operations. We welcome additional policy to provide rate certainty, similar to the rate cap included in the 2006 Postal Accountability and Enhancement Act.

“USPS plays a critical role for our nation’s communications and commerce. Americans and businesses across the country depend on timely and affordable mail and package delivery services. In 2020, USPS delivered approximately 39 percent, or nearly $6.5 billion worth of communications papers produced in the U.S. and delivered 7.3 billion parcels with paper-based packaging materials.

“These reforms will increase transparency, improve service and advance the Postal Service towards a more sustainable future. We encourage the U.S. Senate to take up this important legislation and send it to President Biden’s desk.”

Press Release

Postal

Business Impact

AF&PA Highlights U.S. Postal Service Response to Questions about the Safety of Receiving Packaging and Mail

superuser — Fri, 20 Mar 2020 15:58:37 +0000

AF&PA Highlights U.S. Postal Service Response to Questions about the Safety of Receiving Packaging and Mail

superuser Fri, 03/20/2020 - 11:58

CONTACT: Lindsay Murphy / Tim Ebner
(202) 463-2587, comm@afandpa.org

WASHINGTON – American Forest & Paper Association (AF&PA) President and CEO Heidi Brock today highlighted statements from the United States Postal Service (USPS) in response to questions about the safety of receiving packaging and mail:

“American Forest & Paper Association (AF&PA) members take safety very seriously, and our industry diligently continues to manufacture products to help customers address current challenges related to COVID-19.

“The Centers for Disease Control and Prevention (CDC) and the World Health Organization (WHO) have provided guidance indicating there is no evidence COVID-19 is spreading through the mail, and WHO has further stated that the risk of catching the virus from a package that has been moved, traveled and exposed to different conditions and temperatures is low.

“Paper products play an important role in facilitating product safety, enhancing hygiene and responding to COVID-19 challenges. Our industry remains committed to meeting the needs of its customers and the public, particularly in this dynamic environment.”

Additional background:

Paper and wood products are essential components of modern life. They are made from a renewable resource (trees) and encompass a wide range of products that facilitate education, communications, hygiene, food storage, product protection and provide shelter and homes. For example:

Packaging and wrapping facilitate the safety of food, products, and commerce;
Products like paper towels, bathroom tissue, hand towels, paper handkerchiefs, napkins, paper cups, and paper plates – among others – enhance hygiene; and
Biocidal sanitary wipes and protective face masks reduce exposure.

For more information, visit www.afandpa.org.

Press Release

Postal

Covid-19