The United States Post Office (USPS) recently said it is updating its mail prices this summer.
Why It Matters
The agency serves nearly 169 million addresses in the U.S., delivering more mail and packages than any other postal service in the world, according to the USPS website. However, it has lost more than $100 billion since 2007, including $9.5 billion in the 12 months ending September 30, 2024.
These profit losses have caused the agency to switch up its pricing and packaging policies under the Trump administration as a way to reduce financial costs.
What To Know
The USPS filed notice of its upcoming price changes and mailing standards on April 9. The updates include pricing structures and some product offerings.
The new rates will cause Americans to see a 5-cent increase in the price of a First-Class Mail Forever stamp from 73 cents to 78 cents.
Some of the changes concern mail preparation and bundling, but Americans will also see the USPS get rid of its marketing mail commercial and nonprofit automation basic carrier route categories. This is because the USPS doesn’t gain any cost savings from these route letter group pricing.
The USPS is also proposing to remove Bound Printed Matter from the market-dominant product list. Flats would move to USPS Marketing Mail, and a new “Heavy Printed Matter” category would be introduced for parcels weighing up to 15 pounds.
All of the updates go into effect July 13. Altogether, the proposed changes call for mailing services product prices to rise by approximately 7.4 percent.
These changes are intended to help modernize the USPS, simplify its mailing standards, and better align pricing with service costs, experts say, but it’s also an effort to run the federal service more like a business.
What People Are Saying
Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek: “In reality, the government is trying to reduce USPS’s ongoing losses and run it more like a business. Yet, as we know, the government’s role should primarily be to step into markets where private enterprise fails, and USPS still delivers mail to areas that others can’t reach at a reduced cost.”
Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, told Newsweek: “The proposed changes for postage stamps to have another 5-cent price increase marks just the most recent in a series of price jumps over the last four years. USPS continues to try to make their business model more sustainable after years of being a huge money-loser to the tune of billions of dollars. These potential price increases combined with more efficient technology efforts to modernize deliveries will look to narrow losses and hopefully – in time – make the postal service a more profitable venture.”
What Happens Next?
Thompson said the changes are part of the Trump administration’s attempts to make the USPS more efficient and cost-effective.
“Viewing the nation more through a business lens, this could lead to fewer mailing options by eliminating certain rate categories, potentially higher prices, and at the same time, more efficiency through simplified mail preparation, new discounts, and incentives for businesses adapting to a changing environment,” Thompson said. “Cost may rise on the end consumer, but the hope is that efficiencies follow.”
President Donald Trump has previously signaled his support for privatizing the USPS. Commenting on possible privatization a few months ago, Trump said “it’s an idea that a lot of people have liked for a long time.”
Trump adviser Elon Musk has also said he would support bringing the postal service out of public control.
The president has also floated the idea of bringing the independent federal agency under the control of the Commerce Department.
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