The Postal Service was designed to be self-sufficient — unlike other federal agencies, it does not live off dollars collected as taxes. Rather, it tries to cover its operating expenses by charging postage. Sorting and transporting mail is an inherently costly proposition.
It has , trucks and other vehicles to help it haul all that mail. But that is not the whole of it. USPS also runs a massive retail operation in the form of 31, post offices and another 4, contractor-run mail shops, each with their own overhead costs. The Postal Service has limited tools to control its overhead.
Laws and political pressures harry its every effort to reduce delivery frequency presently mandated at six days per week and shutter money-losing post offices.
By law, the vast majority of all USPS positions are held by unionized federal employees who have robust job protections. The agency has , fewer employees than it did a few decades ago. Still, USPS has , employees and , retirees who receive health and pension benefits. A look at the revenue side of the ledger reveals why. Mail volume is sliding. Less mail means less money. In , Congress replaced the Department with the United States Postal Service, an independent entity within the executive branch.
USPS is operated by a person Board of Governors which resembles the board of directors of a public corporation —the Postmaster General, his deputy currently vacant , and nine governors appointed by the President and approved by the Senate for seven-year terms.
All six of the current independent governors were appointed by President Trump ; three slots are empty. The Postal Service receives no direct taxpayer funds. It relies on revenues from stamps and other service fees. The fundamental problem is that while the USPS generates enough revenue to cover its operating costs, its pension and retiree health care liabilities push its bottom line into the red.
The USPS has operated at a loss since USPS has tried to increase the delivery of marketing mail and has tried to compete with UPS and FedEx in the parcel delivery sector, including by forging a delivery deal with Amazon. This has provoked criticism from President Trump. It currently has , of them, down from , in Like many employers, the Postal Service provides pensions for its retired employees—and it is required, as private companies are, to set aside money from current income to cover its pension promises.
In addition, USPS provides health benefits to its retirees, as other government employers— but not all large private employers —do.
The Postmaster General came under congressional fire this week for his potential plan to scrap two-day, first-class mail delivery and hike the cost of postage to make up for the billions of dollars in annual USPS losses. The USPS boasts a massive budget as well as massive losses, and the problem goes back years. Package delivery increased sharply during the pandemic It seems like the more the Postal Service sells, the more they lose.
Last year, the agency hired , employees — the most in its history — for a net gain of 54, employees on payroll. For perspective, USPS hired 40, employees in ; 38, employees in ; and 26, employees in , according to Freedom of Information Act requests filed by our auditors at OpenTheBooks.
In fact, the postmaster general out-earns actual U. DeJoy and Brennan have plenty of company. Nearly employees have been on the job for at least 50 years; 8, for at least 40 years; 76, for at least 30 years; and , for at least 20 years.
Post Office defenders might suggest that the USPS could lean on its stable of veteran workers to help generate best-in-class ideas to help balance the books.
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