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. For the 2019 fiscal year, it lost $8.8 billion on $71.1 billion of operating revenue.īecause of the rise of email and digital communication, USPS has seen the volume of First-Class Mail decline from a peak of 103.5 billion pieces in 2000 to just shy of 55 billion pieces in 2019. From 2008 to 2018, it reported $69 billion in losses. The USPS has operated at a loss since 2007. 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. What are the long-term problems with how the Postal Service is financed? Although COVID-19 has choked off the USPS revenue in recent months, factors that arose well before coronavirus have contributed to the unsustainability of the Postal Service’s financial situation for years. It relies on revenues from stamps and other service fees. The Postal Service receives no direct taxpayer funds. The Board appoints the Postmaster General, who acts as the CEO.Ī separate Postal Regulatory Commission with five members appointed by the President and confirmed by the Senate oversees the USPS, including the rates it charges. All six of the current independent governors were appointed by President Trump three slots are empty. USPS is operated by a 11-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. In 1971, Congress replaced the Department with the United States Postal Service, an independent entity within the executive branch. The Post Office Department was created in 1792 and became a Cabinet department in 1872. The Second Continental Congress appointed Benjamin Franklin as the first Postmaster General in 1775. As the financial standing of the Postal Service makes headlines, we examine how it is set up, what financial challenges it faces, and how it is managing these challenges during a global pandemic.
The COVID-19 pandemic has severely threatened demand and revenue for USPS, straining its already fragile finances. It would have ranked number 44 on the 2019 Fortune 500 if it were included. It serves 160 million homes, businesses, and other delivery points. It employs over 600,000 only two private employers (Amazon and Walmart) employ more people. The United States Postal Service (USPS) is big.
0 kommentar(er)
