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USPS Updates for 2012
By Mary Schultz, Production Manager
January 2012

The U.S. Postal Service (USPS) announced recently that it will increase postage rates on January 22, 2012; this will be the first increase since last April, when rates were raised 1.7%. The 2012 rate hike comes after a decrease in revenue for the USPS, largely due to a continual decline in the quantity of first-class mail. The Postal Service ended the 2011 fiscal year with a $5.1 billion net loss, with first-class mail dropping from $34.2 billion in 2010 to $32.2 billion in 2011.

“The U.S. Postal Service must reduce its operating costs by $20 billion by 2015 in order to return to profitability,” said David Williams, vice president, Network Operations. “The proposed changes to service standards will allow for significant consolidation of the postal network in terms of facilities, processing equipment, vehicles and employee workforce and will generate projected net annual savings of approximately $2.1 billion.”

While individual product and service rates will vary, mailers can expect to see the following letter rate changes:

  • First-class stamps will increase from $0.44 to $0.45

  • Standard mail will have an overall increase of 2.1%

  • Nonprofit letters will see a price reduction of about $0.002 per piece

With rate increases failing to offset the lost revenue from the dip in overall volume, the USPS is looking for ways to reduce costs, including consolidating postal facilities. Of the 487 mail processing facilities nationwide, the USPS is looking at possibly closing 252 of them. They are also considering closing thousands of post offices this year. The earliest to expect any closures would be May 15, 2012, as the USPS reviews the facilities and Congress plans to consider postal legislation early this year.

Another strategy designed to save costs for the USPS is to eliminate overnight delivery of first-class mail, so that delivery time would be two to three days. However, mailers who have prepared and entered mail at designated processing facilities will have the opportunity to have their mail delivered the next day. The Postal Regulatory Commission is reviewing the changes, so no modifications should be expected before April 2012.

These possible changes come in addition to those the Postal Office has already been looking into, such as eliminating Saturday delivery and evaluating their retirement program.


Schultz & Williams is a national consulting firm based in Philadelphia providing management, fundraising and marketing consulting for nonprofit organizations, along with full-service direct marketing, database and creative/production services.