On the heels of implementing new Peak Season Surcharges, the US Postal Service is likely to raise postage rates again in January 2023. Inflation is expected to hit the 2022 budget by over a billion dollars, U.S. Postmaster General DeJoy told USPS Governors at their August 9 meeting.
The USPS announced last year it would raise postage prices twice a year beginning in 2023.
“As everyone knows, inflation has hit the nation hard, and the Postal Service has not avoided its impact,” DeJoy said. “We expect inflation to exceed our expectations by well over a billion dollars against our planned 2022 budget.”
“Because of this, my recommendation to the governors will be to remain on course to raise prices again in January,” he said.
The USPS reported in the third quarter inflation has impacted operating expenses. Compensation increased $198 million, or 1.6 percent, primarily due to wage increases in labor agreements tied to inflation. Highway transportation expense increased $131 million, or 10.1 percent, primarily due to higher diesel fuel costs. Other operating expense increased $373 million, or 14.9 percent, reflecting higher fuel prices for delivery vehicles and an increase in rent and utilities.
“I will soon begin to evaluate what we will be doing in 2023 as I pledge to keep the mailing community informed,” he said. “We must deal with the reality of our financial status and the impact inflation will have on our improvement strategies.”
The USPS under the direction of Mr. DeJoy is keeping a close watch on income and expenses as all businesses should be doing. Treating the USPS like a business is certainly a change from the past.
Are you struggling to control raising shipping costs? Reach out to our experts today to help you navigate the changes and look for ways to lower costs while increasing service. We’re standing by.
to receive our FREE white papers: