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U.S. Postal Service

• The U.S. Postal

service, originally

called the Post

Office Department,

was formed in 1775.

The history of U.S.

Postal Service is, in

many way, the

history of the U.S.

itself.

That a postmaster General be appointed

for the United Colonies, who shall hold his

office at Philadelphia, and shall be allowed a

salary of 1000 dollars per an: for himself,

and 340 dollars per an: for a secretary and

Comptroller, with power to appoint such,

and so many deputies as to him may seem

proper and necessary.

That a line of posts be appointed under

the direction of the Postmaster general, from

Falmouth in New England to Savannah in

Georgia, with as many cross posts as he shall

think fit

U.S. Postal Service

• Some very famous

Americans have

been involved in the

U.S. Postal Service.

U.S. Postal Service

• As the U.S.

population has

grown, so has the

amount of mail

generated.

• This table

summarizes the

amount of mail

handled over the last

century.

U.S. Postal Service

• Here is the graph

of the data,

which overall

shows strong,

steady growth.

U.S. Postal Service

• However, if we

focus in on the

last thirty years,

you can see

some flattening

in the graph

since 2000.

U.S. Postal Service

• This table shows

the Operating

Revenue and

Operating

Expenses over

the last century.

U.S. Postal Service

• Here is the graph

of the data.

• Note that

throughout the

last century,

income barely

outpaced

expenses.

U.S. Postal Service• To see this more

clearly, here is a

graph of the

difference

between

Revenue and

Expenses for the

same period.

• Note that over

the past 30

years, the U.S.

Postal Service

has shown a

profit, though a

declining one.

U.S. Postal Service• Since the 1990’s,

when e-mail use

began to

dramatically

increase, the

U.S. Postal

Service has been

profitable, unlike

its prior history.

But this era of

profitability has

been temporary.

U.S. Postal Service• Notice that since

2006, expenses

have overtaken

expenses at an

accelerating

pace.

• Not only that,

revenue has

continued to slip.

U.S. Postal Service• Why has revenue

declined?

– The

overwhelming

reason is

because of a

dramatic drop in

the number of

pieces of mail

sent. During a

five-year period

over 41 billion

fewer pieces of

mail were sent

out!

U.S. Postal Service• Think of reasons

why there would

have been such

a huge drop in

mail during this

period.

U.S. Postal Service• During the same

period, expenses

dramatically

increased, even

while revenue

was declining.

U.S. Postal Service• One way that the

U.S. Postal

Service has tried

to control costs is

to reduce the

number of

employees. Note

the dramatic drop

in employees

during this 5-

year period.

U.S. Postal Service

• Over the next

few years, many

post offices

around the

country will

close, as another

way to control

costs.

• But the

challenges the

U.S. Postal

Service faces are

huge.