How to Know How Much Stamps You Need
Why Does the Cost of Postage Stamps Change?
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After a new proposal by the U.S Postal Service in October 2018, the price of postage stamps and other products will increase in January 2019. The price for first-class Forever stamps, which currently cost 50 cents, will go up to 55 cents on January 27. Postage prices go up regularly, and this is just the latest in a series of price increases in recent years. Let's take a look at the reason for postage stamp increases.
The History of the U.S Postal System
The postal service in the United States began with stampless letters. The cost of these letters was paid by the person receiving the letter. Overseas letters were sent to America on ships and then advertised in local papers for recipients to pick them up and pay for them. The first U.S. postal rates were set by Congress as part of the Postal Service Act. President George Washington signed it into law on February 20, 1792. Postal rates were adjusted according to the zone you lived in, and zones were determined by the distance a letter had to travel from the originating post office to where it was delivered. Double and triple rates were charged as a letter's size increased. Before postage stamps were introduced in 1847, the dates and origin of letters were written by hand or with a hand stamp device. The use of stamps became mandatory in 1855.
Increased Operating Losses
The post office isn't funded by tax dollars for operating expenses, and it relies on the sale of its products and services to fund its operations. In 2017, the United States Postal Service (USPS) reported its 11th straight year of financial losses. In August 2018, the postal service posted third-quarter losses of $1.49 billion, even though revenue had increased from $16.67 billion to $17.07 billion. Many factors, including the use of email, contributed to the post office experiencing a mail volume decline of 3.2 billion pieces. According to Fox Business, first-class mail — the source of the most significant share of income — declined by 3.6 percent. This prompted the Postmaster General to call on the government to allow the USPS to raise postage rates.
Reason for Price Increases
Postage prices have steadily increased over the years, in line with rising labor and transport costs. The latest postage price increase is an effort by the USPS to offset record operating losses that totaled almost $4 billion in 2018. The January price hike is the biggest cent increase in USPS history. Previously, the largest price increase occurred in 1991, when the cost of a stamp went from 25 cents to 29 cents. The Postal Regulatory Commission approved increased rates across the board, including letters and packages. According to a recent news release by the agency, it has some of the lowest mail postage rates in the industrialized world. This rate increase is designed to keep the post office competitive while providing much needed revenue.
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How to Know How Much Stamps You Need
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