Stamp prices may increase in 2024 while Postal Service struggles financially

The U.S. Postal Service proposed a nearly 8% increase for stamp prices on Tuesday — the latest in a three-year series of postage price hikes for the financially struggling federal agency.

The price changes were set to take effect on July 14 if approved by the Postal Regulatory Commission, an independent body overseeing the Postal Service. Among the proposed changes were a nickel increase for first-class Forever stamps from 68 cents to 73 cents, a 3-cent increase for domestic postcards from 53 cents to 56 cents and a dime increase for international postcards from $1.55 to $1.65.

If approved, the proposed postage price hikes would mark the sixth round of rate increases by the Postal Service since 2021. The most recent round of increases came in January when the cost of first-class stamps rose by 2 cents from 66 cents to 68 cents.

The tentative price increases were a part of the Postal Service’s 10-year Delivering for America plan, which aimed to transform the agency from “an organization in financial and operational crisis to one that is self-sustaining and high performing,” according to the Postal Service’s website.

The Postal Service stated in a Tuesday news release that “these price adjustments are needed to achieve the financial stability” sought in the plan “as changes in the mailing and shipping marketplace continue.”

The Postal Service has encountered financial challenges primarily due to a years-long mandate requiring advance funding of employees’ retiree health benefits, resulting in substantial financial losses. In addition, fewer people have been sending First-Class mail due to the rise of online communication, with the number of individual letters sent annually decreasing by approximately 50% over the past decade.

This year, the Postal Service expects to lose $6.3 billion after losing $6.5 billion last year. Generally, its operations are not funded using tax revenues.

Despite the price increases over the years, first-class stamps in the U.S. still cost less than they do in many other developed countries, according to the USPS Office of Inspector General. Out of 30 countries the office surveyed, only four countries’ stamps were cheaper than America’s.

“USPS prices remain among the most affordable in the world,” the Postal Service stated.

While it’s rare for the Postal Regulatory Commission to deny the Postal Service’s proposals, it has happened before. In 2010, the commission declined a price increase because the Postal Service “failed both to quantify the impact of the recession on its finances and to show how its rate request relates to the resulting loss of mail volume,” according to a statement.

Madeline Nguyen is a breaking news reporter for The Republic. Reach her at Madeline.Nguyen@gannett.com or 480-619-0285. Follow her on X @madelineynguyen.