The United States Postal Service (USPS) has announced Wednesday proposed price changes in postage for 2019. The USPS proposal includes raising the price of a first-class stamp by 10% from 50 cents to 55 cents (see below for the projected changes) and raising rates by more than 12% for Amazon.com Inc. and other shippers.

Under the requirements of the Postage Accountability and Enhancement Act (PAEA) of 2006, mailing services prices for market dominant products increases cannot be greater than the rate of inflation increase as measured by the Consumer Price Index (CPI). The Postal Service can request a rate increase above the cap due to extraordinary or exceptional circumstance, however the price increase would need to be approved by the Postal Regulatory Commission (PRC).

In 2018, First Class Package Service rates increased by an average of 3.9 percent. Postage rates have increased only an average of one cent every year for the past ten years. Consumer Price Index rates of inflation have remained below 4% since 1992.

As the Wall Street Journal observed, an “increase on first-class stamps would be the largest on a percentage basis in more than three decades.” The proposed pricing is still in review with the Postal Regulatory Commission (PRC) for the high proposed increases. President Trump’s comments on social media regarding the Postal Service display concerns relating to Parcel Select rather than first-class mail. “Large shippers like Amazon, as well as carriers like United Parcel Service Inc. and FedEx Corp., use Parcel Select to deliver packages the last leg of a trip to the customer’s door. The so-called last mile is typically the most expensive part of an online order’s journey,” noted the Wall Street Journal.

The proposed pricing has not been approved yet by the Postal Regulatory Commission (PRC), and any changes that are approved won’t take effect until Jan. 27, 2019. The percentage increase to first class presort and standard is far from certain, and we will update our blog when more information becomes available.

Mailing Services Proposed Rates: