American Industry Overview: United States Postal Service

Industry Snapshot

The U.S. Postal Service is one of the largest organizations in the world. In 2009, it had more than 7,663,000 employees and revenues of $74.9 billion. In fiscal 2009 it handled more than 203 billion pieces of mail through an extremely complicated system of carefully coordinated activities. In addition to the national headquarters in Washington, D.C., the U.S. Postal Service consisted of regional and field division offices that together supervised 36,400 post offices, branches, stations, and community post offices. Also known as USPS, the organization delivered to 150 million U.S. addresses and had a fleet of more than 218,000 vehicles. It also shipped millions of pounds of mail daily on various airlines, making it the nation's largest shipper. It was the second-largest civilian employer in the United States in the 2000s, behind Wal-Mart Stores, Inc.

The U.S. Postal Service was created as an independent establishment out of the old Post Office Department by the Postal Reorganization Act of 1970 and commenced operations on July 1, 1971. The industry is highly labor intensive, with employee wages and benefits accounting for almost 79 percent of the system's total costs. To cope with its soaring costs, the organization increased postal rates consistently, from 6 cents at the onset of the Postal Reorganization Act to 44 cents in 2009 for first-class letters. It also faced increasing competition from private mail and package delivery services as well as technologies such as facsimile services, e-mail, and online bill paying that reduced the need for postal services.

Organization and Structure