GROW. RISE. TOGETHER.
adopted a new price cap formula in 2021, which allowed the Postal Ser- vice additional authority to increase Market Dominant prices beyond the CPI. Since 2021, USPS has used this authority and raised Market Domi- nant prices five times. However, Market Dominant volumes have declined year over year. These de- clines, along with stakeholder con- cerns, prompted the PRC to initiate another review of the ratemaking system in April 2024. NALC partici- pated in the initial review, and will likely do so again in the current re- view. The second is a docket examining the implementation of the Postal Service’s 10-year plan, the Deliver- ing for America plan, published in 2021. Three years into the imple- mentation of the plan, the Postal Service is busy redesigning sig- nificant parts of its network. How- ever, USPS is facing pushback from lawmakers, customers and mailers over service declines related to the redesign. Notably, customers expe- rienced significant mail delays in the rollout of one of the first region- al processing and delivery centers in Richmond, Atlanta and Houston. The PRC has opened a docket in April 2024 to examine these ser- vice issues. The PRC ordered USPS to request an advisory opinion from the regulator to ensure that the net- work changes will not substantially affect service quality nationwide, or explain why such a review is un- necessary. NALC is monitoring this docket and will submit comments if deemed necessary. The research staff also monitors research published by the USPS OIG and provides summaries and insights on reports relevant to NALC issues. Some reports of note in the last two years were: “Election Mail Readiness for the 2022 Mid-Term Elections”; “Changes in Mail Mix: Implications for Carriers’ Physical Health”; “Safety and Health Pro- gram Training”; “Postal Service Non-Career Turnover Follow-up”; “Historical Analysis of USPS Retire- ment Fund Returns”; “U.S. Postal
tiree and Federal Employees’ Com- pensation Act cost-of-living adjust- ments (COLAs) stand each month. To provide letter carriers with a vi- sual representation of the progress toward a COLA, the department up- dates a CPI graph on NALC’s web- site. The line graph shows the CPI index readings since the start of the contract, the most recently pub- lished CPI, and the CPI number that would generate a future COLA. When actual contract COLA amounts are calculated by USPS, based on the January and July CPI releases, the department indepen- dently reviews the amounts to en- sure that they are correct. The department also maintains and updates the Civil Service Re- tirement System and the Federal Employees Retirement System an- nuity projection tables that are in- cluded in The Postal Record and on the NALC website. Past pay tables, COLA memos and annuity projec- tions can be found on the NALC website. Analysis of PRC and USPS OIG reports The department works to analyze and interpret reports and studies from the PRC, the USPS OIG and other independent bodies. The research staff reviews and summarizes annual reports and supporting materials filed at the PRC. These reports include the PRC’s financial analysis of USPS fi- nancial results and 10-K Statement, the PRC’s Annual Compliance De- termination, and the PRC’s Analysis of the Postal Service’s Annual Per- formance Report and Performance Plan. The department also monitors other parties’ filings with the PRC to determine if they may be of interest to NALC. NALC is closely monitoring two dockets and may file comments. The first is a review of the PRC’s ratemaking system for Market Dominant products. This follows a change in the system after the PRC
The Postal Record 49 August 2024 In terms of the delivery labor mar- ket, over the last five years, Amazon has hired almost 300,000 delivery workers, making its in-house deliv- ery workforce nearly the size of the Service’s Response to Mail Theft”; and “Postal Service Hiring Practic- es.” The information gathered from these reports helps to inform union decisions and can provide useful evidence for our case in collective bargaining and interest arbitration. NALC also provides input on re- ports produced about the USPS. In the past two years, the USPS OIG has reached out to NALC officers and staff seeking input on reports about heat safety, turnover, the design of sort- ing and delivery centers, how chang- es in mail mix have affected carriers’ jobs, and the OT Admin tool. Industry trends The Research Department also monitors major developments in the delivery industry and looks for trends that might affect the work of city carriers in the future. First, the department is always tracking the development of Ama- zon’s in-house delivery network and its impact on the parcel market and delivery jobs. In the last two years, Amazon has had to reduce its operat- ing expenses by shrinking its distri- bution network after over-investing in new facilities during the pan- demic. Amazon closed, canceled or delayed more than 160 buildings in 2022 and 2023. Despite this reduc- tion in the size of its network, Ama- zon continued to increase its share of the parcel market. Amazon’s par- cel delivery volume increased 15.7 percent between 2022 and 2023. In 2023, for the first time ever, Amazon delivered more packages than UPS. It had already surpassed FedEx’s annual volume in 2020. However, Amazon’s 2023 volume of 5.9 billion parcels is still shy of the Postal Ser- vice’s 6.6 billion parcels, though the distance is closing. It is important that the Postal Service maintain its market share to protect letter carrier jobs.
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