United States Postal Service

FY2019 

Annual 

Report to 

Congress

FY2019 Annual Report

FY2019 Comprehensive 

Statement of Postal Operations

FY2019 Performance Report 

 FY2020 Performance Plan
508-01/06/2020-mw

An Automated Guided Vehicle (AGV), one 

of the Postal Service’s latest technological 

mail processing inventions, moves mail in a 

Processing and Distribution Center.
FY2019 Annual Report to Congress — United States Postal Service iii

Contents 

Report Structure and Purpose 1

FY2019 Annual Report 1

Letter from the Postmaster General and USPS Board of Governors Chairman 2

United States Postal Service Board of Governors . . . . . . . . . . . . . . . . . . . . . . .4

FY2019 Comprehensive Statement of Postal Operations 7

Overview of Postal Service Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Key Financial and Operating Statistics 11

Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17

FY2019 Performance Report and FY2020 Performance Plan 18

Corporate-Wide Goals and Targets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

High-Quality Service 21

Excellent Customer Experiences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23

Safe Workplace and Engaged Workforce . . . . . . . . . . . . . . . . . . . . . . . . . . .26

Financial Health 28

Strategic Initiatives 36

Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38

Trademarks 38

Year References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38
A postal worker places parcels 

on the Small Delivery Unit Sorter 

(SDUS) machine for processing at 

the Centreville, VA, Post Office.
FY2019 Annual Report to Congress — United States Postal Service 1

Report Structure and Purpose

This document consists of the following four reports:

 The Fiscal Year (FY)1

 2019 Annual Report, including 

a statement from the USPS Postmaster General 

and USPS Board of Governors Chairman on our2

operations.



1 All references to a specific year or “the year” refer to the Postal Service fiscal year 

ending Sept. 30, 2019. However, specific month and year references pertain to 

the calendar dates. 2 The terms “we,” “us” and “our” refer to the United States Postal Service.

The FY2019 Comprehensive Statement of Postal 

Operations.

 The FY2019 Annual Performance Report.

 The FY2020 Annual Performance Plan.

This document’s purpose is to provide information to 

stakeholders. The document fulfills the requirements of 

the following articles in United States Code Title 39:

 414(f), on the reporting of financial information 

related to special postage stamps (p.8).

 416(f), on the reporting of information related to 

semipostal stamps (p.8).

 2401(e), on the submission of a Comprehensive 

Statement (pp.7–17).

 2402, on the submission of an Annual Report 

(pp.1–6).

 2803, on the submission of an Annual Performance 

Plan (pp.18–35).

 2804, on the submission of an Annual Performance 

Report (pp.18–35).

 3652(g), on the submission of the Comprehensive 

Statement, Annual Performance Report and Annual 

Performance Plan (pp.7–35).

 3686(d), on the reporting of executive compensation 

in excess of Federal Level Executive 1 (p.17).

FY2019 Annual Report

Financial and Operational Highlights

Totals at Sept. 30, 2019 Percent change

FY2019 FY2018 FY2017 FY2019 FY2018

(in millions, except percentages)

Mail volume 142,570 146,402 149,590 (2.6)% (2.1)%

Total revenue with investment and interest income $ 71,306 $ 70,783 $ 69,694 0.7% 1.6%

Total expenses1 $ 80,119 $ 74,696 $ 72,436 7.3% 3.1%

Net loss $ (8,813) $ (3,913) $ (2,742) 125.2% 42.7%

Purchases of capital property and equipment $ 1,419 $ 1,409 $ 1,344 0.7% 4.8%

Debt $ 11,000 $ 13,200 $ 15,000 (16.7)% (12.0)%

Capital contributions of U.S. Government $ 3,132 $ 3,132 $ 3,132 0.0% 0.0%

Deficit since 1971 reorganization $ (74,664) $ (65,769) $ (61,856) (13.5)% (6.3)%

Total net deficiency $ (71,532) $ (62,637) $ (58,724) (14.2)% (6.7)%

(in actual units indicated, unaudited)

Number of career employees 496,934 497,157 503,103 (0.04)% (1.2)%

Number of non-career employees 136,174 137,290 141,021 (0.8)% (2.6)%

Total delivery points 159,901,312 158,558,256 157,328,676 0.8% 0.8%

New delivery points served 1,343,056 1,229,580 1,234,496 9.2% (0.4)%

1 Includes interest expense
2 United States Postal Service — FY2019 Annual Report to Congress

Letter from the Postmaster General and USPS Board of Governors Chairman

The United States Postal Service delivers for the 

American public. With every business, mailbox, and 

doorstep we visit, we bind the nation together by 

providing prompt, reliable, and efficient mailing and 

shipping services.

As you review this report, you will see that the 

Postal Service is a $71 billion business structured by 

Congress. We compete for every customer across each 

of our product lines. We pay for our operations entirely 

through the sale of postal products and services and 

do not receive tax revenues to support our business. If 

we were a private sector company, the Postal Service 

would rank 44th in the 2019 Fortune 500.

 We live, work, and serve in every community in 

America. We operate more than 31,000 Post 

Offices; 204,274 delivery vehicles, and more than 

8,500 pieces of automated processing equipment; 

and we work with approximately 58,000 retail 

partners and other access points. On a typical day, 

our 633,000 employees physically process and 

deliver 471 million mailpieces to nearly 160 million 

delivery points. For much of rural America, we are 

often the only delivery option. We deliver 48 percent 

of the world’s mail volume and more packages to 

the home than any other business. According to a 

2019 survey by the Pew Charitable Trusts, the Postal 

Service with its 90 percent favorability rating is the 

best-liked federal government agency.

 We deliver for the American economy. The Postal 

Service maintains and continually strengthens mail as 

a powerful marketing and communications channel.

By delivering bills, statements, correspondence, 

catalogs, and a wide range of marketing materials, 

we connect businesses with American consumers.

To companies in nearly every economic sector — 

including retail, health care, real estate, and financial 

services — we are a strategic and closely aligned 

business partner. We are a major part of the 

nation’s financial infrastructure, facilitating millions of 

transactions daily for virtually every commercial entity 

in America.

 We are a driver of America’s rapidly expanding 

e-commerce sector. The Postal Service enables 

retailers and e-tailers — no matter their size or 

geographical location — to grow their businesses 

and meet rising consumer delivery expectations.

Our unparalleled last-mile resources ensure universal 

access to online goods and services. Continual 

product and service innovation and new business 

solutions for America’s shippers have propelled 

growth in our package revenues and in the broader 

package shipping sector.

 We are leveraging information and technology to 

transform the delivery experience. Our new digital 

offerings — such as Informed Delivery — are 

powered by an amazing digital infrastructure that 

processes approximately 3 billion scan records daily 

and 700,000 images hourly to deliver digital mail 

content to more than 20 million subscribers while 

also providing a wealth of real-time information to our 

customers and employees about the movement of 

mail through our network.

However, while the Postal Service is a fundamentally 

strong organization — in terms of the value we 

deliver to our customers and the role we play in the 

economy — we are not financially strong. In fiscal 

year 2019, the Postal Service recorded a net loss of 

$8.8 billion.

Revenues continue to be pressured by the ongoing 

erosion of mail volumes. Because mail services 

account for nearly 63 percent of our revenues, this 

ongoing decline puts significant financial strain on the 

organization. To meet universal service obligations, 

our network infrastructure costs are largely fixed or are 

growing as we add approximately 1 million delivery 

points each year. We are also subject to inflationary 

pressures and legislative mandates, particularly with 

regard to employee and retiree benefits.

While aggressive management actions have generated 

new revenue — principally in an expanding package 

business — and generated cost savings and 

productivity gains, the Postal Service’s business model 

is broken and will only produce widening losses in the 

coming years, absent dramatic changes.
FY2019 Annual Report to Congress — United States Postal Service 3

Our problems are serious but solvable. Through 

legislation, regulatory reforms, and other measures, 

we can stabilize our financial condition and return the 

organization to a sustainable business model. Our 

recent success in supporting negotiations to reform 

international terminal dues rates within the Universal 

Postal Union demonstrates that solutions to difficult 

policy problems can be achieved.

Ahead lies the hard work of reshaping the organization 

to meet the future needs of the nation. In the coming 

year, we will work with our stakeholders including 

Congress, the Administration, the Postal Regulatory 

Commission, customers, unions, and others to 

determine the policies and business strategies 

necessary to put the Postal Service on a financially 

sustainable path.

As we do so, we know we must also build upon the 

strengths of today’s Postal Service to ensure that it 

continues to bind the nation together and serve as an 

engine of economic growth.

On behalf of the men and women of the Postal 

Service — who take great pride in serving the nation 

and our customers reliably, securely, affordably, and 

universally — we hope you find this report informative 

and useful.

Thank you for your interest in the United States Postal 

Service.

Megan J. Brennan

Postmaster General and Chief Executive Officer

Robert M. Duncan

Chairman, Board of Governors
4 United States Postal Service — FY2019 Annual Report to Congress

United States Postal Service Board of Governors

The Board of Governors of the United States Postal 

Service is comparable to a board of directors of a 

publicly held corporation. The Board normally consists 

of up to nine Governors appointed by the President of 

the United States with the advice and consent of the 

Senate.

The nine Governors select the Postmaster General, 

who becomes a member of the Board, and those 10 

select the Deputy Postmaster General, who also serves 

on the Board. The Postmaster General serves at the 

pleasure of the Governors for an indefinite term, and the 

Deputy Postmaster General serves at the pleasure of 

the Governors and the Postmaster General.

As of Sept. 30, 2019, the Board consisted of five 

appointed Governors, the Postmaster General, and the 

Deputy Postmaster General.

Robert M. Duncan, 

USPS Board of 

Governors Chairman

Robert M. Duncan’s 

appointment to the 

Postal Service Board of 

Governors by President 

Donald Trump was 

confirmed by the Senate 

in August 2018. Duncan, 

of Kentucky, served 

the remainder of a seven-year term that expired on 

Dec. 8, 2018, and is currently in his hold-over year 

that expires Dec. 8, 2019. Duncan is nominated to 

serve another seven-year term expiring Dec. 8, 2025, 

and awaits Senate confirmation. Duncan was elected 

chairman of the Board of Governors on Sept. 13, 2018.

Duncan served as chairman of the Compensation and 

Governance Committee and chairman of the Audit 

and Finance Committee from September 2018 to 

September 2019.

Duncan is also chairman of the board of trustees at 

Alice Lloyd College, a private four-year liberal arts 

college in Pippa Passes, Kentucky, and chairman and 

CEO of the Inez Deposit Bank in Inez, Kentucky. In 

2017, Duncan was named the 17th chairman of the 

President’s Commission on White House Fellowships.

Duncan is a former chairman of the board of directors 

of the Tennessee Valley Authority and former chairman 

of the Republican National Committee.

David C. Williams, 

USPS Board of 

Governors Vice 

Chairman

David C. Williams’ 

appointment to the 

Postal Service Board of 

Governors by President 

Donald Trump was 

confirmed by the Senate 

in August 2018. Williams, 

a native of Illinois, is serving the remainder of a sevenyear term expiring Dec. 8, 2019. He was elected vice 

chairman of the Board of Governors on Sept. 13, 

2018. Williams was a member of the Audit and Finance 

Committee from September 2018 to September 2019.

Williams is also a distinguished professor at the Schar 

School of Government and Policy at George Mason 

University in Arlington, Virginia and a fellow with the 

National Academy for Public Administration.

Williams is a former Inspector General of the United 

States Postal Service and former vice chair of the 

Government Accountability and Transparency Board.

John M. Barger, 

Governor

John M. Barger was 

appointed to the Postal 

Service Board of 

Governors by President 

Donald Trump and 

was confirmed by the 

Senate on Aug. 1, 

2019. Barger will serve 

for the remainder of a 

term that expires Dec. 8, 2021. Barger is chairman of 

the Compensation and Governance Committee and 

a member of the Strategy and Innovation Committee 

since September 2019.
FY2019 Annual Report to Congress — United States Postal Service 5

Barger is also managing director of NorthernCross 

Partners, an investment and advisory firm, and serves 

as a director on a number of company boards, 

including those involved in e-commerce, logistics and 

supply chain, data analytics, digital visualization, and 

electronic displays.

Barger served as a board member of the Los Angeles 

County Employees Retirement Association (LACERA) 

for seven years, including as chairman of the board of 

retirement and board of investments.

Ron A. Bloom,

Governor

Ron A. Bloom was 

nominated to serve 

on the Postal Service 

Board of Governors by 

President Donald Trump 

and was confirmed by the 

Senate on Aug. 1, 2019.

Bloom will serve the 

remainder of a seven-year 

term that expires Dec. 8, 2020. Bloom is chairman of 

the Strategy and Innovation Committee and a member 

of the Audit and Finance Committee since September 

2019.

Bloom is also with Brookfield Asset Management, 

where he serves as vice chairman and managing 

partner. As part of his work at Brookfield, he serves 

on the board of directors of Westinghouse Electric 

Company and Clarios.

Bloom is a former vice chairman, U.S. Investment 

Banking, Lazard.

Roman Martinez IV, 

Governor

Roman Martinez IV 

was appointed to the 

Postal Service Board of 

Governors by President 

Donald Trump and 

was confirmed by the 

Senate on Aug. 1, 2019.

Martinez will serve for the 

remainder of a seven-year 

term that expires Dec. 8, 2024. Martinez is chairman 

of the Audit and Finance Committee and member of 

the Compensation and Governance Committee since 

September 2019.

Martinez also serves on the board of directors of Cigna 

Corporation; on the board of trustees of New YorkPresbyterian Hospital; and on the board of overseers of 

the International Rescue Committee.

Martinez is a former vice chairman of the Investment 

Advisory Council of the State Board of Administration 

of Florida and former managing director, Lehman 

Brothers.

Megan J. Brennan, 

USPS Postmaster 

General and Chief 

Executive Officer

Megan J. Brennan is the 

74th and the first female 

Postmaster General of 

the United States and the 

Chief Executive Officer of 

the world’s largest postal 

organization.

Appointed by the Governors of the Postal Service, 

Brennan began her tenure as Postmaster General in 

February 2015. In the prior four years, Brennan served 

as chief operating officer and executive vice president 

of the Postal Service, and held prior roles as vice 

president of both Eastern Area and Northeast Area 

operations. Brennan began her 33-year Postal Service 

career as a letter carrier in Lancaster, Pennsylvania.

Brennan earned a Master of Business Administration 

degree as a Sloan Fellow at the Massachusetts Institute 

of Technology. She is also an alumna of Immaculata 

College in Pennsylvania.

Ronald A. Stroman, 

USPS Deputy 

Postmaster General and 

Chief Government 

Relations Officer

Ronald A. Stroman was 

named the 20th Deputy 

Postmaster General 

(DPMG) in March 2011.

As the second-highest 

ranking Postal Service 

executive, he serves on the Postal Service Board 

of Governors and on Postmaster General Megan J. 

Brennan’s Executive Leadership Team.
6 United States Postal Service — FY2019 Annual Report to Congress

Stroman had more than 30 years of professional 

experience in government, legislative affairs, and 

leadership before becoming DPMG. From 1978 to 

1984, he was an attorney with the Department of 

Housing and Urban Development. He then moved to a 

position as counsel on the Judiciary Committee of the 

U.S. House of Representatives. He also worked for the 

Committee on Government Operations and became 

a minority staff director and counsel for the House 

Committee on Oversight and Government Reform.

In 1997, Stroman took a director’s position with the 

U.S. Department of Transportation. In 2001, he joined 

the General Accounting Office as managing director 

for the Office of Opportunity and Inclusiveness. He 

returned to the House in 2009, where he served as 

staff director, Committee on Oversight and Government 

Reform, before joining the Postal Service.

Stroman earned his Juris Doctorate from Rutgers 

University Law Center.

A USPS customer 

drops off a pre-paid 

Click-N-Ship package 

at a Post Office.
FY2019 Annual Report to Congress — United States Postal Service 7

FY2019 Comprehensive Statement of Postal Operations

Overview of Postal Service Operations

In accordance with the provisions of the Postal 

Reorganization Act (PRA), the United States Postal 

Service began operations July 1, 1971, succeeding 

the cabinet-level Post Office Department established 

in 1792. The PRA established us as an “independent 

establishment of the executive branch of the 

Government of the United States” with the mandate to 

offer a “fundamental service” to the nation “at fair and 

reasonable rates.”

Mission 

According to Title 39 of the United States Code, “The 

United States Postal Service shall be operated as a 

basic and fundamental service provided to the people 

by the Government of the United States, authorized 

by the Constitution, created by an Act of Congress, 

and supported by its people. The Postal Service shall 

have as its basic function the obligation to provide 

postal services to bind the Nation together through 

the personal, educational, literary, and business 

correspondence of the people. It shall provide prompt, 

reliable and efficient services to patrons in all areas and 

shall render postal services to all communities.”

Services 

We fulfill our legal mandate to provide universal 

services at fair and reasonable prices by offering a 

variety of postal services to our many customers.

Although the Postal Accountability and Enhancement 

Act (PAEA) classifies our services as Market-Dominant 

and Competitive “products,” the term “services” is 

often used in this report for consistency with other 

descriptions of services we offer. Our services include 

the following:

 First-Class Mail. Services include the delivery 

of letters, postcards, correspondence, bills or 

statements of account, and payments.

 Marketing Mail. Services include: the delivery of 

advertisements and marketing packages weighing 

less than 16 ounces, that are not required to be sent 

using First-Class Mail.

 Shipping and Packages. Services include: 

First-Class Parcel Service Commercial for highvolume shippers of packages that weigh less than 

16 ounces; First-Class Parcel Service Retail for 

shipment of boxes, thick envelopes or tubes of 13 

ounces or less; Parcel Services for merchandise or 

printed matter, such as library and media mail; Parcel 

Select “last-mile” delivery services; Parcel Return; 

Priority Mail for 1-3 day specified (non-guaranteed) 

delivery; and Priority Mail Express for an overnight, 

money-back guaranteed service that includes 

tracking, proof of delivery, and basic insurance up to 

$100.

 International Mail and Shipping. Services include 

Priority Mail Express International and Priority Mail 

International, which compete in the e-commerce 

cross-border business with more than 180 countries, 

and Global Express Guaranteed, which offers 

reliable, date-certain delivery in 1-3 business days to 

major markets.

 Periodicals. Services include the delivery of 

newspapers, magazines, and newsletters.

 Post Office Box, Money Orders, and Other 

Services. These domestic and international services 

include: PO Boxes, which provide customers an 

additional method for mail delivery that is private and 

convenient; Money Orders, which offer customers 

a safe, convenient, and economical method for 

the remittance of payments; USPS Extra Services, 

which offer a variety of service enhancements that 

provide security, proof of delivery or loss recovery 

(e.g. Certified Mail, Registered Mail, Signature 

Confirmation, Adult Signature, and insurance up to 

$5,000) and are available online, at Post Offices or at 

Automated Postal Centers (self-service kiosks); and 

other retail services, including the sale of philatelic 

products, packaging materials, special occasion 

cards, and gift cards.

Services are sold at 31,322 Postal Servicemanaged Post Offices, stations, and branches, plus 

approximately 3,300 additional Contract Postal Units, 

Community Post Offices, Village Post Offices, and a 

large network of commercial outlets that sell stamps 

and services on our behalf and through our website 

www.usps.com. Mail deliveries are made to more than 

160 million city, rural, PO Box, and highway delivery 
8 United States Postal Service — FY2019 Annual Report to Congress

points. We aim to make our retail locations convenient, 

accessible, and cost-effective through planning and 

construction of new facilities and renovations of existing 

facilities.

In fulfilling our universal service obligation, we provide 

services to patrons in all areas and communities in the 

United States. We serve rural areas, communities, and 

small towns where Post Offices are not financially selfsustaining. We use a variety of transportation methods 

to move mail through this large network, including 

highway and air transportation.

Postal Rates

Postal rates are established to be fair, equitable and 

affordable. Prices and fees are reviewed and approved 

by our Governors and subject to a review process by 

the Postal Regulatory Commission (PRC). In FY2019, 

our retail price of $0.55 for a First-Class Mail 1-ounce 

stamp continued to be the most affordable postal rate 

among all posts in industrialized nations.

Global Bargain*

$0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0

Italy

First-Class Letter Prices

United States

Australia

Germany

Canada

United Kingdom

France

$1.10 Mean price

$0.55

$0.70

$0.75

$0.79 

$0.79

$0.79

$1.03

$3.40

* Postage prices for domestic standard letters are adjusted for Purchasing 

Power Parity (PPP). Exchange rates are as of May 10, 2019. PPP adjustment 

from International Monetary Fund is indexed to the U.S. Dollar.

We offer two categories of services, which are classified 

for regulatory purposes as Market-Dominant services 

and Competitive services. Market-Dominant services 

account for approximately 66 percent of our annual 

operating revenues. Such services include, but are not 

limited to, First-Class Mail, Marketing Mail, Periodicals, 

and certain parcel services. Price increases for these 

services are currently generally subject to a price cap 

based on the Consumer Price Index for All Urban 

Consumers (CPI-U). We implemented price increases 

on certain Market-Dominant services that averaged 2.5 

percent in January 2019, 1.9 percent in January 2018, 

and 0.9 percent in January 2017.

Competitive services, such as Priority Mail, Priority Mail 

Express, First-Class Package Service, Parcel Select, 

Parcel Return Service and some types of International 

mail, are not limited by a price cap. By law, the price for 

each Competitive service must cover its “attributable 

costs” (meaning the Postal Service’s costs attributed 

to such service through reliably identified causal 

relationships), and Competitive services collectively 

must contribute an appropriate share to the institutional 

costs of the Postal Service, currently 8.8 percent, as 

determined by the PRC. In general, we attempt to 

set our prices for Competitive services at rates that 

maximize revenue. Prices for Competitive services 

increased an average of 7.4 percent, 4.1 percent, 

and 3.9 percent in January 2019, January 2018, and 

January 2017, respectively.

Unlike some other shippers, the Postal Service does 

not add surcharges for fuel, residential delivery, or 

regular Saturday or holiday season delivery.

Semipostal Stamps 

The U.S. Postal Service has statutory authority to issue 

and sell semipostal fundraising stamps. Semipostal 

stamps are postage stamps with a postage value equal 

to the First-Class Mail single-piece, 1-ounce stamp 

rate in effect at the time of purchase, plus an amount 

to fund a designated cause. By law, revenue from 

sales of semipostal stamps, less the postage paid and 

the reasonable costs incurred by the Postal Service, 

is distributed to designated agencies to support the 

particular cause.

Semipostal stamps may be either congressionally 

mandated or issued under the discretionary authority 

granted to the U.S. Postal Service through the 

Semipostal Authorization Act, Pub. L. 106-253. Under 

this act, the U.S. Postal Service may issue and sell 

semipostal fundraising stamps to advance such causes 

as it considers to be “in the national public interest and 

appropriate.” The law specifies that the U.S. Postal 
FY2019 Annual Report to Congress — United States Postal Service 9

Service can issue up to five new semipostal fundraising 

stamps over a 10-year period, with each stamp to be 

sold for no more than two years. In November 2017, 

the Alzheimer’s semipostal stamp was issued and will 

be followed by the Healing PTSD semipostal stamp to 

be issued in December 2019.

In FY2019, we sold three semipostal stamps, the 

congressionally mandated Breast Cancer Research

semipostal stamp, the congressionally mandated Save 

Vanishing Species semipostal stamp (through Dec. 31, 

2018), and the Alzheimer’s semipostal stamp issued 

under the U.S. Postal Service’s discretionary authority.

The Breast Cancer 

Research semipostal 

stamp generated 

approximately $2.07 

million in funds in excess 

of the postage value in 

FY2019. We deducted 

approximately $5,000 for 

costs in connection with 

these stamps in FY2019.

The Postal Service 

distributed approximately 

$1.4 million (70 percent) 

to the National Institutes 

of Health within the 

Department of Health 

and Human Services and approximately $620,000 (30 

percent) to the Breast Cancer Research Program within 

the Department of Defense.

The Save Vanishing 

Species semipostal 

stamp generated 

approximately $307,000 

in funds in excess of the 

postage value in 

FY2019. This stamp was 

dedicated Sept. 20, 

2011, and removed from 

sale Dec. 31, 2018, 

during which a total of 

$5.7 million in funds was raised. We did not deduct any 

costs in connection with these stamps in FY2019. All of 

the funds collected in excess of the postage value were 

given to the U.S. Fish and Wildlife Service to support its 

Multinational Species Conservation Fund.

The Alzheimer’s

semipostal stamp helps 

raise funds to fight 

Alzheimer’s disease. In 

FY2019, the sale of the 

Alzheimer’s stamp 

generated approximately 

$365,000 in funds in 

excess of the postage 

value. We did not deduct 

any costs in connection 

with these stamps in 

FY2019. Net proceeds 

were distributed to the 

National Institute on Aging within the U.S. Department 

of Health and Human Services.

Sustainability 

The Postal Service is committed to making a positive 

impact in the communities and environments in which 

we serve. We are Putting our Stamp on a Greener 

Tomorrow by taking sustainable actions throughout our 

organization and focusing on integrating environmental 

business practices into our day-to-day operations.

Solar power. A big step in our continued use of solar 

power is the 10-megawatt solar power generation 

system at the Los Angeles mail processing facility 

consisting of nearly 35,000 solar panels. This unique 

system generates outlease revenue for the Postal 

Service and also saves future costs by locking in 

lower rates now. Four more revenue-generating solar 

installations are planned for 2020.

Hydrogen fuel cells. The Postal Service replaced 

standard lead acid batteries in powered industrial 

vehicles (PIVs) at the Washington, D.C., mail processing 

facility with hydrogen fuel cells. PIVs are used to move 

mail and equipment throughout USPS facilities. The 

hydrogen fuel cell technology improves safety and 

workplace productivity while reducing greenhouse gas 

emissions.

Recycled materials. Our Priority Mail and Priority Mail 

Express corrugated cardboard boxes are recyclable 

and meet Sustainable Forestry Initiative or Forest 

Stewardship Council Certification standards.

National Recycling Operation. Equipment and 

recycling operations are standardized to optimize 

efficiency. Recycling also reduces trash disposal 
10 United States Postal Service — FY2019 Annual Report to Congress

costs by “right-sizing” trash services as volumes are 

diverted from landfills to recycling facilities. In addition 

to cost savings, the National Recycling Operation 

increases revenue by optimizing the value of recycled 

items such as mixed paper and corrugated cardboard 

through consolidation. The program uses our existing 

transportation network to backhaul recyclables, 

particularly mixed paper, from our Post Offices to 

central collection hubs for consolidation. This diverts 

waste from landfills without using extra fuel for 

transporting the materials.

Additional information on the Postal Service’s 

sustainability efforts is included in the 2018 Annual 

Sustainability Report, available at usps.com/green.

Commitment to a Safe and Secure Network to 

Prevent Illicit Drug Distribution and Delivery 

The Postal Service, in conjunction with the Postal 

Inspection Service, is firmly committed to eliminating 

the distribution of illicit drugs through the mail and has 

worked for decades to combat the use of its network to 

facilitate illicit drug distribution. Through the increased 

use of technology, sharing of data between USPS 

and foreign posts, improved interdiction processes 

and working closely with our partners including the 

Department of Homeland Security, U.S. Customs and 

Border Protection, and other federal law enforcement 

agencies, we will continue to investigate criminal activity 

and fight the trafficking of illicit drugs.

Public Opinion 

Public interest and opinion of our organization remain 

strong. In a poll released in September 2019, the Pew 

Research Center found that 90 percent of Americans 

held a favorable opinion of the Postal Service, a higher 

rating than any other federal government agency3.

3 Public Expresses Favorable Views of a Number of Federal Agencies. 

(2019, October 1). Retrieved from people-press.org/2019/10/01/public-expresses-favorable-views-of-a-number-of-federal-agencies/

Additionally, an April 2019 Gallup Poll found that three in 

four Americans (74 percent) rated the job performance 

of the organization as “excellent” or “good,” placing 

the United States Postal Service as the highest rated 

governmental agency4

4 Saad, L. (2019, September 4). Postal Service Still Americans’ Favorite Federal 

Agency. Retrieved from news.gallup.com/poll/257510/postal-service-americans-favorite-federal-agency.aspx.

. The Postal Service has achieved 

this top ranking every year Gallup has measured it 

(2014, 2017, and 2019).

Commitment to Diversity 

The Postal Service was ranked the top federal agency 

for multicultural business opportunities for the eighth 

consecutive year by Omnikal, a social media and 

networking organization. The Postal Service received 

the 2019 Omni50 Award for its efforts to do business 

with companies led by women and minorities and for 

supporting opportunities for small businesses and 

entrepreneurs5.

5 Omni50 Top Government Agencies: USPS: SBA: Defense Dept. (2019, February 

19). Retrieved from omnikal.com/2019/02/announcing-americas-top-25-government-agencies-for-multicultural-business-opportunities-2-2
FY2019 Annual Report to Congress — United States Postal Service 11

Key Financial and Operating Statistics

Financial History Summary

(in millions)

FY2019 FY2018 FY2017

Operating results

1 $ 71,154 $ 70,660 $ 69,636

Operat

Total revenue

ing expenses

Compensation and benefits2 47,519 46,525 45,634

Retirement benefits3 6,197 5,877 6,132

Retiree health benefits 4,564 4,481 4,260

Workers’ compensation 3,504 4 (797)

Transportation 8,184 7,861 7,238

All other operating expenses 9,911 9,697 9,743

Loss from operations $ (8,725) $ (3,785) $ (2,574)

Investment and interest income (expense), net (88) (128) (168)

Net loss $ (8,813) $ (3,913) $ (2,742)

Financial position

Cash and cash equivalents4 $ 8,795 $ 10,061 $ 10,513

Property and equipment, net 14,352 14,616 14,891

All other assets 2,486 2,011 1,990

Total assets $ 25,633 $ 26,688 $ 27,394

Retiree health benefits $ 47,205 $ 42,641 $ 38,160

Workers’ compensation liability 18,529 16,409 17,910

Debt 11,000 13,200 15,000

Retirement benefits 8,385 5,707 3,306

All other liabilities 12,046 11,368 11,742

Total liabilities $ 97,165 $ 89,325 $ 86,118

Total net deficiency $ (71,532) $ (62,637) $ (58,724)

1 Includes other non-operating income such as sale of land and buildings, sale of miscellaneous equipment, and sale of motor vehicles.

2 Excludes FERS normal costs, amortization of unfunded retirement benefits, retiree health benefits and workers’ compensation.

3 Includes FERS normal costs and amortization of unfunded retirement benefits.

4 Cash and cash equivalents are unrestricted.
12 United States Postal Service — FY2019 Annual Report to Congress

Revenue, Pieces, and Weight Statistics

(in millions of units indicated; FY2019 revenue audited)

FY2019 FY2018 FY2017

First-Class Mail1

Revenue $ 24,434 $ 24,948 $ 25,689

Number of pieces 54,943 56,712 58,834

Weight, pounds 2,780 2,869 2,867

Marketing Mail2

Revenue $ 16,359 $ 16,512 $ 16,626

Number of pieces 75,653 77,270 78,329

Weight, pounds 6,917 7,402 7,577

Shipping and Packages3

Revenue $ 22,787 $ 21,467 $ 19,529

Number of pieces 6,165 6,149 5,758

Weight, pounds 12,693 12,118 10,887

International Mail

Revenue $ 2,466 $ 2,630 $ 2,614

Number of pieces 855 941 1,001

Weight, pounds 476 504 501

Periodicals

Revenue $ 1,194 $ 1,277 $ 1,375

Number of pieces 4,635 4,994 5,301

Weight, pounds 1,572 1,744 1,922

U.S. Postal Service Mail4

Number of pieces 285 293 322

Weight, pounds 102 114 106

Free Matter for the Blind5

Number of pieces 34 43 45

Weight, pounds 12 15 20

Other services – revenue5 $ 3,896 $ 3,788 $ 3,760

Postal Service totals

Operating revenue $ 71,136 $ 70,622 $ 69,593

Number of pieces 142,570 146,402 149,590

Weight, pounds 24,552 24,766 23,880

Note: We have reclassified the totals for certain mail categories in prior years to conform to classifications used in the current year.

1 Excludes First-Class Mail Parcels.

2 Excludes Marketing Mail Parcels.

3 See Shipping and Packages and Other Services Statistics table on the following page.

4 No revenue is received or recorded for this category of mail.

5 By law, the Postal Service is required to offer below-cost postage prices to certain categories of mailers including blind individuals. Congress 

reimbursed the Postal Service for revenue it had forgone by offering these below-cost postage prices.
FY2019 Annual Report to Congress — United States Postal Service 13

Note: We have reclassified the totals for certain 

mail categories in prior years to conform to 

classifications used in the current year.

1 Includes First-Class Mail Parcels, First-Class 

Package Services - Retail, and First-Class 

Package Services - Commercial.

2 USPS Retail Ground (formerly Standard Post) 

is a non-expedited, retail-only product and is 

classified as Competitive (as is our expedited 

Priority Mail service). Even though USPS Retail 

Ground is priced identically to Priority Mail for 

Zones 1-4, its service standards are not identical 

since it is not an expedited service.

Shipping and Packages and Other Services Statistics

(in millions of units indicated; table unaudited)

FY2019 FY2018 FY2017

Priority Mail Express

Revenue $ 716 $ 752 $ 766

Number of pieces 26 28 30

Weight, pounds 28 30 33

First-Class Packages1

Revenue $ 4,466 $ 3,878 $ 3,353

Number of pieces 1,398 1,279 1,157

Weight, pounds 532 497 455

Priority Mail2

Revenue $ 9,730 $ 9,342 $ 8,717

Number of pieces 1,097 1,085 1,045

Weight, pounds 2,938 2,837 2,542

Parcel Select Mail and Marketing Mail Parcels

Revenue $ 6,850 $ 6,451 $ 5,707

Number of pieces 2,947 3,026 2,837

Weight, pounds 7,716 7,182 6,347

Parcel Return Service Mail

Revenue $ 203 $ 220 $ 183

Number of pieces 75 89 69

Weight, pounds 199 229 195

Package Services

Revenue $ 822 $ 824 $ 803

Number of pieces 622 642 620

Weight, pounds 1,280 1,343 1,315

Total shipping and packages

Revenue $ 22,787 $ 21,467 $ 19,529

Number of pieces 6,165 6,149 5,758

Weight, pounds 12,693 12,118 10,887

Other services

Certified Mail

Revenue $ 654 $ 678 $ 672

Number of articles 187 198 201

Return Receipts

Revenue $ 314 $ 327 $ 340

Number of articles 138 144 147

USPS Tracking

Revenue $ 1 $ 1 $ 1

Number of articles 5,422 5,338 4,951

PO Box Services revenue $ 1,037 $ 999 $ 964

Money Orders

Revenue $ 148 $ 147 $ 147

Number of articles 81 83 87

Insurance

Revenue $ 78 $ 79 $ 74

Number of articles 14 15 15

Shipping and mailing supplies

Revenue $ 107 $ 109 $ 109

Number of articles 53 54 55

Miscellaneous other services revenue $ 1,557 $ 1,448 $ 1,453

Total other services revenue $ 3,896 $ 3,788 $ 3,760
14 United States Postal Service — FY2019 Annual Report to Congress

Post Offices and Delivery Points

(in actual units indicated, unaudited)

FY2019 FY2018 FY2017

Post Offices, stations, and branches

Postal Service-managed

Post Offices 26,362 26,365 26,410

Classified stations, branches, and carrier annexes 4,960 4,959 4,967

Total Postal Service-managed 31,322 31,324 31,377

Contract Postal Units 2,175 2,240 2,331

Village Post Offices 667 743 821

Community Post Offices 449 465 476

Total offices, stations, and branches 34,613 34,772 35,005

Residential delivery points

City 83,739,561 83,279,977 82,855,611

Rural 44,425,454 43,591,733 42,805,252

PO Box 15,985,189 15,960,945 15,954,141

Highway Contract 3,001,015 2,959,424 2,924,386

Total residential delivery 147,151,219 145,792,079 144,539,390

Business delivery points

City 7,734,259 7,709,827 7,690,284

Rural 1,707,145 1,673,267 1,639,505

PO Box 3,226,893 3,301,930 3,379,418

Highway Contract 81,796 81,153 80,079

Total business delivery 12,750,093 12,766,177 12,789,286

Total delivery points 159,901,312 158,558,256 157,328,676

Change in delivery points 1,343,056 1,229,580 1,234,496

Number of Routes by Type of Delivery

(in actual units indicated, unaudited)

FY2019 FY2018 FY2017

City

Route

142,672 143,358 143,937

Rural 79,404 78,737 75,433

Highway Contract Route 9,731 9,748 9,810

Total 231,807 231,843 229,180
FY2019 Annual Report to Congress — United States Postal Service 15

Postal Vehicle Inventory

(in actual units indicated, unaudited)

Vehicle type FY2019 FY2018 FY2017

Delivery and collection (0.5–2.5 tons) 204,274 208,133 205,997

Mail transport (tractors and trailers) 5,481 5,566 5,379

Mail transport (5–11 tons)1 3,460 2,389 2,080

Administrative and other 6,925 7,196 7,507

Service (maintenance) 5,858 6,398 7,034

Inspection Service and law enforcement 2,942 2,920 2,942

Total 228,940 232,602 230,939

1 Previously referred to as Mail transport (3-9 tons)

Real Estate Inventory

(in actual units indicated, unaudited)

Real estate inventory FY2019 FY2018 FY2017

Owned properties 8,393 8,362 8,448

Owned interior square feet 193,355,127 192,842,955 191,745,056

Leased properties 23,118 23,147 23,184

Leased interior square feet 79,027,452 79,047,136 78,335,141

GSA1/other government properties 292 294 285

GSA/other government interior square feet 1,792,744 1,797,769 1,839,972

1 General Services Administration.

Real Estate Inventory Actions

(in actual units indicated, unaudited)

Real estate inventory actions FY2019 FY2018 FY2017

Lease actions (alternate quarters, new leases and renewals) 4,410 4,667 3,927

Property disposals1 8 14 18

New construction2 76 77 69

Repair and alteration projects 59,864 58,653 53,694

Repair and alteration expense project totals (in thousands, rounded) $ 240,000 $ 215,000 $ 217,000

Repair and alteration capital projects 4,428 4,464 4,598

Repair and alteration capital project totals (in thousands, rounded) $ 519,000 $ 483,400 $ 389,500

1 Total partial and complete property sales (does not include non-property sales such as right-of-ways/easements, sale of rights, defaults, installment payments, 

etc.).

2 Includes the build-out of pre-existing spaces that the Postal Service did not previously own (alternate quarters), the new construction of leased or owned 

space, and the expansion of existing spaces.
16 United States Postal Service — FY2019 Annual Report to Congress

Employees

(actual numbers, unaudited)

FY2019 FY2018 FY2017

Headquarters and HQ-related employees

Headquarters 3,311 3,254 3,252

Headquarters – field support units 3,447 3,491 3,581

Inspection Service – field 2,441 2,389 2,439

Inspector General 1,031 1,029 1,067

Total HQ and HQ-related employees 10,230 10,163 10,339

Field employees

Area offices 946 899 825

Postmasters/installation heads 13,729 13,742 13,641

Supervisors/managers 25,581 25,590 25,281

Professional administration and technical personnel 4,752 4,672 4,580

Clerks (including nurses) 121,573 121,622 128,256

Mail handlers 36,939 37,535 39,307

City delivery carriers 166,343 168,199 166,569

Motor vehicle operators 8,742 8,411 8,147

Rural delivery carriers – full-time 73,165 70,852 69,462

Building and equipment maintenance personnel 29,751 30,219 31,366

Vehicle maintenance employees 5,183 5,253 5,330

Total field employees 486,704 486,994 492,764

Total career employees 496,934 497,157 503,103

Non-career employees

Casuals 849 879 922

Postal support employees 26,251 26,386 26,823

Non-bargaining temporary 339 285 304

Rural part-time 58,224 59,183 59,655

Postmaster relief and leave replacements 2,021 2,168 2,368

City carrier assistant 42,121 42,115 44,486

Mail handler assistant 6,369 6,274 6,463

Total non-career employees 136,174 137,290 141,021

Total employees 633,108 634,447 644,124
FY2019 Annual Report to Congress — United States Postal Service 17

Executive Compensation

Federal law requires us to provide compensation and 

benefits to employees at a level comparable to the 

private sector. We continue to pursue this goal for all 

of our employees. In addition, we support, develop, 

and provide a wide range of tools and development 

resources that assist employees in reaching their full 

potential.

The Board establishes executive officer compensation 

and benefits, subject to the requirements and 

limitations of federal law. Although our governing law 

provides that executives should be compensated at a 

level comparable to the private sector, we do not have 

the resources to achieve this level of compensation.

Compensation for our executive officers remains 

significantly below that of similarly-ranked senior 

executives in the private sector.

In most circumstances, we cannot compensate 

our executives more than the rate for Level 1 of the 

Executive Schedule ($210,700 in Calendar Year 2018).

Under certain programs, we can award bonuses or 

other rewards, which raise the level of compensation 

beyond this limit; however, compensation is still limited 

by federal law.

Performance-based payments for FY2017 were paid 

in Calendar Year 2018. Performance-based payments 

were determined when there was only a single 

Governor appointed by the President and confirmed by 

the Senate.

In accordance with legal reporting requirements, the 

accompanying table reports Calendar Year 2018 

compensation information, including our executives 

compensated in excess of Federal Executive Level 1 

in Calendar Year 2018 and the amount of bonus or 

other payments that caused pay to exceed Level 1 

of the Executive Schedule in Calendar Year 2018.

The terms “bonus or other payment” in the second 

column of the table are statutory terms that represent 

various amounts which are part of an executive’s total 

compensation; these amounts are predicated on 

the Postal Service’s maintenance of a performance 

appraisal system that makes meaningful distinctions 

based on relative performance.

CY2018 Bonus or 

Other Payment

CY2018 Reportable 

Earnings in Excess 

of CAP I

Megan J

Executive Name

. Brennan $ 80,795 $ 80,795

Robert Cintron 757 645

Joshua D. Colin 9,983 9,871

Joseph Corbett 49,337 49,337

Guy J. Cottrell 9,589 9,477

Gregory G. Graves 9,609 9,497

Luke T. Grossmann 9,820 6,328

Jeffrey C. Johnson 10,995 10,766

Linda M. Malone 757 645

Thomas J. Marshall 57,566 57,566

Kevin L. McAdams 757 155

Shaun E. Mossman 9,381 9,269

Abelardo P. Munoz Jr. 10,123 7,750

Sharon D. Owens 9,883 7,829

Edward F. Phelan Jr. 8,009 7,897

Tom A. Samra 757 645

Kristin A. Seaver 60,190 60,189

Jacqueline K. Strako 34,382 34,382

Ronald A. Stroman 70,993 70,993

Douglas A. Tulino 9,069 8,957

David E. Williams Jr. 49,268 49,268

Jeffrey C. Williamson 47,277 47,277

Note: Legislation requires reporting compensation in the last full calendar year. 

This timeframe does not align with our fiscal year, which is from October 1 to 

September 30.
18 United States Postal Service — FY2019 Annual Report to Congress

FY2019 Performance Report 

and FY2020 Performance Plan

Corporate-Wide Goals and Targets

The Postal Service is a self-supporting, independent 

federal agency and the only delivery service that 

reaches every address in the United States. Everyone 

living in the United States and its territories — 

regardless of their location — has access to postal 

products and services and pays the same price for a 

First-Class postage stamp.

The Postal Service puts information and technology 

at the center of its business strategies. We are 

speeding the pace of innovation, developing mobile 

and digital tools to play a larger role in the daily digital 

lives of customers, and using one of the world’s most 

advanced tracking and information systems to speed 

the flow of mail and packages throughout our network.

We leverage the information derived from our robust 

scanning and tracking systems to add value to the 

senders and receivers of mail and packages — and to 

create new products and services, spurring growth in 

the mailing industry.

We continue to play an indispensable role as a driver 

of commerce and as a provider of delivery services 

that connects Americans to one another — reliably, 

affordably, and securely — and to every residential and 

business address.

To provide reliable, efficient, trusted, and affordable 

universal delivery service, we established the following 

four strategic areas of focus:

 Deliver a World-Class Customer Experience

 Equip, Empower, and Engage Employees

 Innovate Faster to Deliver Value

 Invest in our Future Platforms

To assess our efforts in achieving these strategies, we 

measure our performance through progress against 

corporate performance outcomes as follows:

 High-Quality Service

 Excellent Customer Experiences

 A Safe Workplace and Engaged Workforce

 Financial Health

For each of these outcomes, the following subsections 

describe both the outcomes and measures used 

to assess our progress, provide a report of our 

performance in FY2019, and give our plan for FY2020, 

including indicator targets. The following table shows 

our performance from FY2016-FY2019 and our targets 

for FY2019-FY2020 for each outcome.

These targets are aligned with the FY2020 Integrated 

Financial Plan (IFP), which includes our planned revenue 

and expenses for FY20206

6 The FY2020 IFP information contained in this document will be revised if needed 

upon approval by the BOG.

. Every fiscal year, we 

develop a budget and plan intended to be sufficient for 

our field offices to meet their non-financial performance 

outcomes. We design all of our corporate-wide targets 

to be achievable given the planned finances in the IFP.

We measure “Controllable Income (Loss)” as one of 

our indicators for the outcome “Financial Health.” 

This measure is based on planned expenditures and 

revenues for every program activity (i.e., budget item 

contributing to controllable income [loss]) outlined in the 

IFP. Controllable income (loss) is a non-GAAP (United 

States generally accepted accounting principles) 

measure defined as total revenue less controllable 

expenses and one-time accounting adjustments.

Controllable expenses consist of compensation and 

benefits; transportation; depreciation; supplies and 

services; and rent, utilities, and other controllable 

expenses. They do not include non-controllable 

expenses, discussed in detail later in this document. In 

the subsection “Controllable Income (Loss),” we provide 

the planned revenues and expenditures for FY2020.

This plan yields a target controllable loss for FY2020, 

which is our target for the FY2020 IFP, for the reasons 

discussed in that subsection.
FY2019 Annual Report to Congress — United States Postal Service 19

A USPS driver stands in front of a USPS truck.

In the day-to-day operation of our business, we 

focus on costs within our control, such as salaries 

and transportation. We calculate controllable income 

(loss) by excluding items we cannot control, such as 

Postal Service Retiree Health Benefits Fund (PSRHBF) 

actuarial revaluation and amortization expenses, 

workers’ compensation expenses caused by actuarial 

revaluations and discount rate changes, retirement 

expenses caused by actuarial revaluations, and 

adjustments for non-recurring items, such as the 2016 

change in accounting estimate for deferred revenueprepaid postage. Controllable income (loss) should not 

be considered a substitute for net income (loss) and 

other GAAP reporting measures.

We developed the budget in the IFP to be consistent 

with our planned work hours, which are used in the 

calculation of the targets for the measure “Deliveries per 

Total Work Hours, Percent Change.”
20 United States Postal Service — FY2019 Annual Report to Congress

FY2016–FY2019 Results and FY2019–FY2020 Targets for Corporate-wide Performance Outcomes

Corporate 

Performance 

Outcome Measure

FY2020 

Target

FY2019 

Actual

FY2019 

Target

FY2018 

Actual

FY2017 

Actual

FY2016 

Actual

High-Quality 

Service1

Single-Piece First-Class Mail

Two-day 96.50 92.05 96.50 93.78 94.72 94.66

Three-to-five-day 95.25 80.88 95.25 82.48 85.57 83.66

Presort First-Class Mail

Overnight 96.80 95.46 96.80 96.00 96.46 96.16

Two-day 96.50 94.10 96.50 94.92 95.58 95.05

Three-to-five-day 95.25 91.95 95.25 91.96 93.16 91.68

First-Class Mail Letter and Flat Composite (FCLF)2 96.00 92.02 96.00 92.07 93.29 92.34

Marketing Mail and Periodicals Composite3 91.80 89.25 91.80 89.26 91.44 90.01

Excellent 

Customer 

Experiences

Customer Experience Composite Index4 75.73 69.04 78.27 67.47 88.30 87.62

Business Service Network (BSN) 96.73 96.68 96.73 95.90 96.25 95.13

Point of Sale (POS) 90.42 87.77 90.42 87.98 88.53 86.38

Delivery 86.33 80.40 86.33 80.47 83.22 76.26

Customer Care Center (CCC)5 55.00 46.94 55.00 39.19 86.80 85.18

Enterprise Customer Care (eCC)6 55.00 37.45 70.00 36.73 3.78 5.19

Large Business Panel NA NA NA 72.34 76.75 75.88

USPS.com7 72.58 72.94 65.00 57.54 NA NA

Business Mail Entry Unit (BMEU)7 96.01 96.00 95.13 95.33 NA NA

Safe Workplace 

and Engaged 

Workforce

Total Accident Rate 15.00 14.19 15.00 15.09 15.43 16.09

Engagement Survey Response Rate8 51% 38% 51% 42% 46% 30%

Financial 

Health

Controllable Income (Loss) ($ in billions) (4.00)9 (3.42) (3.10) (1.95) (0.81) 0.61

Deliveries per Total Work Hours, Percent Change 1.509 (0.60) 1.40 (0.50) (0.50) 0.10

Note: NA indicates that either no data was collected or no target was set for the relevant indicator and year.

1 The Postal Service is providing nonpublic service performance data for certain competitive products as part of the Nonpublic Annex in the Annual Compliance Report proceeding 

conducted by the Postal Regulatory Commission.

2 For our FY2016-FY2019 actuals and FY2019-FY2020 targets, we report the First-Class Mail Letter and Flat (FCLF) Composite in lieu of the First-Class Composite, which we 

reported in previous Annual Reports to Congress. FCLF Composite does not include First-Class Mail parcels. FCLF Composite numbers are based on the externally-measured 

quarterly service performance data that we file with the PRC pursuant to Part 3055 of Title 39 of the Code of Federal Regulations; they do not include mitigating factors used 

internally for compensatory purposes. Additionally, service measurement adjustments altered one previously reported end-of-year actual (FY2017 First-Class Mail Letter and 

Flat Composite), which is accurately reflected in this table.

3 For our FY2016-FY2019 actuals and FY2019-FY2020 targets, we report the Marketing Mail and Periodicals Composite in lieu of Standard Composite, which we reported in 

previous Annual Reports to Congress.

4 In FY2019, the Customer Experience Composite Index was based on BSN, POS, Delivery, CCC, eCC, USPS.com, and BMEU. Reference the United States Postal Service FY2018 

Annual Compliance Review response to question 6d in the Chairman’s Information Request No. 2 for historical Customer Experience-related comparability information on the 

PRC’s website: prc.gov/dockets/document/108111

5 The FY2019 actual score and FY2020 target are based on satisfaction with both live agents and our Interactive Voice Response telephone system, while the FY2016-FY2018 

actuals are based on satisfaction with live agents only.

6 The FY2018-FY2019 actual scores and FY2020 target are based on overall customer satisfaction with the resolution quality received and year-to-date overall satisfaction 

improvement as compared to the same period last year, while the FY2016-FY2017 actuals were based on the percentage of cases that were reopened.

7 The USPS.com and BMEU performance indicators were added to the Customer Experience Composite Index in FY2018.

8 In FY2016-FY2019 and for the FY2020 target, we used the Postal Pulse survey. For further explanation see page 27.

9 The FY2020 IFP information contained in this document will be revised if needed upon approval by the BOG.
FY2019 Annual Report to Congress — United States Postal Service 21

High-Quality Service

The Postal Service is committed to “...bind the Nation 

together through the personal, educational, literary, 

and business correspondence of the people. [We] 

shall provide prompt, reliable and efficient services to 

patrons in all areas and shall render postal services to 

all communities” (Title 39 CFR). This forms the core of 

our operations.

To measure our performance relative to our mission, we 

evaluate our delivery service performance continuously 

using Service Performance Measurement (SPM). This 

internal measurement system provides data from the 

time mail is deposited in a Postal Service facility to 

when a USPS employee delivers it at a home, business 

or PO Box.

We operate a highly complex network of distribution 

and delivery facilities interconnected by multiple modes 

of transportation across the country. We measure 

service performance at the product level against 

specific service standards. The integrated nature 

of our network and the commingling of products 

during processing and delivery results in operational 

performance being reflected across multiple products at 

the same time and to varying degrees.

Our annual service performance measures are reported 

as a cumulative score throughout the year and are 

volume weighted. Service performance during the first 

half of the year — when mail volume is highest — sets 

the pace for the remainder of the year.

Below we describe the categories of mail standards 

that we use to gauge service performance.

Single-Piece First-Class Mail. The measures for 

Single-Piece First-Class Mail represent the performance 

of Single-Piece First-Class Mail letters, postcards, and 

flats throughout the fiscal year. The indicators show 

the estimated percent of total mail by service standard 

(two-day and three-to-five-day) that was delivered to 

customers on time.

Presort First-Class Mail. The measures for 

Presort First-Class Mail represent the performance 

of commercial presorted First-Class Mail letters, 

postcards, and flats delivered throughout the fiscal year.

The indicators show the estimated percent of total mail 

by service standard (overnight, two-day and three-tofive-day) that was delivered on time.

First-Class Mail Letter and Flat Composite. The 

First-Class Mail Letter and Flat (FCLF) Composite 

category is the weighted average of the performance 

of Single-Piece First-Class Mail and Presort First-Class 

Mail across all service standards, weighted by volume.

Marketing Mail and Periodicals Composite. The 

Marketing Mail and Periodicals Composite category is 

a composite indicator of the percent of all Marketing 

Mail and Periodicals that were delivered within the 

service standard established during the year. This 

includes Marketing Mail letters, Marketing Mail flats, and 

Periodicals. Approximately two-thirds of mail volume 

in this composite is Marketing Mail letters, while the 

remainder is Marketing Mail flats and Periodicals.

FY2019 Performance Report

The following table includes both FY2019 Actual 

Scores and FY2019 Targets for our High Quality Service 

metrics.

Metric

FY2019 

Actual 

Score

FY2019 

Target

Delta 

(pp1)

FY2019 

Target 

(Met/

Not Met)

Single-Piece FirstClass Mail Two-Day 92.05 96.50 (4.45) Not Met

Single-Piece FirstClass Mail Three-toFive-Day

80.88 95.25 (14.37) Not Met

Presort First-Class 

Mail Overnight 95.46 96.80 (1.34) Not Met

Presort First-Class 

Mail Two-day 94.10 96.50 (2.40) Not Met

Presort First-Class 

Mail Three-to-FiveDay91.95 95.25 (3.30) Not Met

First-Class Mail Letter 

and Flat Composite 92.02 96.00 (3.98) Not Met

Marketing Mail and 

Periodicals Composite 89.25 91.80 (2.55) Not Met

1 PP refers to the percentage point difference between FY2019 Actual Scores and 

FY2019 Targets.

While we did not meet any of the service performance 

targets in FY2019, service performance scores 

improved in all mail classes during the third and fourth 

quarters of FY2019. Some mail classes — such as 

Marketing Mail — performed at best-ever performance 

levels for much of the fourth quarter.
22 United States Postal Service — FY2019 Annual Report to Congress

During FY2019, natural disasters and industrial 

incidents negatively disrupted the network and 

contributed to a lower level of service performance.

These disruptions included hurricanes, tropical storms, 

wildfires, an unusually large number of named winter 

storm events, toxic spills (e.g. mercury), and a malicious 

actor that inducted multiple improvised explosive 

devices into the network.

Aside from unforeseen weather events that impacted 

our network, our analysis on causes for service failures 

identified that transportation failures accounted for 

nearly half of all failures in FY2019. Transportation 

failures took many forms, including mail that was timely 

in departing initial processing but did not arrive at the 

final processing or delivery facility within our established 

service standards. In other instances, failures were 

caused by delays by the operator, traffic delays, or 

mechanical, mis-routing, or missed connections within 

the transportation network.

Our analysis also revealed that processing failures 

occurred when processing did not finalize within the 

service standard in areas such as staffing, operational 

window, and machine downtime. In other instances, 

process failures occurred when a product was 

processed out of first-in, first-out (FIFO) order.

To address processing failures, operational window 

and machine downtime were identified as areas of 

focus. We implemented Lean Mail Processing within 

our processing facilities and developed digital run 

plan generator systems for daily machine operational 

plan production cycles. This effort standardized 

machine scheduling and utilization and provided senior 

management with additional oversight.

Last-mile or delivery failure was another area that 

contributed to service failure. Delivery failure occurred 

when a mail piece was processed on time but delivered 

after the expected delivery date. To reduce delivery 

failure, headquarters subject matter experts conducted 

National Service Reviews of field operations to improve 

service performance at local levels. We identified 

deficiencies and communicated with unit, district, and 

area management with individualized remediation plans.

The Delivery Operations team identified issues at the 

unit level and held district teleconferences with area 

management to highlight needed improvements at the 

unit level.

Reference the FY2016–FY2019 Results and FY2019–

FY2020 Targets for Corporate-Wide Performance 

Outcomes table on page 20 for historical 

performance and FY2020 targets.

FY2020 Performance Plan

In FY2020, all service performance targets will remain 

the same as in the previous year. As such, each 

FY2020 metric will be comparable to FY2019 metrics.

We assessed and analyzed our operations in 

processing, transportation and delivery and developed 

plans to address service failures. To improve 

processing, we will continue to use efforts that were 

implemented in FY2019. We will continue to use digital 

run plan generator systems for production of daily 

machine operational plans. In addition, we will use the 

electronic Mail Condition Visualization tool to provide 

improved reporting 

and management 

of product on hand 

to drive cycle time 

improvement. We will 

continue to focus on 

Lean Mail Processing 

certification efforts 

within our processing 

facilities to improve 

product flow, signage, 

and layouts throughout 

facilities to drive 

efficiencies and ensure 

FIFO processes.

In September 2019, 

we created two new 

vice president positions 

to increase senior 

leadership’s focus 

on transportation 

and mail processing 

operations. The new 

Vice President of 

Logistics position leads the effort to improve our air 

and surface transportation network. The new Vice 

President of Processing and Maintenance Operations 

will lead processing operations, operations integration 

and support, international processing operations, and 

maintenance operations. These duties previously were 

the responsibility of the Vice President of Network 

Operations.

The new handheld Mobile 

Delivery Device (MDD), which 

will be rolled out nationally 

in FY2020, provides letter 

carriers additional operational 

information to better serve our 

delivery customers.
FY2019 Annual Report to Congress — United States Postal Service 23

In FY2019, transportation accounted for nearly half 

of all service failures. To address these failures in 

FY2020, we will redesign our Surface Transportation 

Center (STC) network, a critical transportation network 

for more than half of all First-Class Mail volume, to 

improve product flow within our ground network. The 

redesign will allow management to optimize network 

routing, improve ground reach, and eliminate many 

of our lowest performing trips for all services. These 

enhancements are expected to primarily improve 

our three-to-five day services, with more modest 

improvements for our two-day services. The first 

milestone in this redesign began with the opening of a 

new STC in Kansas City, Missouri, on Sept. 23, 2019.

The next phases of the STC redesign will occur in 

the second and third quarters of FY2020 to minimize 

network disruptions during peak season.

In FY2020, we will continue to identify issues resulting 

in delivery failures at the unit level. We will achieve this 

by doing the following:

 Communicating visualizations of Standard Operating 

Procedures and Standard Work Orders.

 Retraining employees on using SPM to identify 

defects for remediation.

 Communicating data and root causes through a new 

analytics visualization tool. The tool enables data 

to be assembled by a select operational group to 

reduce cycle time from mail induction to delivery.

 Continue the national level process initiative to 

replicate best practices from Area and District Lean 

Six Sigma and Kaizen projects.

Building on our experiences in FY2019 managing 

weather-related and industrial incident disruptions, we 

will further refine contingency planning to mitigate and 

reduce negative impacts to our service. We will launch 

a new initiative in FY2020 called “Disruptive Events” to 

identify mail affected by unforeseen events outside of 

management’s control. This initiative will use data to 

identify and flag mail pieces impacted by unexpected 

events, such as weather, outside of the Postal Service’s 

control. The Disruptive Events program will enable us 

to more accurately quantify impacts from these events 

and diagnose service failures.

Reference the FY2016–FY2019 Results and FY2019–

FY2020 Targets for Corporate-Wide Performance 

Outcomes table on page 20 for historical 

performance and FY2020 targets.

Excellent Customer Experiences

Excellent customer experience is foundational to the 

Postal Service’s success. To evaluate our customer’s 

satisfaction with the services we provide, customers 

are surveyed at every primary interaction point. We refer 

to these interactions as “touchpoints.” The Customer 

Experience composite measurement system provides a 

comprehensive view of the customer experience across 

the most frequently used postal customer contact 

channels and is measured as a composite index of 

component survey scores. The measure — Customer 

Experience (CX) Composite Index — is comprised 

of component surveys of each customer touchpoint 

and measures the aggregate variance of customer 

satisfaction scores across each touchpoint relative to its 

respective performance target.

To calculate the FY2019 CX Composite score, we 

multiply each customer touchpoint score by its 

respective weighting and sum the total. This total 

represents the CX Composite score for the year. In 

previous years, the weighted average of customer 

satisfaction raw scores was totaled to create the CX 

Composite Index. This change will enable us to better 

incent performance improvements appropriate for each 

touchpoint.

The components of the CX Composite Index are 

described below:

Business Service Network (BSN) survey. The BSN 

provides nationwide support to qualified business 

customers on service issues, information and requests.

The BSN survey measures businesses’ overall 

satisfaction with their BSN account representatives in 

resolving issues. The national weighting of the BSN 

score used to calculate the CX Composite Index is 

10 percent.

Point of Sale (POS) survey. The POS survey measures 

customers’ overall satisfaction with their experiences 

at retail locations. The national weighting of the POS 

score used to calculate the CX Composite Index is 

15 percent.

Delivery survey. The Delivery survey measures the 

overall satisfaction of residential and small/medium 

business customers’ delivery experience, including both 

street addresses and PO Box deliveries. The national 

weighting of the Delivery score used to calculate the CX 

Composite Index is 20 percent.
24 United States Postal Service — FY2019 Annual Report to Congress

Customer Care Center (CCC) survey. The CCC 

survey measures customer satisfaction with calls made 

to customer care centers. The national weighting of the 

CCC score used to calculate the CX Composite Index 

is 20 percent.

Enterprise Customer Care (eCC) survey. The eCC 

survey measures resolution satisfaction of customers 

who file complaints with the Postal Service. For eCC, 

we measure overall satisfaction as well as the overall 

satisfaction improvement rate over same-period-lastyear (FY2018). The national weighting of the eCC score 

used to calculate the CX Composite Index is 20 percent 

[the overall eCC score is a composite score of the eCC 

overall satisfaction score (50 percent) and the eCC 

improvement rate (50 percent) as compared to the 

same period last year].

USPS.com survey. The USPS.com survey measures 

customer satisfaction with the USPS website and 

solicits customer opinion of website elements. The 

national weighting of the USPS.com score used to 

calculate the CX Composite Index is 5 percent.

Business Mail Entry Unit (BMEU) survey. The BMEU 

survey measures commercial mailers’ experiences with 

their overall satisfaction and customer opinion of BMEU 

employees, the service they received, and suggestions 

for areas of improvement. The national weighting of the 

BMEU score used to calculate the CX Composite Index 

is 10 percent.

All FY2019 Customer Experience metrics will be 

comparable to FY2020. For historical FY2018-FY2016 

Customer Experience-related comparability information, 

reference the United States Postal Service FY2018 

Annual Compliance Review response to question 6d of 

Chairman’s Information Request No. 27.

7 prc.gov/dockets/document/108111

FY2019 Performance Report

The following table includes both FY2019 Actual 

Scores and FY2019 Targets for our Excellent Customer 

Experience metrics.

Metric

FY2019 

Actual 

Score

FY2019 

Target Delta (pp)

FY2019 

Target 

(Met/

Not Met)

CX Composite Index 69.04 78.27 (9.23) Not Met

BSN 96.68 96.73 (0.05) Not Met

POS 87.77 90.42 (2.65) Not Met

Delivery 80.40 86.33 (5.93) Not Met

CCC 46.94 55.00 (8.06) Not Met

eCC 37.45 70.00 (32.55) Not Met

USPS.com 72.94 65.00 7.94 Met

BMEU 96.00 95.13 0.87 Met

In FY2019, we noted an improvement in our overall 

CX Composite Score (69.04 percent) from FY2018 

(67.47 percent) and improvements in five of our 

seven CX touchpoint scores, but still did not meet our 

composite score target of 78.27 percent.

We continued to evolve and improve our measurement, 

reporting and evaluation of our customers’ experiences 

with our organization in FY2019. We identified 

additional opportunities to assess improvements in 

customer experience and modified our measures to 

better reflect customer satisfaction improvements made 

throughout the fiscal year (e.g. the addition of the eCC 

improvement rate). Additionally, we evaluated each 

existing survey for effectiveness in both delivery to the 

broadest surveyed representation and measurement of 

overall customer satisfaction.

USPS.com and BMEU met their FY2019 targets. BSN, 

POS, Delivery, CCC, and eCC did not achieve their 

respective FY2019 targets. Of these five components, 

the two primary contributors for missing the overall 

CX Composite score target were the eCC and CCC 

metrics because the composite score is a weighted 

average of all seven metrics. Of note, the CCC score 

achieved in FY2019 noted dramatic improvements over 

the previous fiscal year.

The following sections address FY2019 actual scores, 

FY2019 targets, accomplishments achieved throughout 

the year, and other related information for each CX 

touchpoint metric.

BSN survey. In FY2019, we achieved a score of 

96.68 percent, slightly lower than our target of 

96.73 percent. BSN customers identified issue 

resolution as their primary issue. In FY2019, we 

expanded the follow-up process for all Areas and 

Districts to ensure customers are satisfied with 

the issue resolution process. To drive employee 
FY2019 Annual Report to Congress — United States Postal Service 25

A USPS letter carrier stands in front 

of a ProMaster 2500 vehicle.

engagement, we recognized BSN representatives 

who regularly demonstrated behaviors that influence a 

positive customer experience.

POS survey. In FY2019, we achieved a score of 

87.77 percent, lower than our target of 90.42 percent.

We did not meet our fiscal year target largely due to 

longer than expected customer wait times in line.

Throughout the fiscal year, we deployed Sales and 

Services Associate (SSA) training to improve SSAs’ 

knowledge of products and services and to understand 

and apply CX best practices.

Delivery survey. In FY2019, we achieved a score of 

80.40 percent, lower than our target of 86.33 percent.

Our underperformance relative to the FY2019 target 

was due to delivery accuracy and unclear package 

pickup locations. Additional service disruptions 

including weather, fire, and natural disasters throughout 

the year adversely impacted our ability to deliver highquality service.

CCC survey. In FY2019, we achieved a score of 

46.94 percent, lower than our target of 55.00 percent.

The primary root causes identified by customers were 

wait times before speaking to a USPS representative 

and the inability to resolve their issues at first contact 

with the CCC.

While the CCC actual score did not meet its FY2019 

target, performance increased by 20 percentage points 

in overall satisfaction from the first month of the year to 

the last month of the year. To achieve this improvement, 

the Postal Service focused on bettering operational 

performance, which reduced the need for customers to 

contact the CCC. Additionally, the CCC provided better 

self-service options and shortened wait times in line.

eCC survey. In FY2019, we achieved a score of 

37.45 percent, considerably lower than our target of 

70.00 percent. The primary reasons customers cited 

were that their issues were not adequately resolved 

and that they were not contacted quickly by case 

managers.

To help resolve these issues throughout the fiscal year, 

we trained more than 70,000 employees and rolled out 

a state-of-the-art customer relationship management 

system. The new system simplifies the case 

management process by providing field operations with 

a one-stop solution to resolve customer issues.

USPS.com survey. In FY2019, we achieved a score 

of 72.94 percent, exceeding our target of 65 percent.

To address customer concerns and improve the 

customer digital experience, we implemented a series 

of redesigns for important USPS.com web pages 

including the Home, Help, FAQs, and Missing Mail 

web pages to provide users with new interfaces 

and improved functionality. Further, we implemented 

enhancements to the USPS.com search function 

to improve our customers’ ability to find relevant 

information online.

BMEU survey. In FY2019, we achieved a score of 

96.00 percent, exceeding our target of 95.13 percent.

Customers cited issue resolution and positive employee 

attitudes as the two primary drivers of satisfaction. To 

drive improvement throughout the year, we identified 

opportunities for coaching, mentoring and training to 

ensure our employees had the appropriate resources 
26 United States Postal Service — FY2019 Annual Report to Congress

to meet our customers’ needs. As an example, we 

provided bi-weekly training on issue resolution that 

enabled our employees to deliver superior issue 

resolution performance. We improved our performance 

monitoring system and enhanced awareness of BMEU 

satisfaction with area management.

FY2020 Performance Plan

In FY2020, delivering excellent customer experiences 

across multiple channels will continue to be a priority 

for the United States Postal Service. This includes 

improving the way we engage with customers, making 

it easier for our employees to deliver excellent customer 

services, and enhancing how we measure customer 

experiences. Across all channels, we will strive to 

increasingly provide all customers with the experience 

they want.

In FY2020, we will include the same touchpoints as the 

FY2019 CX Composite Index and their weighted values 

in the Index.

We will continue to emphasize our commitment to 

improve our customers’ experiences. Customer 

experience will remain a strategic initiative. We will 

emphasize leadership’s commitment to improve 

customer experience and coordinate organizational 

efforts to improve both the customer experience itself 

and the organization’s measurement of customer 

experience.

We believe that having the broadest representation 

possible of our customers is important. Consequently, 

we are expanding our survey respondent pool.

Specifically, the Delivery experience survey will be 

fielded to a larger sample and, to improve response 

rate, customers will now be able to provide feedback 

both online and through physical channels. These 

changes will provide more actionable data, which will 

allow our employees to improve delivery service.

We plan to improve our ability to empower our 

workforce to prevent undesirable customer experiences 

in FY2020 by providing enhanced tools and data on 

customer data, and better training and support to our 

employees across the organization.

Reference the FY2016–FY2019 Results and FY2019–

FY2020 Targets for Corporate-Wide Performance 

Outcomes table on page 20 for historical 

performance and FY2020 targets.

Safe Workplace and Engaged Workforce

Employee Safety

Employee safety is a top priority for the Postal 

Service. For the fifth consecutive year, we reduced 

total accidents. Prevention is the guiding principle 

for occupational safety and health legislation and the 

underlying philosophy of the USPS Safety Program.

To avoid accidents and occupational diseases, we 

have adopted standard requirements for safety 

and health protection at the workplace and have 

established compliance protocols to ensure effective 

implementation.

Risk assessment and management are fundamental 

to preventing and controlling risks to safety and health 

in the workplace. This includes accounting for all 

relevant risks, checking the efficiency of the safety 

measures adopted, documenting the outcomes of 

the assessment, and reviewing and updating the 

assessment regularly.

Our safety performance is measured by using a 

total accident rate metric. The total accident rate is 

calculated by multiplying the total number of accidents 

for the year by the approximate number of annual 

work hours per employee (2,000), multiplied by 100.

This number is then divided by the annual number of 

exposure hours. The total accident rate formula is:

Total Number of Accidents x 200,000 ___________________________________________

Exposure Hours

This rate uses the same calculation developed by the 

Occupational Safety and Health Administration (OSHA) 

for OSHA Illness and Injury (I&I) rates but expands 

it to include accidents that do not result in medical 

expenses, days away from work, or restrictions from 

performing full duty. Using the total accident rate is 

an industry best practice that enables us to design 

targeted prevention strategies to eliminate accidents 

and reduce the severity of impact on both the employee 

and the organization.

FY2019 Performance Report

In FY2019, our total accident rate was 14.19, which 

was better than our target of 15.00. Total accidents for 

FY2019 decreased more than 7.2 percent compared 

with FY2018. The following table includes both FY2019 

Actual Scores and FY2019 Targets for our corporate 

safety metric.
FY2019 Annual Report to Congress — United States Postal Service 27

Metric

FY2019 

Actual 

Score

FY2019 

Target Delta

FY2019 

Target 

(Met/

Not Met)

Total Accident Rate 14.19 15.00 (0.81) Met

We were able to meet our FY2019 target by launching 

a Safety Intervention and Recognition program that 

tracked district-level performance each month. Any 

district identified as having a high accident rate or 

showing a trend toward an increasing accident rate 

was targeted for intervention. The program required 

the district to create an action plan that identified 

root cause(s) and implement activities to mitigate the 

hazards associated with these accidents. Proactive 

leadership engagement resulted in a safer work 

environment.

In FY2019, the Postal Service implemented a 

new safety database, the Informed Mobility Safety 

Observation Tool, that automated data and response 

input from safety-related workplace observations.

Previous observations were recorded on paper and led 

to unsafe behaviors being overlooked or unaddressed.

The implementation of the automated quality safety 

observations helped prevent accidents in FY2019.

The table below shows accidents by type in FY2019 

and FY20188.

8 FY2018 accident counts by type differ from the FY2018 Annual Report to 

Congress due to either coding changes or additional claims being submitted after 

Sept. 30, 2018 (the end of FY2018).

Accident Count by Type

FY2019 FY2018 Percent Change

OS

Accident Type

HA I&I 29,214 32,779 (10.88)%

Non-Recordable 53,464 56,392 (5.2)%

Motor Vehicle1 28,790 30,017 (4.09)%

Total 82,678 89,171 (7.28)%

1 Motor vehicle accidents are included in both the OSHA I&I and non-recordable 

accident counts.

FY2020 Performance Plan

The FY2020 target for the total accident rate is 15.00.

To achieve this, the Postal Service will continue to 

focus on prevention and a proactive approach to safety 

through efforts designed to address the most frequent 

hazards of the workplace such as dog bites, extreme 

weather, distracted driving, and slip, trip, and fall 

injuries.

We will also focus on the importance of leadership, 

tools, and awareness training in maintaining a culture 

of safety. Improved tools will be released for field 

leadership to analyze and forecast their accident 

trends to implement proactive efforts at the earliest 

time possible. Early intervention within our processing 

facilities and Post Offices will allow us to establish 

effective accident reduction action plans with the 

cooperation and support of our employees.

We will also leverage delivery management systems to 

get a better understanding of motor vehicle accident 

risks, such as unsafe behaviors and dangerous roads.

In FY2020, we will roll out a national slip, trip, and fall 

campaign designed to increase awareness of these 

hazards and enlist the support of our customers in 

preventing these types of accidents.

Reference the FY2016–FY2019 Results and FY2019–

FY2020 Targets for Corporate-Wide Performance 

Outcomes table on page 20 for historical 

performance and FY2020 targets.

Employee Engagement

The Postal Service aims to provide employees 

with an engaged workplace, one in which teams, 

individuals, and leaders thrive and perform at high 

levels. Research shows that higher levels of employee 

engagement correlate to healthier work environments, 

successful teams, and positive business outcomes for 

organizations.

To measure the level of engagement at the Postal 

Service, the organization administers the Postal Pulse 

survey. This 13-question instrument developed by 

Gallup, Inc., is administered annually to all employees.

Postal Pulse results identify a grand mean score, along 

with the survey response rates, which serve as our 

corporate measure of progress.

The grand mean score assesses overall engagement 

levels of surveyed respondents. The survey response 

rate identifies the level of participation of all potential 

respondents during each survey administration.

FY2019 Performance Report

In FY2019, the Postal Pulse survey response rate was 

38 percent, which was lower than our FY2019 target of 

51 percent. The following table includes both FY2019 

Actual Scores and FY2019 Targets for our corporate 

Employee Engagement metric.
28 United States Postal Service — FY2019 Annual Report to Congress

Metric

FY2019 

Actual 

Score

FY2019 

Target Delta (pp)

FY2019 

Target 

(Met/

Not Met)

Engagement Survey 

Response Rate 38% 51% (13) Not Met

Our FY2019 response rate was directly related to 

employees’ perception of local improvements made 

during the fiscal year based on feedback received 

during the previous Postal Pulse survey administration.

To increase local improvements during the next 

administration period, coaching efforts have been 

provided to employees in leadership roles who 

influence the greatest number of employees. Mid-level 

management coaching was offered in FY2019 as a key 

way to develop leader and employee relationships.

In FY2019, the grand mean score (3.36) improved 

from FY2018 (3.34). Both the grand mean score and 

the percentage of engaged employees have increased 

each year since survey inception in 2015. Based on the 

increase in grand mean performance, USPS employees 

who respond continued to see overall improvements in 

the workplace environment.

The continued training of Postal Service leaders, 

through the instructor-led “Creating an Engaging 

Workplace at USPS” training, has resulted in more than 

49,000 leaders completing the course over the past 

two years. Further outreach to bargaining unit leaders 

resulted in the creation of “Engagement Matters,” a 

training course designed for bargaining unit employees 

who have the responsibility for leading other bargaining 

unit employees.

To continue offering employees additional avenues 

to share workplace comments, the FY2019 Postal 

Pulse survey administration included a direct response 

comment box which asked employees what one action 

they believe would improve their work environment.

Almost 50 percent of employees who responded 

to the Postal Pulse survey included comments in 

their response. These comments were aggregated 

and shared with USPS leaders to directly influence 

workplace improvements starting at the highest level of 

the organization.

FY2020 Performance Plan

Although we did not meet our Postal Pulse 

Engagement Response target of 51 percent in 

FY2019, our aggressive response target in FY2020 will 

remain the same (51 percent). We believe that more 

responses will be received if employees understand 

the importance of providing feedback. In FY2020 we 

will continue to improve our communication efforts, 

highlighting the importance of employee participation.

We will provide Postal Service employees with the 

training and tools necessary to best identify, assess, 

and address engagement strengths and areas of 

opportunity specific to their local work environments.

In addition, we will continue to showcase success 

stories by recognizing our Engagement Leaders of 

the Year (awarded to non-bargaining unit leaders), 

Engagement Most Valuable Players (awarded to 

bargaining unit employees), and newly created 

Engagement Cross-Functional Teams (awarded to 

teams that have employed engagement in completing 

team projects). We will build stronger environments by 

providing active one-on-one engagement coaching, 

publishing a weekly newsletter with tips and articles 

on workplace best practices, and striving to increase 

engagement awareness across the Postal Service.

Further, new efforts in FY2020 will utilize pilot 

programs to provide greater opportunities for open 

communication and feedback. We will partner with 

Operations to increase the number of engaged 

employees and thus positively affect our customers’ 

experiences. We will re-institute the Engagement 

Champion Network, which will provide additional insight 

from 1,000 engagement partners, who will engage 

internally with local teams and all USPS employees.

Reference the FY2016–FY2019 Results and FY2019–

FY2020 Targets for Corporate-Wide Performance 

Outcomes table on page 20 for historical 

performance and FY2020 targets.

Financial Health

Several factors affected the Postal Service’s FY2019 

financial results, including: overall customer demand; 

the changing mix of postal services and contributions 

associated with those services; fluctuating volumes of 

mail and packages processed through our network; our 

ability to manage our cost structure in line with declining 

volume; growth in legacy retirement and retiree health 

benefit costs; and an increase in the number of delivery 

points.

First-Class Mail and Marketing Mail continued to 

provide the majority of our operating revenue in 

FY2019. As a percentage of operating revenue, First-
FY2019 Annual Report to Congress — United States Postal Service 29

Class Mail and Marketing Mail combined represented 

57.3 percent, 58.7 percent, and 60.8 percent for 

the years ended Sept. 30, 2019, 2018, and 2017, 

respectively. Combined First-Class Mail and Marketing 

Mail volume represented 91.6 percent, 91.5 percent, 

and 91.7 percent in FY2019, FY2018, and FY2017, 

respectively.

While we continue to experience strong results in our 

Shipping and Packages business, it represented 32 

percent of our operating revenue for the year ended 

Sept. 30, 2019, compared to First-Class Mail, which 

represented 34.3 percent. Further, our Shipping and 

Package business generated 4.3 percent of our volume 

for the year ended Sept. 30, 2019.

Although revenue and volume are closely linked to the 

strength of the U.S. economy and customer utilization 

of the mail, we have proactively targeted opportunities 

to grow our business. We continue to focus on our 

customers’ needs and have increased our investment 

in mail and package innovation. However, we also 

recognize that revenue growth is constrained by laws 

and regulations restricting the types of products, 

services, and pricing we may offer to our customers, 

and the speed with which we can bring new products 

to market.

We anticipate that the volume of First-Class Mail 

will continue to decline in future years with the 

ongoing migration to electronic communication and 

transactional alternatives resulting from technological 

changes. To address the long-term trend that such 

changes have had on our First-Class Mail revenue 

and volume, we have focused on providing new 

services and innovations with Marketing Mail. We have 

expanded service offerings, such as Informed Delivery, 

which enables customers to preview mail and packages 

scheduled to arrive as a means of merging digital and 

physical mail.

With our Shipping and Packages business, we have 

focused on growing e-commerce and implementing 

marketing campaigns to increase business. By offering 

day-specific delivery, improved tracking, text alerts, 

and up to $50 of free insurance on most Priority Mail 

packages, we have demonstrated our responsiveness 

to our customers.

In FY2019 and years prior, we implemented price 

increases on various Market-Dominant and Competitive 

services to remain competitive within the industry.

However, these price increases have not fully offset our 

losses due to overall mail volume decline.

Controllable Income (Loss)

As noted in prior years, our financial results remain 

significantly affected by expenses that are not reflective 

of our operational decisions and are subject to large 

fluctuations outside our control. We use controllable 

income (loss), rather than net income (loss), to assess 

our financial performance as net income includes the 

effect of factors (such as interest rate changes) that 

cannot be controlled or influenced by management.

Non-Controllable Expenses

Non-controllable expenses include: revaluations of the 

Postal Service Retiree Health Benefits Fund (PSRHBF) 

normal cost by the Office of Personnel Management 

(OPM); the amortization of our unfunded PSRHBF 

liabilities; the amortization of our unfunded liabilities for 

our participation in the Federal Employees Retirement 

System (FERS) and Civil Service Retirement System 

(CSRS); the 2016 change in accounting estimate of 

deferred revenue — prepaid postage liability for Forever 

stamps; and non-cash expenses related to changes 

in our liability for participation in the federal workers’ 

compensation program. We exclude these items from 

the calculation of controllable income (loss).

Fluctuations in these expenses are caused by changes 

in actuarial assumptions, such as interest and inflation 

rates, and employee and retiree demographics. We 

can only marginally influence these expenses over the 

long term by changing the number of employees or 

compensation rates, but this effect is very small and 

gradual compared to the effect of external factors.

For example, a 1 percent increase in the discount 

rate would cause a decrease in the Sept. 30, 2019, 

workers’ compensation liability and related expense 

by approximately $2.0 billion. Similarly, a 1 percent 

decrease in the discount rate would cause an increase 

in the Sept. 30, 2019, workers’ compensation liability 

and related expense by approximately $2.5 billion.

The following table includes revenue, controllable 

income (loss), and net income (loss) and shows planned 

revenues and expenses by category for FY2019 and 

FY2020, as well as actual data for FY2016-FY2018.
30 United States Postal Service — FY2019 Annual Report to Congress

Revenue and Expenses

(in billions, unaudited 1)

FY2020 

Plan (IFP)2

FY2019 

Actual

Actual 

vs Plan

FY2019 

Plan (IFP)

FY2018 

Actual

FY2017 

Actual

FY2016 

Actual

First-Class Mail 24.4 24.4 0.2 24.2 25.0 25.7 26.6

Marketing Mail 16.0 16.4 (0.4) 16.8 16.5 16.6 17.6

Shipping and Packages 23.6 22.8 (0.3) 23.1 21.5 19.5 17.3

International 2.4 2.5 (0.4) 2.9 2.6 2.6 2.7

Periodicals 1.2 1.2 0.0 1.2 1.3 1.4 1.5

Other3 4.2 4.0 0.1 3.9 3.9 3.9 3.7

Revenue 71.8 71.3 (0.8) 72.1 70.8 69.7 69.4

Temporary Exigent Surcharge 0.0 0.0 0.0 0.0 0.0 0.0 1.1

Total Revenue 71.8 71.3 (0.8) 72.1 70.8 69.7 70.5

Salaries and Benefits4 49.3 48.9 (0.1) 49.0 47.9 47.0 49.8

FERS Normal Cost 3.8 3.5 0.0 3.5 3.5 3.5 3.4

PSRHBF Normal Cost5 4.0 4.0 0.0 4.0 3.7 2.8 0.0

Transportation 8.5 8.2 (0.1) 8.3 7.9 7.2 7.0

Depreciation 1.7 1.7 0.0 1.7 1.7 1.7 1.7

Supplies and Services 2.8 2.8 (0.2) 3.0 3.0 3.0 2.8

Rent, Utilities, and Other6 5.7 5.6 (0.1) 5.7 5.3 5.3 5.2

Controllable Expenses 75.8 74.7 (0.5) 75.2 72.8 70.5 69.9

Controllable Income (Loss) (4.0) (3.4) (0.3) (3.1) (2.0) (0.8) 0.6

PSRHBF Pre-Funding 0.0 0.0 0.0 0.0 0.0 0.0 (5.8)

PSRHBF Normal Cost Actuarial Revaluation and Amortization5 0.0 0.2 0.2 0.0 (0.1) (0.5) 0.0

PSRHBF Unfunded Liability Amortization (0.9) (0.8) 0.3 (1.1) (0.8) (1.0) 0.0

FERS Unfunded Liability Amortization (1.1) (1.1) (0.1) (1.0) (1.0) (0.9) (0.2)

CSRS Unfunded Liability Amortization (1.6) (1.6) (0.2) (1.4) (1.4) (1.7) 0.0

Workers’ Comp. Fair Value and Other Non-Cash Adjustments 0.0 (2.1) (2.1) 0.0 1.4 2.2 (1.3)

Deferred Revenue - Prepaid Postage Change in Estimate7 0.0 0.0 0.0 0.0 0.0 0.0 1.1

Non-Controllable Items (3.6) (5.4) (1.9) (3.5) (1.9) (1.9) (6.2)

Net Income (Loss) (7.6) (8.8) (2.2) (6.6) (3.9) (2.7) (5.6)

1 Due to rounding, numbers presented throughout this table may not add up precisely to totals provided elsewhere in this report and percentages may not precisely reflect the 

absolute figures.

2 The FY2020 IFP information contained in this document will be revised if needed upon approval by the BOG.

3 Includes investment and interest income, gain, or loss on sale and income from the outlease of property.

4 Previously labeled “Compensation and Benefits” in FY2018 Annual Report to Congress and included FERS Normal Cost. Excludes PSRHBF pre-funding, normal cost, amortization, and actuarial revaluation; non-cash adjustments to workers’ compensation liabilities; and FERS and CSRS unfunded liabilities amortization, which are excluded from 

controllable expenses. Includes PSRHBF premiums (FY2016) and workers’ compensation cash expenses.

5 Total PSRHBF expense in FY2019 was $3.8 billion which includes a $0.2 billion non-controllable benefit. PSRHBF normal cost in FY2018 was $3.7 billion, which includes a 

$0.1 billion non-controllable expense.

6 Includes interest expense.

7 During FY2016, we revised the methodology used to estimate our deferred revenue - prepaid postage liability for Forever stamps. As a result, deferred revenue - prepaid postage was decreased by nearly $1.1 billion. In accordance with accounting principles generally accepted in the United States (GAAP), the change was accounted for as a change 

in accounting estimate.
FY2019 Annual Report to Congress — United States Postal Service 31

FY2019 Performance Report

In FY2019, the Controllable Income (Loss) was $(3.42) 

billion, which was greater than our FY2019 target of 

$(3.10) billion. The following table includes both FY2019 

Actual Score and FY2019 Target for our Controllable 

Income (Loss) metric.

Metric

FY2019 

Actual 

Score

FY2019 

Target Delta

FY2019 

Target 

(Met/

Not Met)

Controllable Income 

(Loss) ($ in billions) $(3.42) $(3.10) $(0.32) Not Met

The major factors that affected our controllable loss 

include overall customer demand, the mix of postal 

services and contribution associated with those 

services, volume of mail and packages processed 

through our network, and our ability to manage our 

cost structure in line with declining volume levels, an 

increasing number of delivery points, and legacy costs 

for retirement and retiree health benefits. We operate as 

a single segment and report our performance as such.

In FY2019, our total revenue, including interest 

and investment income was $71.3 billion and total 

expenses, including interest expense, were $80.1 

billion, resulting in a net loss of $8.8 billion. This was 

$2.2 billion more than the $6.6 billion net loss planned 

in the FY2019 IFP. The higher-than-anticipated net loss 

was primarily due to $2.1 billion of unfavorable noncash adjustments to our workers’ compensation liability, 

primarily arising from lower interest (discount) rates and 

lower-than-expected revenue, partially offset by nonpersonnel expense savings.

Revenue. Revenue includes: funds received from 

the sale of postage, mailing and shipping services; 

passports; PO Box rentals; gain or loss on sale and 

income from the outlease of property; and interest and 

investment income. Our FY2019 total revenue of $71.3 

billion was $0.8 billion less than planned, largely due to 

lower-than-expected Marketing Mail, International Mail 

and package volumes.

First-Class Mail primarily consists of single-piece and 

presort letters and postcards. Revenue from FirstClass Mail was $24.4 billion, $0.2 billion above plan, 

mainly due to higher-than-expected presort letters and 

postcards volume.

Marketing Mail consists of mail that we do not require 

customers to mail as First-Class or Periodicals and 

may include advertising, newsletters, catalogs, small 

marketing parcels, and other printed matter. Revenue 

from Marketing Mail was $16.4 billion, $0.4 billion 

below the planned amount, primarily due to lower-thanexpected volume.

Shipping and Packages consist largely of Competitive 

services that can be priced to reflect current market 

conditions. These include Priority Mail and Priority Mail 

Express, business-oriented services such as Parcel 

Select and Parcel Return, First-Class Mail parcels, and 

certain other package delivery services detailed in the 

Overview of Postal Operations section. Revenue from 

Shipping and Packages was $22.8 billion, $0.3 billion 

below our planned amount, primarily due to lower-thanexpected Parcel Select and Parcel Return volumes.

International Mail includes services that enable 

customers, both domestic and abroad, to send 

international mail and packages, with either standard 

or express delivery options. The majority of our 

International Mail revenue is generated from outbound 

services that allow customers in the U.S. to send 

mail and packages to other countries. Revenue from 

International Mail was $2.5 billion, $0.4 billion below our 

plan.

Periodicals mail is comprised primarily of newspapers, 

magazines, and other periodical publications whose 

primary purpose is transmitting information to an 

established list of subscribers or requesters. Revenue 

from Periodicals was $1.2 billion, in line with our plan.

Continued decline in hard-copy reading and advertising 

shifts away from print have depressed this segment for 

several years.

Other revenue includes ancillary services, such as 

Certified Mail, PO Box services, Return Receipt 

services, and money order and passport services.

Other revenue was $4.0 billion, $0.1 billion higher than 

our FY2019 plan.

Controllable Expenses. Our ability to affect the 

amount of controllable expenses is limited by various 

legal requirements, including our universal service 

obligation, our collective bargaining agreements, 

and our obligation to participate in federal benefits 

programs. This section describes the various categories 

of controllable expenses and their performance in 

FY2019.
32 United States Postal Service — FY2019 Annual Report to Congress

Salaries and benefits expenses include salaries, 

employee health benefit expenses for our active 

employees, and workers’ compensation cash outlays.

These expenses were $48.9 billion, $0.1 billion less 

than our FY2019 plan.

FERS normal cost expense is the expense we incur to 

fund retirement benefits for our active employees. Our 

normal cost of $3.5 billion was in line with our planned 

amount.

PSRHBF normal cost expense is the expense we 

incur to fund retirement health benefits for our active 

employees. Our normal cost of $3.8 billion was $0.2 

billion below our planned amount; however, this 

difference is considered a non-controllable benefit, as 

it is the result of differences between amounts forecast 

by OPM and its financial calculation, due to actuarial 

and experience differences. The controllable portion of 

PSRHBF normal costs, $4.0 billion, was in line with the 

plan.

Transportation expenses include the contractual costs 

we incur to transport mail and other products between 

our facilities, including highway, air and international 

transportation contracts, plus contract delivery 

services. Transportation expenses do not include the 

compensation and benefits of employees responsible 

for transporting mail and other products between our 

facilities or to delivery points. The non-personnel costs 

of transportation to delivery points, excluding contract 

delivery services, are included in rent, utilities, and other 

expenses. Total transportation expenses were $8.2 

billion, $0.1 billion less than our FY2019 plan.

Depreciation expense allocates the cost of long-lived 

assets to the periods in which they are used. These 

assets include items such as buildings, equipment, 

vehicles, leasehold improvements, and capitalized 

software. Depreciation expense was $1.7 billion, in line 

with our IFP estimate.

Supplies and services expenses include minor 

equipment, spare parts, furniture, services, cost of 

sales, and office supplies. Supplies and services 

expenses in FY2019 were $2.8 billion, $0.2 billion 

below our plan, largely due to expense control 

measures.

Rent, utilities, and other expenses include the cost 

of leasing buildings, utilities, building repairs and 

alterations, vehicle fuel, information technology, interest 

expense, and all other miscellaneous items. These 

items collectively cost $5.6 billion, which was $0.1 

billion below our plan, primarily due to lower-thanexpected information technology expenses.

FY2020 Performance Plan9

9 The FY2020 IFP information contained in this document will be revised if needed 

upon approval by the BOG.

In FY2020, we anticipate a $4.0 billion controllable loss, 

in which revenue growth of $0.5 billion is not enough 

to offset inflationary and contractual cost increases, 

an anticipated increase in the FERS normal cost, and 

modest inflationary growth in non-personnel expenses.

Revenue. Revenue is planned to increase by $0.5 

billion compared to FY2019. This increase is expected 

to be driven primarily by increases in Shipping and 

Packages. First-Class Mail revenue is estimated to 

remain flat. Marketing Mail revenue is estimated to 

decrease by $0.4 billion, as we expect the CPI-U 

price increase to only partially offset a decrease in 

volume. Shipping and Packages revenue is estimated 

to increase by $0.8 billion, mainly because of price 

increases. International revenue is estimated to 

decrease $0.2 billion due to lower volumes. Periodicals 

revenue is estimated to remain flat as electronic content 

continues to grow in popularity. Other revenue is 

estimated to increase by about $0.2 billion.

Controllable Expenses. Salaries and benefits 

expenses are planned to increase by $0.4 billion 

in FY2020, due to wage increases resulting from 

anticipated contractual general increases and costof-living adjustments. FERS normal cost expense is 

planned to increase by $0.3 billion over the FY2019 

controllable amount, in line with the increased employer 

compensation rate required by OPM. Transportation 

expenses are estimated to increase by $0.3 billion, 

largely due to inflationary pressures and expenditures 

to improve service to destinations outside of the 

continental United States. Depreciation expense 

is expected to remain flat. Supplies and services 

expenses are expected to remain flat. Rent, utilities, 

and other expenses are estimated to increase by $0.1 

billion due to normal inflationary pressures, particularly 

those related to vehicle fuel, heating oil, and vehicle 

repairs. We also plan to reduce the number of work 

hours through increased efficiency.
FY2019 Annual Report to Congress — United States Postal Service 33

Non-Controllable Expenses. Our FY2019 IFP 

included $4.0 billion for PSRHBF normal cost as part of 

controllable expenses, based on projections from OPM.

The actual amount billed by OPM was $3.8 billion; the 

$0.2 billion difference was reflected as an offset to noncontrollable expenses. In FY2018, OPM increased its 

normal cost calculation by $0.2 billion. As that increase 

in PSRHBF normal costs was due to changes in the 

actuarial assumptions by OPM, we also treated it as 

non-controllable. There is no plan for a normal cost 

revaluation expense in FY2020 as we cannot predict 

calculation changes by OPM.

OPM calculates the PSRHBF amortization expense to 

allow us to pay down our unfunded liability obligations 

in the PSRHBF program. The FY2019 IFP included $1.1 

billion in expenses, based on the most recent OPM 

data available at the time we published the IFP. The 

actual billed amount in FY2019 was $0.8 billion. This 

lower amortization requirement primarily resulted from 

a higher-than-expected discount rate used by OPM 

in calculating the liability. Based on the latest available 

information, the FY2020 IFP includes a $0.9 billion 

expense for PSRHBF unfunded liability amortization.

OPM calculates both FERS and CSRS amortization 

payments to allow us to pay down our unfunded liability 

obligations in the FERS and CSRS programs. We 

consider these expenses non-controllable because the 

amount depends on actuarial assumptions, including 

interest and inflation rates, over which we have no 

control. FY2019 planned expenses for FERS and 

CSRS amortization were $1.0 billion and $1.4 billion, 

respectively, based on the most recent data available 

at the time we published the IFP. The actual charged 

amounts in FY2019 were $1.1 billion and $1.6 billion, 

respectively. Our FY2020 IFP includes CSRS and FERS 

amortization expenses equal to their actual FY2019 

values.

GAAP requires us to record our Sept. 30, 2019, 

workers’ compensation liability based on the prevailing 

interest rates on that date. The adjustment to the 

liability is non-controllable, as it is a function of events 

taking place in the general economy and well outside 

our control. We do not plan for this adjustment in 

our IFP, as we cannot predict future interest rates. In 

FY2019, we recorded a $2.1 billion non-controllable 

increase in workers’ compensation expense, due 

primarily to the unfavorable impact that increasing 

interest rates has on our workers’ compensation liability.

This represents a $3.5 billion lower benefit compared to 

the prior year.

Return to Long-Term Stability. For the Postal Service 

to effectively leverage the best available technologies 

and solutions to enhance our operations and services, 

and best serve our customers by providing reliable 

postal services, we will continue to take aggressive 

management actions to control costs, increase 

efficiency and return to long-term financial stability.

However, we need both Congress and the PRC to 

make necessary statutory and regulatory business 

model changes to assist our internal efforts. We 

are relying on Congress to enact effective postal 

reform legislation, the centerpiece of which must be 

a requirement that postal retirees enroll in Medicare.

This is a near-universal practice for businesses that still 

provides retiree health benefits and would ensure that 

the Postal Service’s retiree health benefits program 

aligns with private sector best practices.

Also critical to solving our long-term financial challenges 

is the 10-year statutory review of the system for 

regulating rates and classes for Market-Dominant 

services the PRC is conducting. Changes to the current 

pricing system are necessary because the current 

regulatory structure restricts our ability to adjust prices 

of Market-Dominant services. This current model is 

predicated on a price cap that does not take changes 

in Postal Service volumes and costs into account.

As the past decade has illustrated, this system is not 

suitable for ensuring the Postal Service’s continued 

ability to provide prompt and reliable universal services, 

and to meet our other statutory obligations in a selfsufficient manner. The Postal Service seeks a structure 

that gives us the ability to set prices at levels necessary 

to ensure our financial stability.

Reference the FY2016–FY2019 Results and FY2019–

FY2020 Targets for Corporate-Wide Performance 

Outcomes table on page 20 for historical 

performance and FY2020 targets.
34 United States Postal Service — FY2019 Annual Report to Congress

Deliveries per Total Work Hours, Percent Change10

10 The FY2020 IFP information contained in this document will be revised if needed 

upon approval by the BOG.

Deliveries per total work hours (DPTWH) is a measure of 

our overall efficiency. It is calculated by multiplying the 

total possible deliveries by the number of delivery days 

and dividing that product by total work hours. We target 

our percent improvement in DPTWH from year to year.

We adjust work hours to reflect changes in workload 

compared to the prior year. This adjustment accounts 

for changes in the network size (the addition of 

delivery points), changes in the number of non-Sunday 

delivery days, and changes in the mix of mail types (for 

example, a package usually contributes much more to 

workload than a letter or flat). The adjustment ensures 

that DPTWH is comparable from year to year.

Finally, the percent change in DPTWH is calculated 

by comparing the current year DPTWH (based on 

adjusted work hours) with prior year DPTWH (based on 

unadjusted work hours).

FY2019 Performance Report

The following table includes both FY2019 Actual Scores 

and FY2019 Targets for our corporate DPTWH, Percent 

Change metric.

Metric

FY2019 

Actual 

Score

FY2019 

Target Delta

FY2019 

Target 

(Met/

Not Met)

DPTWH, Percent Change (0.60) 1.40 (2.00) Not Met

In FY2019, we recorded 1,187.3 work hours (adjusted 

for earned workload) and made 48,270 million 

deliveries. While delivery points grew in FY2019, 

package volume was unchanged and letter and 

periodical volumes decreased significantly. The 

number of deliveries made during the year grew by 

approximately 445 million, which is the net result of the 

addition of about 1.3 million new delivery points, as well 

as a small impact from increased Sunday deliveries.

There would have been an additional delivery day 

in FY2019 (303) as compared to FY2018 (302), but 

delivery days were equal due to the national day of 

mourning to honor former President George H.W. Bush 

on Dec. 5, 2018.

The FY2019 DPTWH, Percent Change target was a 

1.4 percent improvement in DPTWH; however, actual 

performance was a decrease of 0.60 percent due to 

overrunning our work hours relative to plan. Work hour 

overruns occurred mainly in the first half of the fiscal 

year due largely to increases in political and election 

mail as well as efforts to improve service during peak 

holiday season.

FY2020 Performance Plan

The FY2020 DPTWH, Percent Change target is 

1.50 percent. The target assumes we will capture work 

hour reductions from declining mail volume and from 

operational initiatives to improve efficiencies in mail 

processing, delivery, and customer service.

Reference the FY2016–FY2019 Results and FY2019–

FY2020 Targets for Corporate-Wide Performance 

Outcomes table on page 20 for historical 

performance and FY2020 targets.

Other Productivity Measures

Total Factor Productivity (TFP) measures how efficiently 

we use our resources11

11We use DPTWH rather than TFP as our primary efficiency measurement indicator 

for two reasons: 1) DPTWH is easier to understand with greater measurable depth 

to the Area and District level and; 2) DPTWH can be reported in a timelier manner 

allowing us to more quickly assess our performance compared to TFP.

. An increase in TFP indicates 

that the ratio of work completed to the resources 

used is increasing, and we are operating more 

efficiently. Work completed depends on three primary 

components: the number of delivery points, mail 

volume weighted by product type, and miscellaneous 

output (such as other services we provide, including 

passport services). Labor productivity measures the 

efficiency of labor. An increase in the labor productivity 

index indicates that more workload is being handled 

per unit of labor. For both indices, resource usage 

is based on the constant-dollar amounts of labor, 

capital, and materials used. Because some productivity 

improvements take years for the effects to be realized, 

it is more informative to consider changes in TFP and 

labor productivity over a period of years, rather than 

year-to-year.

In FY2019, labor productivity decreased by 0.3 percent 

after nine consecutive years of increasing. This marks 

only the second year since 1997 that labor productivity 

did not increase. TFP has increased significantly since 

FY2009, though in recent years TFP has decreased 

each year with the exception of FY2018. Total 

Factor Productivity for FY2019 was -0.3 percent, 

with the decrease in TFP attributed to negative 

labor productivity, declining mail volumes, increased 

transportation expenses, and increased investments.
FY2019 Annual Report to Congress — United States Postal Service 35

Labor productivity was negatively impacted by the 

National Rural mail count, the arbitration decision to 

convert Highway Contract Routes (HCR) to Postal 

Vehicle Services (PVS)12

12An arbitration decision signed Aug. 18, 2016, required USPS to insource specific routes from HCR to PVS.

, and increases in political 

and election mail. A number of factors, including the 

continuing decline in mail volume in recent years, 

has made it more challenging to generate additional 

productivity growth.

The following chart13 starts with the cumulative TFP and 

labor productivity improvement from an index year of 

1971 to 2007 and then shows the cumulative change 

each year since FY2007.

13 FY2018 TFP and Labor Productivity were recast after the final Cost and Revenue Analysis (CRA) was issued 

in January 2019. FY2019 TFP and Labor Productivity is preliminary until the CRA report is released in 

January 2020.

Total Factor Productivity and Labor Productivity, Cumulative Percent Change Since 1971

10

20

30

40

50

60

70

Labor Productivity

Total Factor Productivity

2007 2008 2009

Fiscal Year

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Cumulative Percent Change Since 1971

46.1

21.6 21.0

19.8

22.2

23.9

25.1

27.4 27.8 27.9 27.7

47.1 46.2

49.9

52.7

54.1

57.9

59.2 59.9

61.3

27.0 27.0

61.5

62.2

26.6

61.8
36 United States Postal Service — FY2019 Annual Report to Congress

Strategic Initiatives

The Postal Service has established strategic goals 

as described in our FY2020-FY2024 Five-Year 

Strategic Plan. To help achieve these goals, we have 

implemented a portfolio of strategic initiatives and a 

rigorous portfolio management process. This process is 

based on well-established methods to apply strategic 

and financial rigor to decision-making and to navigate 

significant organizational changes.

Each strategic initiative has a specific set of measures 

to track performance aligned to optimize short-term 

performance and build long-term capabilities. The 

portfolio of initiatives is dynamic and changes as 

priorities and resources change, and as programs are 

completed or adjusted based on external events.

The changes to our initiatives from FY2019 to FY2020 

fall into the following categories:

 Continued: Initiative continued into FY2020 with 

minimal changes from FY2019.

 Refined: Initiative was modified to achieve greater 

alignment with organizational goals and the current 

business environment.

The table on the following page shows how the 

strategic initiatives implemented in FY2019 and planned 

for FY2020 align to the strategies from our Five-Year 

Strategic Plan and to the corporate-wide performance 

metrics. Note: The strategic initiatives identified in the 

USPS Five-Year Strategic Plan for FY2020-FY2024 

are subject to change by the Board of Governors as 

changes in strategy become necessary or business 

conditions warrant.

One of the more than 12,400 ProMaster 2500 vehicles that 

the Postal Service uses to deliver mail and packages.
FY2019 Annual Report to Congress — United States Postal Service 37

FY2019 and FY2020 Strategic Initiatives

Section 508 Version

FY2019 Corporate Outcomes Supported FY2020 Corporate Outcomes Supported

Strategies 

from the 

FY2020–

2024 

Five-Year 

Strategic 

Plan

FY2019 

Strategic 

Initiatives

HighQuality 

Service

Excellent 

Customer 

Experiences

Safe 

Workplace 

and 

Engaged 

Workforce

Financial 

Health

Change 

from 

FY2019 

to 

FY2020

FY2020 

Strategic 

Initiatives

HighQuality 

Service

Excellent 

Customer 

Experiences

Safe 

Workplace 

and 

Engaged 

Workforce

Financial 

Health

Deliver 

World-Class 

Customer 

Experience

Build a 

World-Class 

Customer 

Experience

X X X Continued

Build a 

World-Class 

Customer 

Experience

X X X

Equip, 

Empower, 

Connect 

and Engage 

Employees

Improve 

Employee 

Experience

X X Refined

Form the 

Workforce 

of the 

Future

X X

Innovate 

Faster to 

Deliver Value

Accelerate 

Innovation 

to Maximize 

Business 

Value

X X X X Continued

Accelerate 

Innovation 

to Maximize 

Business 

Value

X X X X

Accelerate 

Innovation 

to Create 

Customer 

Value and 

Increase 

Profitability

X X X Refined

Accelerate 

Innovation 

to Enhance 

the Value of 

Mail

X X X

Build 

Platform 

to Grow 

Profitable 

Packages 

Business

X X X Refined

Accelerate 

Innovation 

to Grow a 

Profitable 

Package 

Platform

X X X

Invest in 

Our Future 

Platforms

Optimize 

Network 

Platform

X X Continued

Optimize 

Network 

Platform

X X

Delivery 

Structure 

Optimization

X X X Refined

Optimize 

Delivery 

and Retail 

Platforms

X X X
A USPS retail clerk stands near Post 

Office Boxes at the Makiki, HI, Post Office.

Additional Information

For more information on our services, products, 

programs, and policies, visit usps.com.

Trademarks

The eagle logo, the trade dress of USPS packaging, 

the letter carrier uniform, trade dress of the round top 

collection box and the postal truck and the following 

word marks are among the many trademarks owned 

by the United States Postal Service®: Certified Mail®, 

First-ClassTM, First-Class Mail®, First-Class Package®, 

Forever®, Global Express Guaranteed®, Informed 

Delivery®, Informed Visibility®, Parcel Select®, PO 

BoxTM, Post Office®, Postal Pulse®, Postal ServiceTM, 

Priority Mail®, Priority Mail Express®, Priority Mail 

Express International®, Priority Mail International®, 

Putting our Stamp on a Greener Tomorrow®, Standard 

Mail®, Standard PostTM, United States Postal 

Inspection Service®, United States Postal Service®, 

U.S. Mail®, U.S. Postal Service®, USPS®, USPS 

BlueEarth®, USPS Marketing Mail®, USPS Retail 

Ground®, USPS Tracking®, usps.com®, Village Post 

OfficeTM, and ZIP CodeTM.

Year References

All references to a specific year or “the year” refer to the 

Postal Service fiscal year ending Sept. 30. However, 

specific month and year references pertain to the 

calendar dates.

38 United States Postal Service — FY2019 Annual Report to Congress
A USPS customer uses 

a self-service kiosk to 

ship a package.