Category: Privitazation

USPS Suspends FERS Funding: What Postal Workers Need to Know Now

The United States Postal Service has announced a major financial move that directly affects how retirement is funded. On April 9, 2026, USPS confirmed it will begin a cash conservation plan by temporarily suspending its employer contributions to the Federal Employees Retirement System pension, also known as the FERS annuity.

This decision, made by the USPS Board of Governors and effective April 10, is being taken to preserve cash as the Postal Service faces what it describes as a severe financial situation. USPS currently pays about $200 million every two weeks into the FERS pension system. By suspending these payments, the Postal Service expects to free up approximately $2.5 billion this fiscal year. USPS has stated that without actions like this, it could face a cash shortfall as early as February 2027.

It is critical for members to understand exactly what is and is not changing.

Employee contributions to FERS continue as normal. Thrift Savings Plan contributions, including USPS automatic and matching contributions, also continue. Social Security contributions remain unchanged. Employees will continue to earn retirement service credit, and USPS states there is no immediate impact to current employees or retirees. Current union contracts are not affected.

What has changed is that USPS is temporarily stopping its share of pension funding. This means the Postal Service is not contributing its portion to the FERS annuity while employees continue to contribute their share.

USPS has stated this is a temporary measure intended to buy time while Congress considers financial and structural changes, including borrowing authority increases, retirement funding adjustments, and cost reforms. At the same time, USPS has confirmed it has already reduced its workforce by more than 28,000 employees and cut 56 million work hours as part of ongoing cost-cutting efforts.

What This Means for Postal Workers

Right now, your paycheck, your contributions, and your retirement calculations are not changing. Your benefits remain in place today. However, USPS is no longer funding its portion of the pension system during this period, which reflects the level of financial pressure the organization is under.

How This Can Affect You Over Time

In the short term, there is no immediate impact. If funding resumes, effects remain minimal.

In the mid-term, the outcome depends on what happens next. If USPS restores and makes up missed contributions, the impact remains limited. If financial pressures continue, it increases focus on costs, including retirement funding.

In the long term, continued financial strain can lead to greater attention on workforce costs, retirement obligations, and overall structure. Decisions made now will shape the future of the Postal Service and its workforce.

Why This Matters

This is not just a financial adjustment. It is part of a broader situation where USPS is making real operational and financial decisions to manage costs, reduce workforce levels, and restructure how it operates. These decisions directly connect to the larger conversation about the future of the Postal Service, including proposals that have already outlined post office closures, price increases, and operational changes.

WE have seen these types of challenges before. WE have faced threats to our jobs, our work, and our public service, and WE have stood together to protect it.

That same unity is needed now.

WE must stay informed.
WE must stay engaged in our Local.
WE must attend union meetings, rallies, and all union functions to stay informed and build strength together.
WE must speak to our co-workers, our families, and our communities about what is at stake.
WE must make our voices heard with those making these decisions.

We must also reach out to our communities and local businesses. Changes to the Postal Service affect them directly through higher costs, reduced service, and impacts on local economies.

This is about protecting our jobs, our benefits, and the public service that belongs to the American people.

WE are the Postal Service. Together, WE will stand up, show up, and protect it.

What the PMG’s Statement Means for US – And Why WE Must Act

The Postmaster General’s recent statement lays out a clear picture of where the Postal Service stands and where it could be headed. According to the statement, USPS is facing serious financial challenges, with declining mail volume and rising obligations. It warns that without changes, the Postal Service could run out of cash within 12 months.

To address this, three paths were presented: do nothing and risk running out of money, make major cuts to service and operations, or implement financial and structural changes to reduce costs and improve revenue. Each of these paths carries real consequences for postal workers and the communities we serve.

For workers, the statement confirms that changes are already happening. Over the past four years, USPS has reduced its workforce by tens of thousands of employees and cut millions of work hours. The statement also makes clear that additional measures such as reducing delivery days, closing post offices, and cutting operations are being considered as options. These types of actions directly impact staffing levels, job opportunities, and workload across the Postal Service.

The statement also identifies retirement obligations, health benefits, and other long-term commitments as major financial pressures. These are described as part of the cost challenges facing USPS. This means that the very benefits we have earned through years of service are being viewed as expenses that need to be addressed as part of the financial plan.

At the same time, the statement emphasizes the need for USPS to operate in a more financially driven way, focusing on matching costs to revenue, improving efficiency, and generating sustained income. This approach shifts the focus toward running the Postal Service more like a business, where financial performance becomes a central priority.

The statement also presents options that include reducing delivery frequency, closing facilities, and raising prices. These are described as serious actions that would have a direct impact on service to the public. These types of changes would affect every community that depends on the Postal Service, especially rural areas, small businesses, and those who rely on consistent and affordable mail delivery.

What this means is simple. The future of the Postal Service is being shaped right now through decisions about cost, service, and structure. Those decisions directly affect our jobs, our benefits, our retirement, and the service we provide to the American people.

WE have been here before. WE have faced major challenges and changes to the Postal Service, and WE have stood together to protect it. That same unity is needed now.

WE must stay informed.
WE must stay engaged in our Local.
WE must attend our union meetings, rallies, and all union functions to stay informed and build strength together.
WE must speak to our co-workers, our families, and our communities about what is at stake.
WE must make our voices heard with those making these decisions.

This is about protecting our jobs, our benefits, and the public service that belongs to the American people.

WE are the Postal Service. And together, WE will stand up, show up, and protect it.

TO READ THE PMG’s STATEMENT, CLICK HERE –> Statement of PMG & CEO_3.17.2026 TO DOWNLOAD IT

USPS Privatization Warning Signs in 2026

Is USPS Being Shifted Toward a Private Model? What Members Must Watch

Recent developments across multiple areas of Postal Service operations reveal significant shifts in how USPS is being structured and positioned. When examined together, these actions reflect a growing emphasis on parcel revenue, pricing adjustments, digital substitution, and expanded partnerships with private carriers.

The Postal Service recently returned more than 800 holiday care packages intended for deployed U.S. troops due to stricter enforcement of international customs labeling requirements. After political intervention, many of those packages were resent at no additional charge, although some remain unaccounted for. This incident highlights operational pressures and compliance enforcement within international shipping processes.

At the same time, USPS projects that package growth will drive a 9.4 percent year over year revenue increase in fiscal year 2026. Leadership has identified parcel delivery as a primary revenue driver as traditional mail volumes continue to decline. That forecast is paired with announced parcel price increases scheduled for early 2026, including an average increase of nearly 8 percent for Ground Advantage and additional increases across Parcel Select, Priority Mail, and Priority Mail Express.

Despite rate increases, year end reporting shows a 5.7 percent decline in shipping and package volumes compared with the prior period. Revenue remains constrained even as pricing flexibility expands.

Legislative developments are also affecting mail volume. A House investment reform bill includes a provision allowing financial disclosure documents to default to electronic delivery. While described as modernization, this change reduces required physical mail sent through USPS, contributing to ongoing erosion of traditional mail volume.

Operational adjustments are continuing as well. USPS has reversed course on certain last mile delivery approaches and has pursued agreements with private carriers such as UPS for delivery of certain parcels. USPS is also expanding network access for shippers as part of revenue diversification efforts.

Meanwhile, USPS leadership is seeking administrative and legislative reforms following multibillion dollar losses. Proposed areas of focus include pension funding adjustments and workers compensation process changes aimed at improving long term financial stability.

Small businesses are also adapting to tariff changes and evolving international trade rules, which directly impact international shipping demand and cost structures.

Viewed collectively, these developments show a consistent pattern. Increased reliance on parcel revenue, expanded pricing authority, private carrier partnerships, electronic substitution of mail, and legislative changes reducing traditional mail volume all indicate a continued structural shift. The Postal Service is operating more like a competitive logistics company while core public service functions narrow. These actions, taken together, reflect movement away from a traditional universal service model and toward a model driven more heavily by market pressures.

For APWU members, this is not theoretical. Decisions affecting pricing, service standards, mail volume, and operational structure directly impact jobs, staffing, and long term stability. Engagement is essential.

Members should stay informed, attend General Membership Meetings, participate in rallies, and support contract enforcement efforts. Legislative developments and operational restructuring are ongoing. An active, informed membership remains the strongest safeguard for protecting public postal service and ensuring workers have a voice in the direction of the Postal Service.