The USPS is working toward increasing its holiday season package delivery capabilities by 35% over 2020’s capabilities. This year’s capacity should exceed 50 million packages a day.
Central to the increased capacity are the addition of 112 new package sorting machines, and forty-five leased annex facilities. The annexes are planned near existing processing plants. An additional 40,000 seasonal workers will be hired to handle the increased volume.
Concurrent with the addition of 45 new facilities, the USPS is consolidating 18 mail processing plants. These consolidations are scheduled to be completed by November 2021. The Postal Service is intent on not laying off any employees due to the consolidations.
Consolidation of mail processing facilities were instituted in 2015 under a two-phase plan. Under phase one 141 processing plants were closed. Phase two was abandoned after Congress objected due to concerns the USPS would fail to meet mail delivery standards as well as the loss of thousands of postal worker jobs. With one exception, the processing facilities targeted in phase two were USPS owned properties. These consolidations predicted to affect about 40% of First-Class Mail.
An increase in capital expenditures allows the USPS to make these changes. The difficult financial position of the USPS over the last decade has put the USPS behind its package delivery competition due to decreased in capital expenditures. According to the USPS OIG, while the UPS also decreased its annual capital investments, though at a slower pace, FedEx has continually increased its capital spending 2.3 percent annually on average.” These changes are designed to bring the USPS into a better competitive position.