The United States Postal Service announced Thursday, April 9, that all employer contributions to the Federal Employees Retirement System (FERS) will be suspended.
This suspension will be effective from April 10, as the agency faces a severe financial crisis that may leave it cashless within 12 months.
Through cash conservation measures, around $2.5 billion will be saved. However, this will stop the $200 million in payments that USPS makes every two weeks to contribute to the federal pension program.
According to Luke Grossman, USPS chief financial officer, “the risk to the Postal Service and the American public from insufficient liquidity for postal operations far outweighs any long-term risk to pension funds.”
Concerns about the cash crisis were raised last month by Postmaster General David Steiner, who warned that without major reforms, the agency would face a cash shortage by February 2027.
This potentially halted mail delivery across the country. According to Steiner, this could be solved by increasing the price of first-class stamps to 95 cents or $1 from the current 78 cents.
Another suggestion was to reduce deliveries from six days a week to five or less.
Since 2007, the USPS has reported net losses of $118 billion as first-class mail volume has fallen to its lowest level since the late 1960s.
In 2025 alone, the agency posted a loss of $9 billion.
Despite the suspension announcement, USPS emphasized that the suspension of pensions will not immediately affect current or future retirees.
