Starting Monday, Canadians will face an increase in the cost of mailing letters, with significant adjustments to postage stamp prices. Stamps purchased in booklets, coils, or panes will rise by 25 cents, bringing the price to $1.24 per stamp. Individual stamps will see a more pronounced increase, going from $1.15 to $1.44.
This one-time price hike, estimated at approximately 25 percent across the board, is aimed at offsetting the rising expenses associated with providing letter mail service to Canadian households and businesses. Canada Post has projected that the average household will incur an additional cost of $2.26 annually due to these price changes, while Canadian small businesses will experience an increase of about $42.17 per year.
The newly adjusted rates are expected to generate around $80 million in extra revenue for Canada Post in 2025. The Crown corporation has indicated that the organization is dealing with significant financial pressures, attributed to declining letter mail volumes even as the number of addresses needing service continues to rise. According to internal Canada Post data, the volume of letter mail has plummeted by 60 percent over the last two decades, decreasing from 5.5 billion letters in 2006 to just 2.2 billion letters in 2023.
In spite of this reduction in mail volume, the number of addresses served by Canada Post has increased by over three million. As of 2023, the corporation reported servicing approximately 17.4 million addresses across Canada. This juxtaposition of declining mail volume alongside an expanding delivery network has severely strained Canada Post's finances, culminating in a total pre-tax loss of $3 billion over the last six years. In 2023 alone, the organization faced a loss of $748 million.
The price increase was initially announced last September and follows a significant postal workers' strike that lasted from mid-November to mid-December, during which 55,000 union members halted work. This strike was concluded when the members were ordered back to work after the two sides reached an impasse during contract negotiations.
As part of the ongoing labor dispute, a hearing before the Canada Industrial Relations Board is set to begin on Monday. This two-day hearing will address the constitutionality of the government's back-to-work order, which the Canadian Union of Postal Workers contends is an illegal infringement of their charter rights.
In light of all these developments, the operational challenges faced by Canada Post reflect a broader trend where evolving consumer habits and economic pressures necessitate adjustments in postal pricing. As postal services navigate this complex landscape, the recent stamp price increases serve as a critical measure aimed at sustaining viable service delivery in the face of dwindling letter mail volumes and rising service demands.
