Print Can Help Boost the Economy

No business sector is more representative of small business than printers. There are approximately 36,000 commercial printers (not including neighborhood print shops) in the United States. However, this number is falling dramatically as more and more printers fail due to the recession, an increase in bulk mail rates by the U.S. Postal Service, and the government’s on-going unwritten policy of manufacturing print in-house rather than reliance on the private sector.

Not too long ago, 51 percent of everything printed ended up going through the mail. When the bulk mail rate went up, direct mail volumes went down in favor of online advertising and other less expensive forms of marketing. This changed the print business dynamics. Not only did the U.S. Postal Service get itself into deeper financial trouble by reducing this major source of contribution to its overhead, but it hurt the print industry. Now, instead of printers utilizing 70 percent of their capacity on a day-by-day basis, the figure dropped like a rock. In some cases the capacity utilization is now 20 percent and less.

According to the Printing Industries of America (PIA), the print industry consists of nearly a million small business people. In fact the average commercial printer had 27 employees and revenues of about $4.5 million. This is no longer true, as many of these printers have been hit hard and are seeking work wherever they can find it. Approximately 10,000 of these print companies are registered to do work for the U.S. Government Printing Office (GPO), and of those 400 have historically been active, depending on workflow from the GPO to remain viable businesses. The GPO sends work valued at about $400 million a year to the private sector. However, that number just a few years back was more than $500 million.

Last year, total GPO work to the private sector was $440 million. There has been roughly a 27 percent drop in GPO derived income by private sector printers over the past dozen years. Factor in inflation and the drop is even more dramatic. The reason for the drop is not better management, more efficiency, or even less print. Au contraire, the reason for the drop is the uncontrolled growth of the in-house print plant operated by the GPO, the granting of waivers by the government for the operating of thousands of other in-house print plants, and the active efforts by many government agencies to get around the rules. This does not bode well for the print industry.

This significant drop is a growing concern because, by all accounts, government agencies are requesting more print now than ever. Federal government forms alone, according to a recent New York Times news story, have increased to more than 8,000 different types—enough to require 10 billion hours of time to fill out compared to just one billion hours in 1981.

So, why less work to the private sector when government print demands are increasing? It seems Congressional directives are not being followed. According to Title 44 of the U.S. Code enacted by Congress in 1813, all print procurement by Executive, Legislative and Judiciary agencies must be ordered through the GPO, as opposed to through individual agencies. Now, though, a system is being created by GPO and agency administrators as they use waivers to channel GPO work directly to agency print shops, third-party creative agencies and contractors, including those for the U.S. Department of Defense and other departments. Accountability is limited. No one knows how many agency print shops exist, and they certainly do not know how much work is produced by them. We do know GPO work to the private sector is dropping. We also know that if the government were a private sector entity, the total amount of its print would be between $30 billion and $90 billion, not the $1 billion or so GPO either prints in-house itself or procures from the private sector.