The last holiday season was far from the most wonderful time of the year for the U.S. Postal Service: Sick and quarantined workers, a flood of packages from shoppers loathe to set foot in stores and a last-minute dump of packages from overwhelmed private shippers.

Postal workers who recall packages and letters piled up in distribution hubs are better prepared this time as they gear up for another pandemic crunch. But low product inventories and port and supply chain disruptions are creating new uncertainty about getting gifts delivered.

Already, workers are seeing a surge in holiday packages that began several weeks ago.

“A lot of the workers are saying, ‘Oh no. Here we go again,’” said Scott Adams, local president of the American Postal Workers Union in Portland.

The U.S. Postal Service and private shippers UPS and FedEx are bolstering their hiring — bringing in about 230,000 temporary workers — and taking other steps to ensure they don’t become overwhelmed by packages.

Nearly 3.4 billion parcels are expected to crisscross the country this holiday season, representing an estimated increase of about 400 million compared to last year, said Satish Jindel, from Pennsylvania-based ShipMatrix, which analyzes shipping package data.

When cards and letters are included, the U.S. Postal Service said it'll be delivering more than 12 billion items.

“The pandemic is still here. The supply chain is a challenge that’s going to impact how people shop and how products move,” said Mark Dimondstein, president of the American Postal Workers Union, which represents more than 200,000 postal workers.

Despite the precarious situation, the Postal Service, UPS and FedEx are in better shape to handle the peak volume, and several trends could work in their favor, Jindel said.

More people are shopping in stores compared to last year, and people have been placing online orders earlier because they’re keenly aware of supply chain problems, Jindel said. Also, with workers returning to offices, there are fewer office supply shipments being made to homes, he said.

Most importantly, the shippers are adapting after their rough-and-tumble experience last year, he said.

U.S. Postmaster General Louis DeJoy, who faced withering criticism last year but reported on-time improvements and reduced operating losses this month, says the service is ready for the crunch.

“We are ready, so send us your packages and your mail,” he said.

A year ago, more than a third of Postal Service first-class mail was late by the time Christmas arrived.

Tractor-trailers stuffed with mail were left idling outside some postal-sorting facilities. Packages and letters piled up in distribution hubs. Delays grew by days, and then weeks, in many instances.

Two things were painfully obvious. More workers and more space were needed — and both are being addressed.

To get a handle of the volume, the Postal Service is transitioning more than 30,000 non-career employees to the ranks of career employees by peak season, hiring 40,000 seasonal employees, and leasing extra space at more than 100 locations to ensure there’s room for parcels.

The Postal Service installed more than 100 new package sorting machines as of early November, part of $40 billion of planned investment over 10 years. Also, more than 50 package systems capable of sorting large packages are expected to be deployed before December. Combined, these expand capacity by an additional 4.5 million packages per day, officials said.

UPS, for its part, is hiring more than 100,000 seasonal employees across the country and continues to add aircraft and automation. It expects nearly 90% of its packages to flow through automated facilities by year’s end.

FedEx, meanwhile, is in the process of boosting its nationwide workforce by 90,000 across its operating companies. Most of those new workers are expected to remain after the holidays, the company said.

Despite all those extra workers, the shippers agree that this is not the year for shoppers to procrastinate.

“Complete your holiday shopping as soon as possible,” said Jim Mayer, spokesperson for UPS.

CENTENNIAL, Colo. — Things are already getting festive in the Streets at SouthGlenn mall in Colorado.

They are kicking off the holiday season with a Christmas parade. And everyone is waiting for the guest of honor. Santa.

“It’s exciting, it’s thrilling, it’s magical. The children are the core of the magic of Christmas,” said Susen Mesco, with American Events and Promotions.

Susen Mesco is donning her Mrs. Claus outfit as she helps Santa at the holiday parade.

She also runs a Santa school and knows that it might be harder to book Santa for your holiday party this year.

“Usually, we do about 60 Santas live. They start in February with their classes,” said Mesco, “In the past couple years, because of travel situations and people not wanting to be in a conference situation, what we’ve found is about the half enrollment of the Claus Clan,”

The labor shortage that’s been impacting the whole country seems to have made its way to the North Pole as well.

“Seasonal labor is traditionally in the same target market where there’s been difficulty hiring,” said Jack Buffington.

He runs the supply chain program at the University of Denver and says it’s not shocking the labor issue is impacting Saint Nick.

“You think about it, it’s like a four-hour seasonal shift, making $20, $30 an hour. I mean, gosh, especially given the fact that most of the people who fit in this category are not supposed to be in public, big crowds, or around unvaccinated people,” said Buffington.

Mesco said a shortage of Santa’s is only part of the problem.

“This year, more people want to have a party,” she said

Demand is up, so if you’re trying to have a party on the weekend in December, you might have an issue finding a Santa. But of course, Mrs. Claus has a solution.

“You can have just as much fun on a Tuesday night. Smores and cookies taste just as good on a Tuesday night as they do on a Saturday. So if people are flexible, Santa’s are going to be able to make it to every one of those parties,” said Mesco.

Just like everything else we’ve been through the last year and a half, a little flexibility goes a long way.

And maybe it shouldn’t be so shocking that there’s a shortage of Santas this year.

“I don’t know why everyone is so surprised. There’s only one Santa Claus,” said one of Santa's elves.

And there’s one night. He should definitely be available.

“Boys and girls, don’t forget that if you’ve been good, no matter what happens, Santa will be there on Christmas Eve,” said Mesco.

Weary retailers continue to battle pandemic uncertainty as the delta variant causes new spikes in coronavirus infections. But for now, at least, expectations for a merry holiday season remain intact.

What's happening: Data published Thursday is expected to confirm that U.S. retail sales declined for the second straight month in August.

But new forecasts from Deloitte, Bain & Company and Mastercard predict a huge sales boom in the coming months, the most important time of the year for retailers.

Deloitte estimates that holiday sales will increase between 7% and 9% in 2021 as vaccinations help shoppers feel more comfortable venturing out to spend some of the cash they've been hoarding.

"A steady decline in the savings rate to pre-pandemic levels will support consumer spending and keep retail sales elevated this season," said Daniel Bachman, Deloitte's U.S. economic forecaster. "Further, e-commerce sales will continue to grow as consumers demonstrate an ongoing and steady movement toward buying online across all categories."

The consulting firm expects online sales to jump between 11% and 15% year-over-year, reaching up to $218 billion.

Mastercard, for its part, sees U.S. retail sales rising 7.4%. While online shopping could rally 7.6%, in-store shopping is expected to increase by 6.6% compared to 2020. Bain & Company is also calling for a 7% sales growth rate in November and December.

"The pandemic has impacted nearly every inch of the retail industry," said Aaron Cheris, the head of Bain & Company's Americas Retail practice. "However, heading into this holiday season, we also see important tailwinds for nominal retail growth, including boosts from inflation, rebounding employment, healthy savings rates and wage growth."

But wait: Supply chains remain badly tangled, causing shipping costs to soar. Some companies worry that empty shelves and shortages of in-demand products could dampen the mood.

"The demand is going to be there," MGA Entertainment CEO Isaac Larian told CNN Business late last month. "What is not going to be there is the product to fill the demand."

Mastercard thinks retailers will try to get around supply chain concerns, as well as persistent difficulties in hiring workers, by offering earlier holiday promotions in stores and online — particularly for electronics and clothing items.

"This holiday season will be defined by early shopping," Steve Sadove, senior advisor for Mastercard, said in a statement.

Investor insight: A spending surge would be good news for retail stocks, which shot up earlier this year but have been caught in a holding pattern in recent months. The SPDR S&P Retail ETF is up 45% year-to-date, but has shed 4.4% in the third quarter.

U.S. retail sales for August will provide a crucial look at how spending amidst the delta variant is holding up in advance of the holiday season. A consensus estimate from Briefing.com predicts retail sales dropped 0.7% after declining 1.1% in July.

Data released earlier this week from China showed that retail sales struggled in August, increasing just 2.5% compared to a year earlier. That was much weaker than expected and a dramatic slowdown from the 8.5% uptick recorded in July.