SNAP Delivers Vital Assistance and Is Good for the Economy

17 Jul 2015 | Ellen Vollinger, Food Research and Action Center
SNAP Delivers Vital Assistance and Is Good for the Economy

By Ellen Vollinger, Food Research and Action Center

Retailers across the country are finding that the Supplemental Nutrition Assistance Program (SNAP, formerly known as the Food Stamp program) is important for the communities they serve — and important for businesses. Long considered the nation’s first line of defense against hunger, SNAP delivers vital and targeted food assistance to millions of people who have fallen on hard times. Less talked about, however, is the business case for SNAP: how it positively impacts economies and retailers by expanding access to healthy food and by increasing people’s purchasing power.

SNAP recipients are struggling with very low incomes from work, Social Security, or unemployment so SNAP benefits are spent quickly. These benefits infuse the economy with additional spending — each dollar spent in SNAP benefits generates nearly double that in the local economy according to the U.S. Department of Agriculture (USDA). Ninety-seven percent of benefits are redeemed within the month of issuance. SNAP benefits ripple throughout the food retail industry by helping to pay the salaries of the grocery clerks, pay the truckers who haul the food and produce across the country, and go to the farmer who grows the crops.

Efforts are under way to better utilize USDA programs and policies that would promote wider access to healthy food and to support local economies. The Food and Agriculture Policy Collaborative — of which the Food Research and Action Center (FRAC) is a member — compiled a list of these resources, many of which look at ways to protect and improve SNAP, increase fruit and vegetable incentive programs for SNAP participants, use funding from the Healthy Food Financing Initiative, and strengthen marketing opportunities and the supply chain infrastructure.  All of these can go a long way to building opportunities for grocers to expand and maintain locations in typically underserved areas (known as food deserts).

Positive changes to SNAP would bolster its ability to fight hunger and to improve economic security. For example, the current benefit level is based on an outdated plan for emergency diets. Currently, the average benefit is about $1.40 per person per meal. Families are running out of resources for food by the third or early in the fourth week of the month. There are a host of reasons why benefit levels should be increased, but they all boil down to one simple fact: higher benefits would give people more purchasing power to buy a month’s worth of healthier food for themselves and for their families.

A study conducted by Moody’s Economy.com showed how effective an increase in SNAP benefits would be. “If someone who is literally living paycheck to paycheck gets an extra dollar, it’s very likely that they will spend that dollar immediately on whatever they need — groceries, to pay the telephone bill, to pay the electric bill,” said Mark Zandi, economist. Research by Children’s HealthWatch charted the positive impact that increased SNAP benefits had on children’s health.

Or take it from Dan Saltzman, the president of Dave’s Markets in Northeast Ohio. Noting just how narrow profit margins are for grocers, he pointed out that a November 2013 cut to SNAP impacted his stores. “When you have a store that does 40 percent sales in food stamps and you take a 7 percent cut in people’s ability in those areas to buy food, the math doesn’t work in a one percent business.  It’s devastating,” he commented.

Unfortunately, some in Congress are seeking to change SNAP in ways that would further reduce benefit levels or force millions of struggling people off the program. This is not the way to go.

It’s time to start talking about how well SNAP is working for people, for communities, and for retailers, and how to expand its effectiveness. Get involved by visiting FRAC’s website to learn more about SNAP and how it works and share these facts with leaders in your community.

*The views and opinions expressed in this article are those of the author and do not necessarily reflect the position of The Healthy Food Access Portal.