New Report: Nutrition Programs are Critical Supports During Economic Downturns

Oct 17, 2012

By Elizabeth Lower-Basch, Helly Lee and Lavanya Mohan

A recent study by the United States Department of Agriculture (USDA) shows that economic conditions influence all major nutrition assistance programs. Past studies have documented the relationship between economic conditions and participation in the Supplemental Nutrition Assistance Program (SNAP, or food stamps). However, this is the first study to analyze the relationship between economic conditions and participation in all the major nutritional assistance programs which include SNAP; the Special Supplemental Nutrition Program for Women, Infants and Children (WIC); the National School Lunch Program (NSLP); the School Breakfast Program (SBP) and the Child and Adult Care Food Program (CACFP).

The study examines the impact of economic conditions on program participation in addition to looking at how program policy and other demographics also affect participation.

Between 1976 and 2010, the study finds that all major nutritional assistance programs were - in varying degrees -- countercyclical to economic conditions, meaning that they expanded during economic downturns and contracted during times of economic growth. SNAP caseloads, especially, rose immediately as unemployment rates increased. However, when unemployment rates decreased, the SNAP caseload decrease lagged behind, possibly due to the economic recovery taking longer to reach low-wage workers and low-income families.

During the last three periods of economic decline, students receiving free or reduced price lunches (through NSLP) increased by an average of 1 to 4 percent per year. Moreover, laws such as the Child Nutrition and WIC Reauthorization Acts of 1989 and 2004 allowed for easier access and enrollment of children in the NSLP program, further increasing participation. Similarly, during these recent periods of economic decline, there was an increase in students receiving free and reduced-price meals through both SBP and CACFP.

The most recent economic decline period of 2008 to 2010 saw the largest increase in SNAP and WIC participation, far exceeding previous periods of economic downturn. SNAP participation was also boosted by the temporary increase in benefits that was part of the American Recovery and Reinvestment Act. This increase is now scheduled to expire on October 31, 2013. As the USDA reports, through July 2012, on average, 46.4 million individuals participate in SNAP per month; 8.9 million participate in WIC and 21 million children participate in the NSLP, receiving free and reduced price lunch every day.

The USDA report underscores that federal nutritional assistance programs are critical in helping millions of low-income families and children during economic downturns. As Congress continues budget deficit talks, it is important to ensure that they preserve nutritional assistance programs that positively impact needy families, especially when the economy is slowly recovering. Moreover, while SNAP caseloads have not yet begun to decline, even though unemployment has started to fall, we know from previous downturns that there is often a lag before participation rates fall commensurately with the drop in unemployment. 



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