SNAP is Tailored to the Economy- it’s a Powerful Tool

SNAP Stimulates Economic Activity During an Economic Downturn SNAP is one of the Nation's primary counter-cyclical government assistance programs. It provides assistance to more low-income households during an economic downturn or recession and to fewer households during an economic expansion, serving as an automatic stabilizer to the economy. The rise in SNAP participation during an economic downturn results in greater SNAP expenditures which, in turn, stimulate the economy. During a recession, some households that lose part or all of their incomes become eligible and participate in SNAP. Moreover, for households that were already participating before the recession, SNAP benefits increase if their income falls. Not only do SNAP benefits support a household’s food purchasing needs, benefits also augment the incomes and spending of others (such as farmers, retailers, food processors, and food distributors, as well as their employees); this, in turn, has ripple effects for other parties. Thus, SNAP benefits start a multiplier process that supports macroeconomic spending and production. SNAP participation and benefits can automatically expand when the economy weakens and contract when it strengthens. ERS research has estimated a multiplier of SNAP benefits on Gross Domestic Product (GDP) of 1.54; that is, an increase of $1 billion in SNAP benefits in a slowing economy increases GDP by $1.54 billion and supports 13,560 additional jobs, including nearly 500 agricultural jobs (farming, forestry, fishing, and hunting). See: The Supplemental Nutrition Assistance Program (SNAP) and the Economy: New Estimates of the SNAP Multiplier