Recent trends in spending patterns of Supplemental Nutrition Assistance Program participants and other low-income Americans
Using Consumer Expenditure Survey data for the period 2004–2010, this article examines spending on food by Supplemental Nutrition Assistance Program (SNAP) participants, whether this spending changed over time, whether participants spent more on food than did program nonparticipants, and whether spending on nonfood goods and services differed between participants and nonparticipants. The article found that spending on food at home increased since 2006 by a greater amount for SNAP participants than it did for eligible nonparticipants, with participants’ spending eventually surpassing nonparticipants’ spending by 2010. As the largest share of total spending, housing expenditures increased steadily for both participants and nonparticipants, with SNAP participants spending amounts similar to those spent by eligible nonparticipants.
As the largest federal nutrition assistance program, the Supplemental Nutrition Assistance Program (SNAP) ensures that low-income Americans have adequate access to food by providing them with an in-kind benefit to be spent on food each month. With nearly 44.5 million individuals participating in SNAP in an average month in fiscal year 2011 and with $71.8 billion spent on benefits in fiscal year 2011, it is important to assess how much SNAP participants spend on food each month, whether this spending amount has changed over time, and whether SNAP participants spend more on food than do nonparticipants.1
The amount a household spends on food is not decided in isolation, but as part of a decision how to best allocate resources (income) across various goods and services, including rent or mortgage payments; utilities bills, such as electric and telephone services; transportation; and education. Although extensive research has been conducted on how households distribute their resources across broad groups of goods and services,2 little research has focused on how these distributions differ across groups of low-income households. This is especially true for households participating in, eligible for, or nearly eligible for SNAP.
This article uses data from the Consumer Expenditure Survey (CE) for the period 2004–2010 to examine trends in expenditures on major budget categories of goods and services for SNAP participants, program-eligible nonparticipants, and higher income nonparticipants. The analysis is repeated by looking at expenditure shares, defined as the percentage of total expenditures spent on each category of goods and services. Next, the article compares expenditures in 2010, the most recent year for which data are available, on specific (minor) budget categories across the three participation and eligibility groups.
The analysis relies on CE data for the period 2004–2010. The CE, which has been conducted for the Bureau of Labor Statistics (BLS) since 1980, collects data on consumer expenditures for goods and services used in day-to-day living. It also collects information on demographic characteristics and annual household income. The survey allows data users to relate the expenditures and income of consumers to the demographic characteristics of those consumers.
The CE consists of two separate surveys: the weekly Diary Survey and the Quarterly Interview Survey (henceforth referred to as CE Interview). The samples for the two surveys are drawn separately, and each survey has its own data collection technique. The data are released annually, with a 1-year lag from data collection to release. For example, the reference period of the 2005 CE data covers the four quarters of 2005 and the first quarter of 2006 for the CE Interview and the four quarters of 2005 for the Diary Survey. The findings in this article are based solely on estimates that use the CE Interview.
The CE Interview collects information from about 7,500 to 8,000 consumer units (families and single consumers) once every 3 months over five consecutive quarters, resulting in 38,000 to 39,000 records in the dataset.3 The survey is designed to collect information on expenditures that respondents can remember for a period of 3 months or longer. These expenditures include large purchases, such as property, automobiles, or major appliances; recurring expenditures, such as rent, utility bills, or insurance premiums; continuing expenses, such as apparel, food, and educational supplies; and other expenses, such as those related to employment and travel or vacations. The survey excludes nonprescription drugs, housekeeping supplies, and personal care products.
2 Laura Castner and James Mabli, Low-income household spending patterns and measures of poverty (U.S. Department of Agriculture, Food and Nutrition Service, 2010); Jennifer Ward-Batts, “Out of the wallet and into the purse: using micro data to test income pooling,” Journal of Human Resources 43, no. 2, 2008, pp. 325–351; Geoffrey D. Paulin and Yoon G. Lee, “Expenditures of single parents: how does gender figure in?” Monthly Labor Review, July 2002, pp. 16–37; Deanna L. Sharpe and Abdel-Ghany Mohamed, “Identifying the poor and their consumption patterns,” Family Economics and Nutrition Review 12, no. 2, 1999, pp. 15–25; Mark Lino, “Income and spending of poor households with children,” Family Economics and Nutrition Review 9, no. 1, 1996, pp. 2–13.
3 Besides containing up to four records for each of the 7,500 to 8,000 households added to the survey each year, the CE Interview contains records from the previous year for households whose survey periods extended into the beginning of the calendar year.