Indicators of Welfare Dependence: Annual Report to Congress, 2003. Food Stamp Caseload Trends

03/01/2003

Food Stamp Caseload Trends (Tables FSP 1-2). Average monthly food stamp participation in 2001 (including participants in Puerto Rico’s block grant) was 18.4 million persons. This represents a slight increase over the 2000 record-low average. Average monthly participation fell from its peak of 28.9 million in an average month in 1994 to an average of 18.2 million persons in 2000. Both in absolute numbers and as a percentage of the population, food stamp recipiency in 2000 was lower than at any point in the previous twenty years. See also Table IND 3b and Table IND 4b in Chapter II for further data on the recent decline in food stamp recipiency and participation rates.

Considerable research has demonstrated that the Food Stamp Program is responsive to economic changes, with participation increasing in times of economic downturns and decreasing in times of economic growth (see Figure FSP 1). Economic conditions alone did not explain the caseload growth in the late 1980s and early 1990s, however. A congressionally mandated study in 1990 concluded that a variety of factors contributed to this caseload growth, including expansions in Medicaid eligibility and changes in immigration laws, particularly the legalization of undocumented aliens, as well as a rise in unemployment (McConnell, 1991). Longer spells of participation also contributed to the caseload increase, according to an analysis of longitudinal data from the Survey on Income and Program Participation (Gleason, 1998).

Economic conditions were a significant factor in explaining the drop in food stamp caseload since 1994, according to an Economic Research Service review of recent research (ERS, 2000). Several econometric models suggest that economic variables explain between 25 and 44 percent of the decline in caseload. The full effect of the economy may be even higher, to the extent that some of the unexplained variation in the models reflects local economic conditions not captured in state-level economic variables.

Policy changes, most notably the enactment of the Personal Responsibility Act of 1996, have also contributed to the recent decline in food stamp caseload. The most direct impact was the elimination of eligibility for most legal immigrants and for many childless adults aged 18-50. Participation for these two groups fell sharply between 1994 and 1998 (Genser, 1999). In addition, changes in TANF policy may have affected food stamp participation, although these effects are less certain. Many studies of families leaving TANF cash assistance have found that many of these families leave the Food Stamp Program as well, despite appearing eligible for food stamp benefits. Econometric studies of the effects of specific changes in TANF policy, however, have found that only a small share of the decline in state food stamp caseloads was associated with waivers to AFDC policies. Increased stigma about welfare use and unintentional diversion from the Food Stamp Program may be additional factors affecting food stamp participation.

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