NC Budget and Tax Center

SNAP Processing Delays Harm Economy Too

The delays in processing applications for the Supplemental Nutrition Assistance Program (SNAP) are making it more difficult for struggling families to put food on the table.  But it is also having an economic impact too.

SNAP benefits are spent immediately and locally at retailers and grocery stores on the very basics that a family needs to get by.  As of January 21, 2014, the USDA reports that 23,000 households are being affected by the backlog at NC DHHS.  Delays in processing very often mean households do not receive benefits.  This in turn reduces the dollars spent at businesses and thus those businesses’ ability to meet payroll, spend or invest.

The USDA finds that in the Great Recession and recovery every $1 in SNAP benefits, which are paid for entirely by the federal government, generates $1.79 in economic activity.

What has North Carolina lost as a result of the delays in processing applications?

  • Those 8,327 folks who have been waiting for 3 months represent a loss of $1.8 million in economic activity because benefits have not been paid.
  • Assuming the remaining 14,673 households with applications pending were just delayed a month (and it appears likely that that is an underestimate), the loss to the economy is $3.2 million.
  • A conservative estimate then is that the total impact would be roughly $5 million in economic activity lost at a time when the recovery is very fragile indeed and needs consumers spending to sustain progress.

For families, missed meals can’t ever be made up.  And for North Carolina, lost economic activity from ongoing delays in the processing of SNAP applications can’t be easily undone.

One Comment

  1. LayintheSmakDown

    January 30, 2014 at 6:33 pm

    But they should help the economy too. The dollars not handed out are then not borrowed, saving interest costs at a minimum…..you did know we are borrowing all this money in the first place?