How Big Food Corporations Take Advantage of SNAP
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Congress is anticipating a battle over the Supplemental Nutrition Assistance Program (SNAP, formerly known as “food stamps”) during negotiations around the next food and farm bill. Republicans are trying to limit SNAP benefits, which help put food on the tables of one of every eight people in the United States—including many working households. Ironically, food workers tend to have the highest participation in SNAP among all workers, and many of them work for corporations that spend millions lobbying Congress (to the tune of $165 million in 2022) and paying executives.
The most recent discussion revolves around work requirements for SNAP users, an argument that resurfaces every now and then. SNAP already requires all adults to register for work, participate in job training, or work at least 30 hours a week (and has even stricter requirements for able-bodied adults without dependents). While almost one-third of SNAP recipients receive an earned income, more than two-thirds are not expected to work because they’re children, are living with a disability, or are older adults.
One in 10 workers in the United States live in a household that receives SNAP due to low wages, inconsistent work schedules, and no paid sick leave. National data show that among adult wage earners who are SNAP recipients, 70 percent worked full-time every week, and more than half worked the full, or nearly full, year. If companies are paying workers so little—or designing schedules that avoid the requirements of full-time employment—that their workers must depend on public assistance, are taxpayers subsidizing low wages and high corporate profits?
How many working people on SNAP are food workers?
Food workers are the people who make sure food gets to our plates: they farm, process, transport, and package our food, then prepare it and sell it to us. According to national averages between the years 2015 and 2017, among farming, fishing, and forestry workers, 19 percent are SNAP recipients. Among food preparation and serving workers, 18 percent receive SNAP. For cashiers (across all retail), it’s 23 percent. This means food workers are roughly twice as likely to need SNAP as the average US worker.
However, not everyone who is (or should be) eligible for SNAP receives it. Nationally, eligible workers’ participation in SNAP varies. In California and Wyoming, for example, only 59 and 55 percent of eligible workers use SNAP, respectively. And in some cases, entire groups of workers are prevented from accessing SNAP: workers born in the Marshall Islands, most of whom live in Arkansas, don’t qualify because of an old federal law (a new bill to address this was introduced in 2021 according to a congressional database, but the status remains unchanged). Finally, a national survey shows that only 13 percent of farmworkers receive SNAP, despite their low wages and the fact that they are more likely to experience food insecurity. A language barrier and fear of authorities may be contributing factors. Overall, the numbers tell us many more workers could, or should, be receiving SNAP.
Large corporations benefit from workers’ low wages
National data on workers who receive SNAP does not include information about specific employers. Luckily, a study released in 2020 can help us understand the kinds of employers whose low wages force their workers to rely on SNAP. The report is limited to nine states—Arkansas, Georgia, Indiana, Maine, Massachusetts, Nebraska, North Carolina, Tennessee, and Washington—but it points directly to food corporations as the main culprits.
In Arkansas, for example, large companies that work across the food chain (but may sell other products as well) employed 5,974 workers who received SNAP, which means that at least one of every seven working adults who received SNAP in Arkansas worked for a food system corporation. Based on the average SNAP benefit (prior to SNAP expansion due to the pandemic in 2020) for working households in Arkansas, I estimate that food system employers in the state benefited from more than $21 million a year in indirect “subsidies”—in other words, these corporations allow SNAP benefits to compensate for the low wages they pay. One must wonder, what does this number look like nationally?
The story repeats in all nine states. Walmart and McDonald’s were the corporations with the most employees using SNAP. Among grocery chains, Walmart is rivaled by Kroger (which owns Safeway and recently announced controversial plans to merge with Albertsons) and Ahold Delhaize (a Netherlands-based corporation that owns Food Lion, Hannaford, Stop and Shop, and others). Kroger has been arguing that it needs to merge with Albertsons in order to compete with Walmart, but policymakers should be asking what will happen to workers’ wages if they have fewer employment options?
Tyson Foods, which we have called out regularly for putting workers’ health and safety at risk while paying low wages, is the only food processing company that finds itself on this shameful list. Tyson has workers who receive SNAP in two states in this study, Arkansas and Nebraska, but Tyson has plants in 22 other states. What would their numbers look like? Tyson also has complex contracts with chicken farmers who receive low wages but, because they are not employees, do not appear on this list, underreporting the influence Tyson has on its contractors.
Why do food chain workers qualify for SNAP?
The hard truth is that the minimum wage in this country, $7.25 an hour, keeps people in poverty. To be eligible for SNAP, annual household gross income must fall within 130 percent of the poverty threshold after some deductions. For an individual, this is $18,954 and for a family of four, $39,000. Even if someone being paid minimum wage worked every weekday of the year (earning $15,080 for an individual or $30,160 for a household of four with two earners), they would still qualify for SNAP.
Higher wages can make someone ineligible for SNAP: roughly $9.10 per hour to get above the 130 percent poverty threshold for an individual, but $12.30 per hour for a single parent with one child—barely over the minimum wage in Arkansas ($11 per hour) without taking a single break all year.
Low-paying jobs tend to be volatile, and people are often forced to change jobs, sometimes multiple times a year. SNAP can be an important aid to supplement occasional low wages and to help workers make do during emergencies and job changes, but that should not be an excuse to allow corporations to continue paying low wages.
What can the food and farm bill do?
Federal nutrition programs constitute a large portion of the food and farm bill. This is undeniably a good thing, as it helps millions of households put food on their tables. What should be concerning is that millions of people in this country work full-time, year-round, and still need to supplement their food budget with SNAP—and many more who may be struggling are not eligible. How is it acceptable that the corporations they work for bring in billions of dollars—and pay their executives millions—while their workers struggle to make ends meet?
The truth is that big corporations have hijacked our food system and put the well-being of their workers at risk. What the Union of Concerned Scientists wants to see in the new food and farm bill in 2023 is more attention to how corporations benefit from the status quo. I showed here that big food corporations that have consolidated over time continue to enrich themselves while their workers are struggling. We previously shared one such case study on the impact of Tyson Foods on Arkansas communities. The federal government should hold companies like Tyson accountable, while continuing to provide the lifeline of SNAP.
Finally, we need to realize that these corporations are getting away with not only paying low wages but also owning the stores where SNAP recipients shop. Due to consolidation in the grocery sector, many households have no choice but to buy food from the very corporations that do not pay them enough to afford food without SNAP. Walmart alone captures about 18 percent of all SNAP spending.
Investment in local and regional food systems can bring new, better-paying jobs as well as opportunities for SNAP dollars to produce local economic benefits. Some government programs that promote local and regional systems report that for each dollar invested, more than $2.67 goes to the local community. For one program that subsidizes fresh fruits and vegetables, the impact is two dollars for every dollar invested.
SNAP benefits should not be up for debate. Lawmakers need to remember that SNAP is an important program that helps millions of households across the United States thrive. Instead of shrinking it, they need to expand it. Then they can transform our food system so it serves communities—and our planet.