The U.S. federal government has been shut down since October 1st, now entering its 28th day. If the government halts the Supplemental Nutrition Assistance Program (SNAP), also known as food stamp benefits, Walmart’s consumer spending could significantly decline, leading to approximately $2 billion in losses for Walmart throughout November.
According to a June report by market research data company Numerator, Walmart accounts for about 24% of total spending by SNAP shoppers, with the government spending approximately $100 billion a year on the program (about $8.3 billion monthly).
Based on a report by Numerator compiled from behavior data of over 31,600 verified beneficiaries and survey responses from more than 1,250 participants, Walmart saw a 5% revenue growth in the recent fiscal year amounting to $681 billion, representing 24% of spending by SNAP shoppers; Kroger at 8%, Costco at 6%, Amazon at 5%, and Walmart’s Sam’s Club at 4%.
While federal medical insurance, Medicaid, and social security benefits continue during the government shutdown, the suspension of SNAP benefits is expected to have a significant impact on over 40 million Americans reliant on the program.
The U.S. Department of Agriculture (USDA) has announced on its official website that SNAP funds will be exhausted by November 1st, at which point all benefits will cease.
The statement reads, “Funds have been depleted, and no benefits will be issued as of November 1st. Senate Democrats face a choice: either continue to provide medical coverage and gender reassignment surgery for illegal immigrants or restart government operations to ensure critical nutrition assistance for mothers, infants, and the most vulnerable groups.”
The government has earmarked around $5 billion in emergency funds to maintain the possibility of SNAP benefit issuance through November.
Economist Ismael Martinez of the Economic Policy Institute (EPI) emphasized the importance of SNAP benefits for economically fragile families, children, and the overall U.S. economy, stating, “The significance of SNAP benefits for vulnerable families, children, and the overall economy cannot be underestimated. We should do everything possible to ensure that families receive this critical support.”
Martinez further described, “Over 40 million people rely on SNAP benefits to access basic healthy foods… since 2021, the proportion of households with children facing food insecurity (17.9%) has continued to rise. In just the past year, SNAP has kept over 3.5 million people out of poverty, including over 1.4 million children.”
On October 23rd, the National Grocers Association declared that SNAP is a “robust economic engine for communities large and small,” urging bipartisan leaders in Congress to quickly seek a funding solution to restart government operations.
Jennifer Hatcher, Chief Public Policy Officer of the Food Marketing Institute, stated on October 21st, “Congress should immediately end the government shutdown to ensure that the most vulnerable Americans can continue to access essential food through the SNAP program.”
(Adapted from a report by “Newsweek”)