Posted by Paul Lopatto, October 22, 2009

Earlier this week it was widely reported that the number of homeless families had hit a record high in the city. Less noticed has been another record increase: As of August there were nearly 1.6 million New Yorkers on the food stamp rolls.

The rapid increase in food stamp enrollment began in early 2008, following years of relatively slow growth. From January 2008 through August 2009 food stamp enrollment increased by 354,000 persons, expanding the caseload by nearly 30 percent. Based on the current average monthly grant, the increase of food stamp recipients over the same period should result in about $680 million annually in additional federal assistance to low-income city residents, a level that’s juiced by the increase in benefits under the stimulus act.

While food stamp enrollment has fluctuated significantly over the last few decades, the pace of growth over the last year and a half has been unmatched since the early years of the program in the 1970s. It is likely that some of this growth can be attributed to policy initiatives by both city and state officials to increase the share of eligible people who enroll in the program.

At the city level, the application has been shortened and the hours of operation at some food stamp offices has been lengthened. As part of a statewide initiative the city’s Human Resources Administration has also been implementing new systems that make better use of information technology to allow for off-site electronic filing of applications and supporting documents, and recertification of some cases over the phone. In 2008 the social services agency also performed a data match to identify Medicaid recipients who might be eligible for food stamps but never applied, and then did a targeted outreach campaign to encourage them to fill out applications.

While these outreach efforts and initiatives to ease the application process helped boost enrollment, the extensive job losses and resultant income decreases experienced by large numbers of New Yorkers over the last year have significantly increased the pool of people who are eligible for assistance. Evidence from previous economic downturns, as detailed in IBO’s 2008 report Most Food Stamp Recipients No Longer Also Welfare Recipients, suggests that further labor market declines are likely to lead to continued growth in the food stamp caseload. Comparisons with prior recessions, however, serve to highlight the unprecedented magnitude of the recent caseload increases. Monthly food stamp enrollment growth since September 2008 has occurred at three times the rate seen in the last downturn that began in 2001.

The combined effects of the more user-friendly policies and rising economic distress have pushed the city’s food stamp caseload beyond its previous peak of 1.46 million people in April 1995. But current recipients differ from their earlier counterparts in one important respect. In 1995 nearly 80 percent of food stamp recipients also received public assistance; today only about one-quarter also receive welfare benefits.

This separation of food stamps from public assistance began with the implementation of welfare reform policies in the mid-1990s and has continued since. Recent caseload numbers offer further confirmation of the severing of these programs. From September 2008 through August 2009, with the local job market faltering, the number of city residents receiving food stamps increased by 258,000 or 20 percent while the public assistance caseload increased by only 13,000 or 4 percent. This suggests that while negative public attitudes and restrictive government policies toward welfare persist, food stamps have become an increasingly acceptable form of low-income assistance.

This trend is not unique to New York; federal statistics indicate that the divergence of these two key income support programs is progressing on a nationwide basis. From January 2008 to July 2009 food stamp enrollment increased by 29 percent to a record high 35.9 million recipients. While federal welfare caseload numbers are not yet available for 2009, the data indicate that during 2008, with the national recession underway, the number of food stamp recipients increased by 15 percent compared to only 4 percent for public assistance. Although high levels of unemployment could eventually lead to a more rapid movement of out-of-work people onto the welfare rolls, the delinking of food stamps and welfare is likely to persist.