Economics

Food Stamp Rush Hour


Just before midnight on Nov. 30, swarms of shoppers at the Wal-Mart (WMT) Supercenter in North Bergen, N.J., fill their carts with milk, bread, cereal, vegetables, baby food, and more. Some hold crying or sleeping infants. Others have brought along elderly relatives who cruise the aisles in scooter carts. Nearly everyone is yawning.

At about 11:50 p.m., long, winding lines start to form at the three open checkout lanes. The manager takes to the storewide PA to summon all cashiers to their posts. As the clock strikes 12, the lines move slowly forward. Almost all the customers pay with swipe cards and linger over brimming carts to double-check foot-long receipts for errors.

It’s a monthly event, and a sign of the times. On the last day of every month, at 24-hour Wal-Marts, food stamp recipients line up to make essential purchases just as their federal benefit cards recharge for the new month.

News of the trend was first broken by William S. Simon, Wal-Mart’s U.S. chief executive officer. At a Goldman Sachs (GS) conference in September 2010, Simon told investors that on the last day of the month, “it’s real interesting to watch. About 11 p.m., customers start to come in and shop, fill their grocery basket with basic items … and mill about the store until midnight. Our sales for those first few hours on the first of the month are substantially and significantly higher. If you really think about it, the only reason somebody gets out in the middle of the night and buys baby formula is that they need it, and they’ve been waiting for it.” Executives at Dean Foods (DF) and grocery chain Kroger (KR) have said as much in investor calls this year.

According to the U.S. Agriculture Dept., the Supplemental Nutrition Assistance Program (food stamps) has grown from 26 million recipients five years ago to a record 46 million today. The U.S. Census Bureau says nearly 50 million Americans are living in poverty, the highest figure since recordkeeping began 52 years ago. The bureau calculates that 6 million more people would be living in poverty were it not for a temporary increase in the earned-income tax credit. And without food stamps, an additional 5 million Americans would fall below the poverty line.

“That is my reality,” says Lois Marcucci, a single mother who was first to swipe her benefit card just after midnight on Oct. 1 at a Wal-Mart in Richmond, Va. Looking over at her two teenagers pushing her cart filled with food, she says she can no longer pay her phone bill. “You can’t make ends meet,” she says, catching her breath. “I’m month to month.”

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Farzad is a Bloomberg Businessweek contributor. Follow him on Twitter @robenfarzad.

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Companies Mentioned

  • WMT
    (Wal-Mart Stores Inc)
    • $76.39 USD
    • 0.04
    • 0.05%
  • GS
    (Goldman Sachs Group Inc/The)
    • $186.08 USD
    • -0.24
    • -0.13%
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