Wintry mix spreads across Minnesota

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By Anne D'Innocenzio and Dena Potter, Associated Press Writers

Fredricksburg, Va. (AP) - Once a month, just after midnight, the
beeping checkout scanners at a Walmart just off Interstate 95 come
alive in a chorus of financial desperation.

      Here and at grocery stores across the country, the chimes come
just after food stamps and other monthly government benefits drop
into the accounts of shoppers who have been rationing things like
milk, ground beef and toilet paper and can finally stock up again.


      Shoppers mill around the store after 11 p.m., killing time until
their accounts are replenished. When midnight strikes, they rush
for the checkout counter.


      "The kids are sleeping, so we go do what we've gotta do. Money
is tight," Martin Young said as he and his wife pushed two carts
piled high with ground beef, toilet paper and other items.


      The couple said they need food-stamp benefits, which are
electronically deposited onto debit cards, because his job as a
restaurant server doesn't quite cover expenses for their five
children.


      "We try to get here between 10:30 and 11 because we know we've
got a lot of stuff to get. That way by 12 o'clock we're at the line
cashing out and done," he said.

      More than a year after the technical end of the Great Recession,
millions of Americans still have a hard time stretching their
dollars until the first of the month, or even the next payday.


      One in seven Americans lives in poverty, and more than 41
million are on food stamps, a record. Last year the figure was
about 35 million.


      As a result, there are more scenes like the one last week at a
24-hour Kroger in Cincinnati. As the final hours of September
ticked down, about five dozen cars were in the parking lot. It's
much slower on normal weeknights.


      "This here is emergency bread," said Malinda Patterson, 36,
who has been without a full-time job since the recession began and
had started shopping 20 minutes before midnight. That's when $435
in food stamps kicked in to help feed her six children.

      The same night, Shavon Smith and her four young children were
loading up on meat, fruit, bread, water, tissues and cereal at
Kroger's Food 4 Less store on Chicago's West Side. Those staples
had begun running out more than a week earlier.


      "Tonight, they were tired and hungry, so I said, 'Let's go
ahead and do it now,"' said Smith, who had $600 in food stamps
electronically deposited to her electronic debit card at midnight.


      "They can go to the fridge and get whatever they want in the
beginning of the month, and we have bigger meals," a reprieve from
the rationing that is the rule for the rest of the month, she
added.

      Stores have always noted swings in spending around paydays - a
drop-off in buying in the days before shoppers receive paychecks or
government subsidies, followed by a spurt of spending once the money is available.


      The recession and its aftermath have taken the trend to an
extreme. Tight credit is a factor, too. When cash runs out, many
can no longer fall back on credit cards to buy what they need.


      There is no broad data on the impact of this shopping pattern,
known as the paycheck cycle. The timing of government assistance is
different from state to state, and when payday falls varies by
employer.


      But stores have learned how to adapt to the surges, which
typically occur on the first and the 15th of the month, when many
people get their paychecks. They monitor the pay schedules from big
employers in the towns where they operate.


      Walmart, Kroger, Kmart and others have worked with their
suppliers to stock more gallons of milk and supersized packages of
toilet paper and detergent at the beginning of the month. Smaller
packages and store brands are given prominence leading up to
payday.


      Walmart is collaborating with vendors to offer even smaller
sizes for under a dollar to win back customers who are heading to
dollar stores to buy mini-size laundry soap and other items because
they only have a few dollars left until the next payment. Earlier
this year, Kmart began pushing $1 items on snack packs and other
food items, timed a week before the 15th of each month to help
customers stretch their budgets.


      "This is the new normal," said Richard Hastings, macro and
consumer strategist with Global Hunter Securities. "This is going
to be like this for many years to come."


      Not counting Social Security, one in six Americans now receives
some form of government assistance, including food stamps, Medicaid
and extended unemployment benefits.


      These government payouts now account for about 20 percent of
Americans' total after-tax income, said David Rosenberg, an
economist at investment firm Gluskin Sheff. The average over the
past half-century is 13 percent.


      The high number of people on government assistance is atypical
for this stage of an economic recovery. Usually at this point,
growth in assistance rolls should be flattening, Rosenberg said.


      Americans relying on government benefits are doing their
homework to stretch the payments. The vast majority interviewed by
The Associated Press as October dawned last week were carefully
scrutinizing prices and had a game plan of what to buy where.


      In Harlem, shoppers were running back and forth from Target to
Costco to compare prices just after 10 a.m., the time most of the
stores open, on the first day of the month.


      Sandra Bennerson, 66, who is retired and gets Social Security on
the first, was in the detergent aisle at Target, explaining to a
reporter why Costco had a better deal on Tide. Costco was offering
20 more ounces for the same price.


      In Cincinnati, Patterson said she had learned how to budget. She
said she hopes the midnight shopping ends soon.


      "It's going to be getting colder," Patterson said.
"Hopefully, it won't be like this much longer."

      D'Innocenzio reported from New York. AP Business Writer Dan
Sewell in Cincinnati and Associated Press Writer Tammy Webber in
Chicago contributed to this report.
      

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Once a month, just after midnight, the
beeping checkout scanners at a Walmart just off Interstate 95 come
alive in a chorus of financial desperation.

Midnight grocery runs capture economic desperation

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