Guaranteed Basic Income in New Orleans supports young people with opportunities

All participants were considered “opportunity youth” – not enrolled in work or school – at the start of the pilot. They could spend their $350 a month however they chose.

The researchers released the final results of the program on September 3. According to the report, the guaranteed basic income helped some participants secure full-time employment and pursue educational opportunities.

One participant, whose name has been withheld from the report for confidentiality, told researchers they used their $350 to replace a broken laptop so they could enroll in a coding class.

“I was able to pick up the computer and solve this problem stress-free,” they said in a statement. “And it made me feel great — because if I hadn’t had it, it would have been totally different.”

The New Orleans Guaranteed Basic Income pilot program was a collaboration between Mayor LaToya Cantrell’s Office of Youth and Families and the national advocacy network Mayors for a Guaranteed Income (MGI). The research was led by the Guaranteed Income Research Center at the University of Pennsylvania, and the cash payments were largely funded by a $500,000 MGI grant.

More than 100 similar Guaranteed Basic Income programs have been launched across America, offering participants recurring cash payments for a set period of time. The cash payment model has been tried in cities like Los Angeles, Birmingham, Chicago and Denver to fight local poverty and increase access to food and housing.

Much of the New Orleans GBI’s recent efforts have been on youth. In addition to the guaranteed income for opportunity youth, the nonprofit Rooted School Foundation is giving local high school students $50 a week starting in 2022.

Still, participants in New Orleans said their guaranteed income benefits are temporary. After the pilot ended, some young people said they were still struggling to afford food and pay the bills.

Guaranteed income helps young people secure jobs and pay for housing

About one in six Louisiana youth is not working or in school — and black youth make up about half of the state’s “opportunity youth” population — according to the New Orleans report. In addition, lower educational attainment and work experience are risk factors for future poverty.

The final results of the New Orleans GBI are based on interviews and surveys with participants about their experience, as well as quantitative data on spending. Participants were surveyed at the beginning of the pilot, halfway through, at the end of the pilot, and five months after payments ended. The pilot had no control group.

Some pilot participants said they had previously been unable to hold down jobs or attend school because of home care responsibilities. But with GBI, many participants said they were able to provide financial support to their grandparents, parents or siblings.

“We recognize that when you meet people where they are, they rise to the occasion,” Asya Howlette, director of the New Orleans Mayor’s Office of Youth and Families, told BI.

Participants also had a statistically significant increase in full-time employment: Between the start and end of the program, participants’ employment rate increased from 6% to 21%, and many reported feeling more stable with their incomes. Some said the $350 gave them the financial freedom to pursue training programs and internships.

The number of participants who had a housing cost burden exceeding 50% of their income — which is considered highly rent-burdened — also fell by 15 percentage points over the course of the pilot.

A few hundred dollars a month probably doesn’t cover major expenses, but Howlette said it’s what many young people with opportunities need.

“It’s not enough to propel you into wealth,” she said. “It is enough to avoid the precipice of disaster.”

Participants struggle to pay bills after payments close

Even with employment and financial gains, many of the benefits participants felt from guaranteed basic income were temporary. The New Orleans pilot was short-lived, and participants’ feelings of hopelessness grew after payments ended.

Overall, participants did not experience a significant increase in mental health, physical health, or ability to make savings between the start and end of the pilot. Despite the monthly income, many still struggled to afford food and pay their utility bills.

The researchers, however, noted that the individualized impact of guaranteed basic income is difficult to capture in a single data set. Program leaders ca Howlette said it’s important to pay attention to anecdotes, not just numerical trends, because participants’ needs and experiences vary.

The report identified the high cost of living, low wages and poor economic conditions after the pandemic as factors that could have hampered participants’ finances. Although there are many safety net programs for children and adults, very few serve teenagers.

For Howlette, the pilot results in New Orleans show that housing, work and transportation costs are major barriers for young people to opportunity. She said the guaranteed income is just one way to help alleviate these challenges and prevent long-term poverty.

“If you’re on an anti-guaranteed income, then you have to be pro-affordable housing, access to transit, access to work and higher wages,” she said. “People have to survive in this world, and if our economy doesn’t make that possible, then we’re left with people struggling to survive.”

Have you benefited from a guaranteed basic income program? Are you open to sharing how you spent the money? If so, contact this reporter at [email protected].