After getting $500 per month for two years without rules on how to spend it, 125 people in California paid off debt, got full-time jobs and reported lower rates of anxiety and depression, according to a study released Wednesday. The program in the Northern California city of Stockton was the highest-profile experiment in the U.S. of a universal basic income, where everyone gets a guaranteed amount per month for free…
Stockton was an ideal place, given its proximity to Silicon Valley and the eagerness of the state’s tech titans to fund the experiment as they grapple with how to prepare for job losses that could come with automation and artificial intelligence. The Stockton Economic Empowerment Demonstration launched in February 2019, selecting a group of 125 people who lived in census tracts at or below the city’s median household income of $46,033. The program did not use tax dollars, but was financed by private donations, including a nonprofit led by Facebook co-founder Chris Hughes.
A pair of independent researchers at the University of Tennessee and the University of Pennsylvania reviewed data from the first year of the study, which did not overlap with the pandemic. A second study looking at year two is scheduled to be released next year. When the program started in February 2019, 28% of the people slated to get the free money had full-time jobs. One year later, 40% of those people had full-time jobs. A control group of people who did not get the money saw a 5 percentage point increase in full-time employment over that same time period.
“These numbers were incredible. I hardly believed them myself,” said Stacia West, an assistant professor at the University of Tennessee who analyzed the data along with Amy Castro Baker, an assistant professor at the University of Pennsylvania.
The Stockton mayor who’d started the program told reporters to “tell your friends, tell your cousins, that guaranteed income did not make people stop working.”