Guaranteed Income Works: Data from New Orleans, LA
New Orleans Guaranteed Income Program
The New Orleans Guaranteed Income Program provided $350 a month for 10 months to 125 young people between the ages of 16-24. Initiated by Mayor LaToya Cantrell and operated by the Office of Youth and Families, the program focused on young people in Orleans Parish who were disconnected from work and school, with the goal of supporting these “opportunity youth” to connect to education and employment opportunities.
The Mayor’s Office of Youth and Families (OYF) partnered with nine community-based organizations to refer participants to the program including ALAS, Collegiate Academies, Healthy Start, New Orleans Public Schools, Youth Empowerment Project, New Orleans Youth Alliance, Louisiana Center for Children's Rights, and Educators for Quality Alternatives. In addition, OYF partnered with United Way of Southeast Louisiana to provide benefits counseling to all participants.
Key Takeaways
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The increase in full-time employment was statistically significant, going from 6 percent at the outset to 21 percent after the program. The distribution among different employment statuses was more even after the program compared to the starting point, indicating a stabilization with more participants engaged in various forms of employment, including part-time and self-employment.
Income volatility was high among participants at the outset, due to seasonal fluctuations in employment and earnings and the irregular and variable work hours associated with temporary work arrangements, By the end of the program, income volatility decreased by nearly 20 percentage points.
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Guaranteed income helped young people afford their basic needs. For most of the participants, they spent the money on basic needs like buying food, paying rent and utilities, buying school supplies and uniforms for themselves or younger siblings, and paying for transportation.
Young people spoke frequently of budgeting their family’s needs into the payments. Nearly 25% of respondents reported having provided financial support to family members in the past month, with an average contribution of approximately $170. This assistance covered a range of expenses, including housing (rent, mortgage, or security deposits), monthly bills (such as phone and utilities), medical bills, transportation costs (including car repairs or bus passes), and other volunteer services (such as yard work, home repairs, childcare, or eldercare).
Shifts in financial well-being over the course of the program indicate a positive trend over time, with fewer individuals falling into the lower well-being categories and more transitioning into higher well-being statuses.
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At the outset, over half (57%) of participants reported a housing cost burden exceeding 50% of their income, indicative of severe cost burden. Five months into the pilot, this percentage declined to 41%. By post-intervention, despite an increase in the overall average housing cost burden—reflective of the general market trends of increasing rents and housing costs—the proportion of individuals reporting extreme burdens of more than 50% stabilized at 42%.
Notably, homelessness was only reported during the Baseline evaluation, indicating a potential improvement in housing situation over time.
Occurring simultaneously with a period of historically high national inflation, the guaranteed income payments not only helped young people afford their basic needs, but also increased their financial stability, improved their employment prospects, helped ease housing cost burden and reduced other risk factors associated with economic insecurity.