Report: Newark guaranteed income pilot shows positive financial, health, family, and housing impacts 

The two-year Newark pilot was designed to investigate lump-sum and recurring cash payments.

New research from the Center for Guaranteed Income Research (CGIR) at Penn’s School of Social Policy & Practice (SP2) offers insight into the efficacy of different forms of unconditional cash transfers and reveals the positive impact of guaranteed income on low-income families in Newark, NJ. 

Launched in 2021 by Mayor Ras J. Baraka in partnership with Mayors for a Guaranteed Income, The Newark Movement for Economic Equity (NMEE) guaranteed income (GI) program provided 400 low-income residents with $6,000 per year over two years. Half received the funds as recurring payments of $250 every two weeks, while the other half received lump-sum payments of $3,000 every six months. A control group of 478 other residents who did not receive cash was studied in comparison.

“This model was designed to provide actionable evidence to federal- and state-level policy makers about how to most effectively structure unconditional cash payments,” write Nidhi Tandon, Dr. Stacia West, Dr. Elizabeth DeYoung, Henisha Patel, Dr. Allison Thompson, and Dr. Amy Castro of CGIR.

The findings, released in a primary report and supplemental document on housing outcomes, show connections between the unconditional cash transfers and improvements in:

• Financial outcomes: Recurring payments reduced income volatility, improved food security, and boosted participants’ ability to handle emergency expenses. Lump-sum recipients reported savings exceeding $500 and were able to use cash to manage unexpected costs.
• Health and mental health: Recipients of recurring payments reported lower psychological distress and improved physical functioning over time. Lump-sum recipients also reported improved physical functioning.
• Housing stability: Recurring payments helped recipients consistently pay rent and maintain stable housing, while lump sums enabled larger housing changes, such as moving or buying furniture. 
• Parenting and education: Recipients across both groups reported more quality time with children and less household chaos. Households receiving the cash transfers saw improved grades and increased AP course enrollment.

“Poverty is the result of failed policy, period. We structured the NMEE to gather scientific data about the best format for cash interventions, so that state legislators could adopt a proven model,” said Newark Mayor Ras J. Baraka. “Now that we have results, it’s time for action. Ending poverty will make our neighborhoods safer, our cities healthier and our state more resilient.” 

One participant commented, “It’s guaranteed … I can look forward to and depend on [it], so it is allowing me that space to actually plan what I’m going to do with it. It allows me to save, because I can use this money … to pay for things that I would have to take out of my paycheck to pay for.”

Participants used recurring funds to cover routine costs like rent, utilities, groceries, and childcare. Lump-sum recipients leveraged larger payments to make investments such as car repairs, apartment deposits, or paying bills in advance. While lump-sum disbursements allowed for major financial decisions and immediate improvements, recurring payments offered consistency and helped families plan ahead. 

“The majority of pilot participants preferred a recurring GI due to the regularity of the payments,” the researchers say. “It seems that the consistent nature of recurring payments allowed participants to not only secure temporary financial stability, but to reduce the related cognitive burden of making ends meet.”

The findings also suggest that starting with a lump-sum payment followed by recurring payments can be an effective way to help recipients establish financial security and sustain it over time. 

Newark residents were eligible to participate in NMEE if they had an income below 200% of the federal poverty line and were negatively impacted by the COVID-19 pandemic. The program is part of the City of Newark’s broader efforts to promote economic growth, health equity, and educational opportunity. 

About the Center for Guaranteed Income Research

The Center for Guaranteed Income Research (CGIR) is an applied research center specializing in cash-transfer research, evaluation, pilot design, and narrative change. CGIR provides mixed-methods expertise in designing and executing empirical guaranteed income studies that work alongside the existing safety net. Headed by its founding directors, Drs. Amy Castro and Stacia West, CGIR is housed at the School of Social Policy & Practice at the University of Pennsylvania.

About Penn’s School of Social Policy & Practice

Founded in 1908, the School of Social Policy & Practice (SP2) is known for its commitment to the passionate pursuit of social innovation, social impact, and social good. SP2 prepares changemakers to work tirelessly for more effective, efficient, and humane human services through education, research, and civic engagement. Ranked #8 nationally among Schools for Social Work, SP2 develops transdisciplinary research and offers five highly respected degree programs — Master of Social Work,Master of Science in Social Policy,Master of Science in Nonprofit Leadership, Doctorate in Clinical Social Work,and Doctor of Philosophy in Social Welfare — along with a range of certificate programs and dual degrees.