Study: Guaranteed income improved people’s health during pandemic

Associate Professor Amy Castro of Penn’s School of Social Policy & Practice (SP2) is co-author of the final results announced today from the Stockton pilot program, which show connections between financial security and better health.

(Stockton, CA) — People who received $500 monthly cash payments for two years as part of the Stockton Economic Empowerment Demonstration (SEED) reported improved physical health during the Covid-19 pandemic as a result of increased financial assistance, according to the final program evaluation published today in the Journal of Urban Health. The findings build on interim results of the SEED program published in 2021 in which payment recipients prior to the pandemic reported steadier monthly incomes, less anxiety and stress, and an easier time securing full-time employment.

“Our findings show that guaranteed income programs mitigate the negative financial and health consequences associated with income volatility,” said Dr. Amy Castro, co-author of the study and the co-founder and director of the Center for Guaranteed Income Research at the School of Social Policy & Practice at the University of Pennsylvania. “A national guaranteed income program that complements our nation’s current social safety net could profoundly impact people’s overall health and economic well-being.” 

Led by former Mayor Michael Tubbs and funded by philanthropic contributions, the SEED program provided 131 residents of Stockton, CA with $500 monthly cash payments between February 2019 and January 2021. Each recipient lived in census tracts at or below the city’s median household income level of $46,033; participants were permitted to use the money as they saw fit. Researchers employed a mixed methods evaluation of quantitative and qualitative data — supported by the Robert Wood Johnson Foundation’s Evidence for Action program — that measured participant impact against a randomized control group of 200 other city residents who did not receive payments. 

While the program had a greater impact on people’s finances prior to the upheaval caused by Covid-19, the final study — the first to evaluate the program’s full results via peer review — determined that certain noteworthy trends held steady both before and during the pandemic. Participants used the payments to manage risk and support themselves and their families through and beyond the study period. They also reported increased financial independence and self-sufficiency.   

“Every person in the United States, regardless of who they are and where they live, should have the resources necessary to support themselves and their families,” said Claire Gibbons, senior program officer at the Robert Wood Johnson Foundation. “Given the clear connections between financial health and physical health and wellbeing, this study shows the potential for a guaranteed income benefit to transform people’s lives.” 

“The world has changed in completely unpredictable ways since we first began SEED, but the need for a guaranteed income is greater than ever. Despite a global pandemic, I’m heartened that key factors such as no negative employment impacts, lowered income volatility and improved physical health were consistent over such a tumultuous time period,” said former Stockton Mayor Michael Tubbs. “Fortunately, we now have more than 40 pilots generating data under more stable circumstances, and we have national evidence that unrestricted cash is swift and effective with the tremendous success of the expanded Child Tax Credit.”

Media Highlights

CNN Health: Project that gave $500 a month to some California residents shows that such efforts could have a ‘profound impact on public health, researchers say

CBS News MoneyWatch: In one California city, offering free cash helped fight poverty and COVID

Penn Today: Guaranteed income improved people’s health during the pandemic

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. We provide 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’s team led the design and research for the Stockton Economic Empowerment Demonstration (SEED). CGIR is housed at the School of Social Policy & Practice at the University of Pennsylvania.

About Penn’s School of Social Policy & Practice (SP2)

For more than 110 years, the University of Pennsylvania School of Social Policy & Practice (SP2) has been a powerful force for good in the world, working towards social justice and social change through research and practice. SP2 contributes to the advancement of more effective, efficient, and humane human services through education, research, and civic engagement. The School offers five top-ranked, highly respected degree programs along with a range of certificate programs and dual degrees. SP2’s transdisciplinary research centers and initiatives — many collaborations with Penn’s other professional schools — yield innovative ideas and better ways to shape policy and service delivery. The passionate pursuit of social innovation, impact, and justice is at the heart of the School’s knowledge-building activities.

About SEED 

The country’s first mayor-led guaranteed income program launched by former Stockton Mayor Michael Tubbs, SEED distributed $500 a month for 24 months. The cash was unconditional, with no strings attached and no work requirements, and recipients were selected randomly from neighborhoods at or below Stockton’s median household income.

About Evidence for Action

Evidence for Action (E4A) is a national program of the Robert Wood Johnson Foundation, with direction and technical assistance provided by the University of California, San Francisco. Evidence for Action funds investigator-initiated research to build a culture of health that enables all members of society to lead healthier lives now and for generations to come. E4A grantees conduct innovative, rigorous research on the impact of programs, policies and practices on health and racial equity.