Photo: Chris Granger/Times-Picayune.
New Orleans 12th grader Dejah Grimes was part of a pilot program, soon to be expanded, that gives students $50 per week with no strings attached.
Paying kids to do something they should be doing anyway — for their own sake — does not always have the intended result. But I can see that to keep some teens in school, it might help. And for those who’d stay in school anyway, what a nice bonus!
Marie Fazio writes at the Times-Picayune, “Every Wednesday morning for nearly a year, Dejah Grimes woke up to a $50 deposit in her account, money she was free to spend however she chose.
“Most weeks she gave the card to her mom, who put it towards the water or electric bill. Occasionally she used it to go to the movies or the mall with her friends, or to pay for school expenses, including the recent purchase of a black polo shirt with the G. W. Carver school logo embroidered on the breast, a privilege reserved for seniors.
“ ‘It helped my family a lot,’ Grimes said. ‘It really made life easier.’
“Now, hundreds of other New Orleans teens are set to receive similar assistance as part of a groundbreaking study on the impact of providing young people with a ‘universal basic income,’ or recurring cash payments with no strings attached.
“After promising preliminary findings and a $1 million investment from the city of New Orleans, a guaranteed income program that began with 20 students at The Rooted School in 2020 will expand this fall to 1,600 high school seniors at schools across the city over the next three years. Deemed the ‘$50 Study,’ the program gives students $50 per week and follows their academic and financial progress. It’s one of the first of its kind to study the impact of universal basic income on youth.
“Researchers said that high schoolers over the past two years — 386 students from The Rooted School in New Orleans, The Rooted School Indianapolis and G. W. Carver High School — who received payments missed fewer days of school, showed more literacy growth and enjoyed more financial stability than their peers who did not receive money. …
“At the height of the pandemic in 2020, [Jonathan] Johnson, then executive director of Rooted New Orleans, noticed an alarming spike in absenteeism among his students, many of whom had to take on extra shifts at work to help their families make ends meet.
“Hoping to alleviate some of the financial stress on students, they launched a ‘micropilot’ with 20 Rooted seniors, ten of whom received weekly payments. From 2022 to 2024, they expanded to a randomized control trial with 386 students over two cohorts.
“According to preliminary data, which has not yet been peer reviewed, students who were given the funds attended an average of two more school days per semester and their reading test scores grew by nearly double that of the control group. Researchers also found students who received the money demonstrated better ‘financial capability,’ a term used to refer to financial literacy and real-world application, and scored higher on tests measuring their financial well-being.
“Stacia West, who co-founded the Center for Guaranteed Income Research at University of Pennsylvania and acts as lead researcher for the $50 study, said the program can provide young people with valuable lessons, including how to navigate — or avoid — risky financial instruments such as payday loans and credit cards.
“ ‘The fact that these kids are able to interact with these financial markets so early,’ said West, who is also an associate professor at the University of Tennessee, ‘means they’re going to be better equipped when they get into their 20s to make better financial decisions.’
“Students in phase one of the study, which took place from 2022 to 2023, only used about half of cash assistance. About 47% of the money remains in the students’ bank accounts, suggesting many are saving.
“Of the money they did spend, about 50% went towards food and groceries, 30% to goods and services, 12% to transportation, 3% to healthcare and the rest to other expenses.
“Results from the second phase of the study, which followed 28 students from Rooted Indianapolis, 47 students from Rooted New Orleans and 155 students from G. W. Carver — a Collegiate Academy-run high school — will be published in the spring.
“Grimes, who participated in the second phase, said having the money helped her family with unexpected expenses, like food and travel purchases while out-of-town for her great-grandmother’s funeral. This summer, she used it to pay for Ubers back and forth to work as a camp counselor-in-training at Live Oak Camp. …
“Malik Williams, a junior at G. W. Carver, said he spent money on food and school supplies, including a pair of New Balance sneakers and a pair of headphones.
“New Orleans used to have a guaranteed basic income program aimed at young people ages 18-24 that was part of a national initiative called Mayors for Guaranteed Income. An effort to expand the program in December was not funded by the city council.
“Jeff Schwartz, Director of Economic Development at the City of New Orleans, said in a statement that the agency is ‘thrilled to be an investor’ in the $50 study. …
“West said that the Rooted School’s study is the first to track the impact of guaranteed income on young people. … ‘I think this could be a new way to think about educating and socializing our children financially.’ “
Not to mention relieving some of the stress that interferes with learning, I’d say. Financial literacy shouldn’t be the only goal. Staying in school, learning more, having a better shot at a good future as a result … what about that? I hope to track down the newer study once it’s completed.
More at the Times-Picayune (Nola.com), here.
Suzanne's Mom's Blog 