DENVER CITY REDUCES HOMELESSNESS AND UNEMPLOYMENT WITH PROVIDING $1000 TO PEOPLE EACH MONTH

Homelessness has become a major problem in many countries as cities. With no one-size-fits-all solution, research shows that a little help can put vulnerable people on the right path. A project conducted by the Denver Basic Income Project found that direct cash assistance reduced homelessness, improved mental health, and increased employment among homeless people in the city.

The study provided unconditional monthly payments to 800 homeless residents in Denver. They divided him into three groups, one in which he received $1,000 a month for a year. Another person receives $6,500 upfront and  $500 per month thereafter. And the last person only gets  $50 a month. Once the experiment reached six months, many reported feeling safer and having access to more stable housing. "Many participants reported using the money to pay off debt, repair their cars, find housing, and enrol in classes," said Mark Donovan, founder and executive director of the Denver Basic Income Project told Insider. “These are all avenues that may ultimately lift participants out of poverty and reduce their dependence on social assistance programs.” 

Donovan, an entrepreneur, first founded the Denver Basic Income Project in 2021. After making money from Wooden Ships, a clothing company specialising in women's sweaters, and investing in Tesla, he decided to donate some of the money to good causes. He began distributing money to others last year after receiving a $2 million donation from the city of Denver. Of course, the results will vary depending on the amount received. I

n a month, he found that those who received $50 didn't see much improvement and even reported feeling a little more stressed, but in a month he saw dramatic changes in those who received $500  or more. Ta. According to the interim report, 8% of participants initially reported sleeping outside, but this number had fallen to 2% at six-month follow-up. Meanwhile, 23% reported sleeping in accommodation before the experiment, but this decreased to 10% six months later. Other cities, including San Francisco and Vancouver, have launched similar projects. Both regions are known for their high cost of living, pushing people working in minimum wage jobs to the brink.

By comparison, the Denver experiment yielded similar results to the previous case. "Housing has improved, homelessness has decreased, and spending and savings have increased over time, resulting in net savings for the government and taxpayers," said Jiaying Zhao, an associate professor of psychology at the University of British Columbia who oversaw the Vancouver project. Ultimately, many systemic changes will be needed to completely eliminate homelessness. However, they are confident that existing tools can be used to specifically support vulnerable people and that their situation will improve in the long term.