Study Finds U.S. Universal Basic Income Recipients Prioritize Essentials and Retain Jobs

A large-scale UBI study found recipients used the money for essentials, worked slightly less, and were more likely to pursue education or job training.

A large-scale study by OpenResearch, supported by OpenAI’s CEO Sam Altman, examined the impact of providing low-income individuals with $1,000 per month over three years and found that recipients kept their jobs while tending to essential needs.

The idea commonly known as Universal Basic Income (UBI), is a concept proposed to combat soaring cost of living, high inflation, and increased AI automation in the workforce.

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The UBI study was the largest of its kind in the U.S. and was conducted across Illinois and Texas, investigating how consistent cash transfers affected recipients’ lives. The results were compelling: individuals primarily spent the monthly stipends on essential needs and helping others. There was an average monthly increase in spending of $310 per month, with the largest increases in spending on food ($67), transportation ($50), and rent ($52).

When it comes to work, Bloomberg reports that recipients retained their jobs but worked slightly fewer hours per week — showing that the extra income provided significant financial stability without encouraging people to withdraw completely from the labor market.

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Researchers also discovered the most significant advantage of these cash transfers was the improvements to flexibility and autonomy it provided to the recipients. Many found that the additional income allowed them to make more strategic decisions regarding their personal and professional lives, likely improving work-life balance.

Similar smaller-scale studies have been conducted, but the OpenResearch initiative stands out due to its scale and continuity. The data suggests that the introduction of a UBI could be a tool used in assisting displaced/low-income workers, with many beneficiaries reporting improved economic conditions and reduced financial stress. Notably, recipients were 14% more likely to report having pursued education or job training during the final year of the program.

While the findings from OpenResearch are some of the first of its kind, they do align with earlier, smaller-scale studies reinforcing the argument that a UBI does not completely deter workers from employment. Instead, it supports beneficiaries in achieving a better quality of life and empowers them to participate in the economy more meaningfully. However, more research is likely needed in these areas to improve and develop programs for the workforce.