New York City Housing Voucher Study on Work Rewards Show Benefits for Certain Households

MRDC, a social policy research institute, evaluated the Opportunity NYC-Work Rewards demonstration project, testing three different approaches aimed at improving employment outcomes of housing voucher holders between April 2008 and October 2010. Two of the approaches involved voucher holder participation in the Family Self-Sufficiency (FSS) program, a HUD-funded program that provides enhanced services to tenant households with the goal of increased economic independence. The study tested outcomes of FSS alone, FSS coupled with work incentives, and work incentives alone. Work incentives consisted of monthly cash reward payments to encourage sustained work, education or training activities. Overall, no evidence suggests that FSS alone improves outcomes across the entire sample of participants, but FSS coupled with incentives may have an impact on subgroup populations. For the study involving FSS alone and FSS with incentives, community organizations recruited 1,603 nonelderly and nondisabled tenants. The group was diverse, with varied work experience and education levels. After 18 months of participation, 29% of total participants in both the FSS-only and FSS with incentives groups had accumulated savings ($1,112 and $1,312, respectively). Throughout the program, more participants earned reward payments for sustaining employment (31%) than for completing an education or training activity (5%). However, participation in the FSS-only and FSS with incentives approach had little effect on overall employment rates or average earnings across the entire sample. In the incentives-only study, a sample of 1,318 nonelderly and nondisabled tenants were assigned to either a group offered monetary incentives, or a control group without incentives. Neither group was offered FSS employment services. Of program participants, 47% earned a reward payment within the first 18 months. More participants earned reward payments for sustaining full-time employment (45%) as opposed to earning rewards for education or training activities (5%). Incentive-only program participants earned an average of $1,452 more than the control group, and were slightly more likely (3.9 percentage points) than the control group to work over the period of the study. Because outcomes vary by subgroup, programs may hold promise for certain households but not others. Those who were unemployed prior to the study saw gains in average total earnings ($1,658 for FSS-only, $3,102 for FSS with incentive, and $1,375 for incentive-only). Earnings increased the most for the FSS with incentives group at 45% above the control group average. Tenants who were employed at the beginning of the study period actually saw decreases in earnings. This could be due to the focus of FSS services on job searches and work-readiness rather than on employment advancement, and because these participants had multiple other priorities, making it difficult for them to concentrate on the FSS program components. Additionally, food stamp recipients experienced average total earnings increase in all three programs ($2,056 for FSS-only, $1,261 for FSS with incentive, and $2,711 for incentive only). In the incentives-only study, earnings increased by 19% of the control group average. This suggests that work-focused incentives may be more effective for food stamp recipients with vouchers. Because food stamp earnings are reduced as income increases, Work Rewards incentives compensate for food stamp reductions as participants increase their incomes.Working Toward Self-Sufficiency: Early Findings from a Program for Housing Voucher Recipients in New York City can be found at http://bit.ly/YsxRTY.