Basic income experiment fails to raise employment

The basic income experiment did not increase the employment level of the participants in the first year of the experiment.

However, at the end of the experiment the recipients of a basic income perceived their wellbeing as being better than did those in the control group, said a press release issued by the Ministry of Social Affairs and Health and Kela on Friday.

‘On the basis of an analysis of register data on an annual level, we can say that during the first year of the experiment the recipients of a basic income were no better or worse than the control group at finding employment in the open labour market’, said Ohto Kanninen, Research Coordinator at the Labour Institute for Economic Research.

The effects of the basic income experiment on wellbeing was studied through a survey which was done by phone just before the experiment ended.

According to the survey, the recipients of a basic income perceived their wellbeing as being better than did the control group.

A total of 55% of the recipients of a basic income and 46% of the control group perceived their state of health as good or very good, 17% of the recipients of a basic income and 25% of the control group experienced quite a high degree or a very high degree of stress.

‘The recipients of a basic income had less stress symptoms as well as less difficulties to concentrate and less health problems than the control group. They were also more confident in their future and in their ability to influence societal issues’, said Minna Ylikännö, Lead Researcher of Kela.

The response rate for the survey was 23% (31% for the recipients of a basic income and 20% for the control group).

In the basic income experiment, 2,000 randomly selected unemployed persons were paid a monthly tax-exempt basic income of 560 euros regardless of any other income they may have had or whether they were actively looking for work. The experiment was begun on January 1, 2017 and ended on December 31, 2018.

Meanwhile, Heikki Hiilamo, Professor of Social Policy at the University of Helsinki said that effects on the labour market were minimal, and survey results demonstrating that basic income recipients had better subjective well-being can be questioned.

“The basic income experiment in Finland has gained unprecedented attention around the world. However, the preliminary results of the experiment are disappointing. The labour market effects, which were the focus of the experiment, seemed negligible. Survey results demonstrated that basic income recipients had better subjective well-being. However, these results can be called into question,” said a press release issued the University of Helsinki quoting Hiilamo as saying .