Saturday. 23.02.2019
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Recipients of basic income perceived their well-being improved

They felt less stressed and were also more confident in their possibilities of finding employment, as explained in the preliminary results published today by the Finnish Government

Image by Minna Hamalainen
Image by Minna Hamalainen
Recipients of basic income perceived their well-being improved

The Finnish government published today the preliminary results of the basic income experiment. This experiment was carried out on a population of 2,000 non-voluntary people randomly selected. 

For a period of two years, the participants received a monthly basic income of 560 euros. They got this sum automatically every month, regardless of whether they had some other income or not, without any needs assessment, and with no conditions attached. Furthermore, they were not required to pay taxes on basic income.

During the evaluation of the basic income experiment, some experts studied the effects of the basic income on the employment status, income and well-being of the participants.

According to the preliminary results published by the Ministry of Social Affairs and Health, this unique experiment "did not increase the employment level of the participants in the first year".

The recipients of a basic income had on average 0.5 days more in employment than the control group. The average number of days in employment during the year was 49.64 days for the recipients of a basic income and 49.25 for the control group.

"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’, declared Ohto Kanninen, Research Coordinator at the Labour Institute for Economic Research.

Improvements in well-being

"However, at the end of the experiment the recipients of a basic income perceived their well-being as being better", acknowledges the Ministry of Social Affairs and Health on its release.

The figures provided show that 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 at Kela.

Increase of confidence

The recipients of a basic income were also more confident in their possibilities of finding employment. In addition, they felt that there is less bureaucracy involved when claiming social security benefits and they were more often than the control group of the opinion that a basic income makes it easier to accept a job offer or set up a business.

"The basic income may have a positive effect on the well-being of the recipient even though it does not in the short term improve the person’s employment prospects", says Ylikännö.

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

The recipients of a basic income were selected through random sampling among those who in November 2016 received an unemployment benefit from Kela. The control group consisted of those who in November 2016 received an unemployment benefit from Kela but were not selected for the experiment.

An exceptional experiment

The basic income experiment was an exceptional social experiment both domestically and internationally in that it was set up as a nation-wide, randomised field experiment.

"A typical employment relationships are becoming increasingly common, and our social security system does not fully cater to the needs of modern working life. The basic income experiment allowed us to explore more flexible ways of accepting employment, and to find out how financial incentives affect the acceptance of job offers" said Minister of Social Affairs and Health Pirkko Mattila in her speech at a seminar on the preliminary results of the basic income experiment held on 8 February.

Participation in the experiment was not voluntary, which means that it is possible to draw more reliable conclusions of the effects of the experiment than was the case in previous experiments which were based on voluntary participation.

The experiment was begun on 1 January 2017 and ended on 31 December 2018.

"A solid base for new ambitious social experiments"

"The lessons learned while planning and implementing the experiment provide a solid base for the planning of new ambitious social experiments -for instance of a negative income tax", said Olli Kangas, scientific director of the research project and Professor of Practice at the University of Turku.

The aim of the experiment was to study how it would be possible to reshape the Finnish social security system so that it better corresponds to changes in working life. The experiment was implemented by Kela, the Social Insurance Institution of Finland.

The Finnish Government stresses that the results are preliminary and therefore "it is not yet possible to draw any firm conclusions" regarding the effects of applying a basic income. 

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