The Effect of Work Requirements on Mental Health of Subsidized Housing Recipients: Evidence from the Housing Authority of Champaign County, Illinois

Abstract

This study examines the early effect of work requirements on mental health of subsidized housing recipients. The Housing Authority of Champaign County (HACC) enforced work requirements for working-aged and non-disabled recipients and supported their transition to work with case management services. In addition, non-compliance with work requirements might result in the loss of housing subsidy. We collected survey data 1 year prior to and 1 year following the implementation of HACC’s work requirements to compare changes in mental health measures between work-able recipients who were and were not subject to work requirements. We calculate the average treatment effects on the treated estimates obtained from difference-in-differences with propensity score matching to control potential bias stemming from unobserved time-invariant variables and support the model’s parallel trend assumption. Our main results show that, during the early phase of work requirements, impacted heads of households were predicted to increase depression scores and decrease hopefulness scores relative to changes in mental health measures of the matched control groups over the same period. Recipients’ mental health would play a critical role in the success of HACC’s self-sufficiency strategies, and therefore the housing authority may strengthen the transition of hard-to-employ recipients into the workforce by offering careful assessment and screening to identify recipients with serious mental health problems or other employment barriers and reinforcing their access to supportive health and social services.