HOMELESS

Homelessness is a significant economic policy issue in the United States, with far-reaching implications for individuals, communities, and the broader economy. The situation in our city reflects a nationwide challenge that policymakers and economists need to grapple with.

Economic Impact of Homelessness

Homelessness imposes substantial costs on society and the economy:

• The federal government spends about $4 billion annually on homeless assistance, which has doubled since 2007*.
• State and local governments also allocate significant resources. For example, California spends $7.2 billion annually on homelessness, while New York City spends $2.2 billion per year*.
• On average, each homeless person costs taxpayers roughly $35,000 to $100,000 per year*.

These figures only account for direct spending. Indirect costs, such as increased healthcare expenses and reduced economic productivity, further amplify the economic impact of homelessness.

Housing Affordability and Economic Policy

The root cause of homelessness is often tied to housing affordability:

• Since 1980, housing affordability has been the key driver of increases in homelessness*.
• In many areas, housing costs have risen faster than incomes, pushing more people into housing insecurity*.
• Before the COVID-19 pandemic, between 8 million and 11 million people were unhoused or on the verge of homelessness*.

Policy Approaches

Addressing homelessness through economic policy is complex and multifaceted:

1. Housing-focused solutions:
• The “Housing First” strategy, which prioritizes providing permanent housing without preconditions*.
• Increasing funding for affordable housing programs and rental assistance*.
2. Broader economic measures:
• Policies to reduce housing costs by removing barriers to new construction*.
• Addressing income inequality and wage stagnation to improve housing affordability*.
3. Social services integration:
• Investing in mental health programs, substance abuse services, and other supportive measures*.
• Implementing stricter conservatorship laws for those unable to care for themselves*.
4. Prevention strategies:
• Focusing on broader social mobility policies to reduce poverty and prevent homelessness*.
• Providing emergency assistance to those at risk of losing their housing*.

While Non-government Agencies play a crucial role in supporting homeless individuals, including young adults, comprehensive economic policies are essential for addressing the root causes of homelessness and providing long-term solutions. The issue remains a significant economic concern that requires coordinated efforts from federal, state, and local governments, as well as private sector involvement.