A Cost-Effectiveness Assessment of Employment Services in Supportive Housing

According to a 2007 report by the federal Department of Housing and Urban Development, the Annual Homeless Assessment Report to Congress, the number of people in this country who were living in shelters or were unsheltered in January 2005 totaled 754,147. Of those, 338,781 were living on the streets, in cars or in other areas not meant for human habitation.

Supportive housing—i.e., housing coupled with social services such as job training, alcohol and drug abuse programs and case management—is a cost-effective and proven strategy to break the cycle of chronic homelessness.

According to financial analysis by the Lewin Group, published in a chart book, Costs of Serving Homeless Individuals in Nine Cities, a day in supportive housing costs significantly less than a day in a shelter, jail or a psychiatric hospital. For example, in New York City, a day of supportive housing costs $31.23, compared to a day in jail ($164.57), a psychiatric hospital ($467) or community hospital ($1,185).

Studies conducted on supportive housing have also shown that when formerly homeless individuals use supportive housing, they experience:

In addition, more than 80 percent of individuals who use supportive housing stay housed for at least one year (Dennis Culhane, et al.).

The Corporation for Supportive Housing

In 1991 three philanthropies—the Pew Charitable Trusts, RWJF and the Ford Foundation—established the New York-based Corporation for Supportive Housing, the nonprofit organization that received this grant. Its purpose is to support the individual efforts of local nonprofits developing service-supported housing for those most in need: people coping with homelessness and extreme poverty, as well as chronic health conditions such as mental illness, addiction or HIV/AIDS.

Funders Together to End Homelessness

In 2004, seven national foundations (including RWJF), nonprofit organizations and financial institutions came together to create the Partnership to End Long Term Homelessness (later renamed Funders Together to End Homelessness, or Funders Together) to galvanize leadership and dollars to bring an end to long-term homelessness over the next decade. Founding organizations included:

At that time, Funders Together committed more than $37 million in grants and loans to the Corporation for Supportive Housing, the National Alliance to End Homelessness and other groups working to end long-term homelessness through the development of supportive housing. It also aimed to leverage at least $30 million more from other national and locally-based foundations, financial institutions and businesses, and to work to achieve significant increases in public and private sector financing for the capital, operating and service costs of supportive housing.