How An Increase in Minimum Wage Can Improve Health

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(Getty Images)
(Getty Images)

A bill by state Sen. Mark Leno aimed at raising the minimum wage passed the California Senate and is moving on to the Assembly.

But what does this have to do with health?

Generally, advocates of raising the minimum wage try to sway public opinion by using economic arguments. But there’s an increasing move to tie health outcomes and health costs directly to the minimum wage, just as health advocates have long tied socioeconomic status generally to health status.

A new study finds that raising the state minimum wage could prevent hundreds of premature deaths in California each year and save millions in health costs.

Human Impact Partners, or HIP, conducted a "rapid health analysis" of Leno's proposed SB935, which would raise the current $8-an-hour minimum wage to $13 an hour by 2017.


They found that the higher wage would prevent the premature deaths of nearly 400 lower-income Californians per year.

“Giving working families a decent standard of living … is one of the most powerful interventions we can make for public health,” says HIP co-director Jonathan Heller.

Raising the Minimum Wage Can Also Raise Health Status ...

Higher pay reduces people's risk of all kinds of health problems, ranging from obesity to depression to smoking.

The report also found that adults and families who live in poverty are more than twice as likely to face serious psychological distress than those families who make three times the poverty level.

Heller says studies have tied the physical problems to the accumulated effects of chronic stress, less access to health care and the quality of neighborhoods in which people can afford to live.

While HIP's study looked specifically at the impact of a minimum wage increase in California, other researchers have looked more broadly. Paul Leigh is a professor of economics at UC Davis Medical School. He and research partner DaeHwan Kim crunched numbers from a multistate health study that lasted from 1999-2007. In some of the states, the minimum wage went up during that time.

In one case, they looked at the effect of the wage increase on rates of high blood pressure. “We found a higher minimum wage was associated with fewer cases of hypertension, especially at lower income levels," Leigh said.

The researchers used the same data set to look at weight. “We found low-wage workers had higher rates of obesity, and when wages went up there was a reduction in prevalence of obesity,” Leigh said.

… Could Lead to Health Cost Savings

Leigh says he would like to do research linking health care cost savings with raising the minimum wage.

According to the Harvard School of Public Health, the United States spent $190 billion a year on obesity-related costs in 2005. The Centers for Disease Control and Prevention says smoking drains more than $289 billion a year from the economy in both medical care costs and lost productivity.

“Obesity, hypertension, smoking are very costly for U.S. economy, so anything you can do to reduce them will have positive effect in reducing overall medical costs,” said Leigh.

That would give advocates of raising the minimum wage a new tool for making their argument.

Rajiv Bhatia authored the study by Health Impact Partners, which looked at how SB935 could impact the health of California’s low-income workers.

He says it’s important to understand the nuanced way that wages affect health.

“It’s not like, ‘OK, I get more money in my pocket and my blood pressure changes and health improves,'” says Bhatia. “Income is working through many pathways. And not every pathway is working on every individual.”

Still, he says, people at the bottom 20 percent of income are four times as likely to rate their health as poor as those at the top. “Low income is associated with exposures that cause diseases,” says Bhatia. “But it also causes your disease outcomes to be worse.”

He says there is a precedent for public health departments getting involved in a policy fight to raise the minimum wage. In Minnesota the commissioner of health publicly advocated for an increase, after a study there showed the health benefits of raising the state's minimum wage.

Bhatia says that, long term, he would like to create something like an online calculator, “so somebody in any state could look at their state wage and plug in an alternative minimum wage. Then they would get as an output how would self-rated health improve, how would health insurance options change, how would education outcomes change.”

Bhatia says that is in the works. In the meantime, he is hopeful that more people arguing for the minimum wage will take up the health mantle.

He says the current paradigm by many advocating for a minimum wage increase is that this is an economic trade-off issue, between what is right and fair versus something that is economically feasible.

But, he says, by putting it in a health frame, it humanizes and adds another dimension. Factoring in health improvements — and estimated health costs savings — is a dimension Bhatia hopes will resonate with the public.