Raising Minimum Wage Would Improve Health, Reduce Costs

A bill (SB 935) being considered by the Assembly that would raise California's minimum wage could prevent hundreds of early deaths and reduce health care costs in the state, according to an analysis by Human Impact Partners, KQED's "State of Health" reports (Dornhelm, "State of Health," KQED, 6/3).

Background on Bill

The state's minimum wage is set to increase from the current rate of $8 per hour to $9 per hour beginning on July 1.

Under the bill, the minimum wage would go up to $11 per hour in 2015 and then increase by an additional $1 per hour in 2016 and 2017 -- reaching $13 per hour. The minimum wage rate would later be adjusted to increase with inflation.

Details of Analysis

HIP's "rapid health analysis" was based on information from the California Health Interview Survey.

Researchers found that residents with household incomes below the federal poverty level were four times more likely to describe their health as fair or poor, compared with residents whose household incomes were more than three times the poverty level. In addition, residents living in lower-income areas often have less access to health care.

Researchers said the findings suggest that increasing the state's minimum wage to $13 per hour "would significantly benefit health and well-being" by boosting the household income of about 7.5 million low-income residents.

The analysis found that the changes would result in nearly 400 fewer premature deaths in California annually because of:

• Fewer chronic diseases and disabilities;
• Less hunger;
• Lower smoking rates;
• Lower obesity rates; and
• Lower rates of depression and bipolar disorder (HIP analysis, May 2014).

HIP Co-Director Jonathan Heller said, "Giving working families a decent standard of living ... is one of the most powerful interventions we can make for public health" ("State of Health," KQED, 6/4).