How Raising the Minimum Wage Can Be a Win for Mental Health

  • Members of Congress are considering a proposal to raise the federal minimum wage to $15 per hour by 2025.
  • Research shows that increasing the minimum wage by just $1 could lead to fewer people ending their own lives.
  • There’s also evidence that increasing household incomes could reduce people’s risk of mental illness and improve children’s mental health.

More than 200 members of Congress have cosponsored a bill that would gradually raise the federal minimum wage to $15 per hour by 2025.

If passed, the bill would potentially lift 900,000 people out of poverty and increase wages for at least 17 million workers, according to a Congressional Budget Office (CBO) study released earlier this month.

But what that report doesn’t mention is another potential benefit of boosting the minimum wage: Saving lives.

Research published in 2020 from the Journal of Epidemiology and Community Health found that increasing the minimum wage by as little as $1 could cause the suicide rate to drop.

It’s just one of many mental health benefits that could come from a mandate for companies to provide a more livable wage to some of the lowest-paid workers in the country.

Suicide rates drop

Money problems are a significant risk factor for suicide. In fact, financial stressors like debt, unemployment, low income, and past homelessness, may make someone 20 times more likely to attempt suicide, according to a 2020 study published in the American Journal of Epidemiology.

“When you’re immersed in financial problems, it’s difficult to see any way out of it,” said Elizabeth Dunn, PhD, psychology professor at the University of British Columbia, chief science officer of Happy Money and co-author of “Happy Money: The Science of Happier Spending.” “And that’s really important when it comes to suicidal ideation. If you can’t see any way out of a situation, that’s where that really dark choice starts to seem plausible.”

Raising the minimum wage could help ease some of the financial strain many people face in the United States, and ultimately reduce their risk of suicide.

Just how many lives would be saved after the minimum wage more than doubles from the current $7.25 remains unknown, but we might be able to get a sense of the benefits from a 2020 study published in the Journal of Epidemiology & Community Health.

The study found that a $1 increase in the minimum wage could bring down the suicide rate of working-age adults with no more than a high school education by 3.4 to 5.9 percent, with the biggest gains coming during times of high unemployment.

Mental health improves

Raising the minimum wage could also lead to less stress and substantial improvements in mental health, which would not only have the potential to further reduce suicide rates, but also be a benefit in their own right.

“When you don’t know where your next meal is coming from and you have to worry about paying the bill, that certainly increases stress and stress is associated with mental illness,” said Cynthia Fontanella, PhD, associate professor of clinical psychiatry at The Ohio State University.

A 2018 literature review found an association between minimum wage increases and better mental and overall health in 3 of 4 high quality studies.

What’s more, a 2011 study from JAMA Psychiatry found that people in the United States with an annual household income below $20,000 were more likely to have mental health conditions, such as depression or anxiety, compared with those making $70,000 or more.

While more research is needed to determine whether increasing income could reduce mental health conditions over the long term, the report noted that it was a possible outcome.

“People in the lowest income groups in the U.S. really struggle with putting food on the table, having appropriate health insurance, and living in difficult neighborhoods. I think having the support of a higher minimum wage will be protective,” Dr. Jitender Sareen, professor and head of the psychiatry department at the University of Manitoba, who co-authored the study, told Healthline.

“Our study documented very clearly that living in those difficult environments really increases stress on a person and increases their likelihood of mental health difficulties,” he added.

Improvements in mental health due to less financial stress may also have a positive effect on everyone within that household, and provide lifelong benefits to children.

Strengthening household financial security is listed by the Centers for Disease Control and Prevention (CDC) as one of the top strategies to preventing traumatic childhood experiences, which can lead to struggles with money, employment, and depression throughout kids’ lives.

“The add-on effects of increasing the minimum wage for families could be substantial,” Dunn said. “I would predict that it would lead to a significant reduction in anxiety disorders among children and adolescents living in poverty. Not everything would be perfect, but there’s such a potential for ripple effects for the whole family.”

Making the case for mental health

While research has shown the potential for higher incomes to reduce suicide rates and improve mental health outcomes, the reality may be a bit more complicated.

The February report from the CBO also noted that raising the minimum wage to $15 per hour could result in job losses for 1.4 million workers, who may face financial stress as a result.

And if the wages of low-income workers fail to keep up with the rising costs of living, we could see inflation chip away at any would-be gains in mental health.

What is clear, though, is that the growing body of research on the link between income and mental health deserves more discussion among policymakers in the debate on a $15 federal minimum wage, especially as the pandemic continues to tax people’s well-being.

“Policymakers may not be aware of these important issues, but it’s been shown repeatedly by scientists that people with poor socioeconomic status have a higher rate of mental health difficulties,” Sareen said. “I’m not clear why it’s not a major discussion in the U.S.”

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