Rapid Health Analysis of Minimum Wage Bill in California

Summary

California’s state minimum wage, currently $8, is scheduled to increase to $9 on July 1, 2014. State Senate Bill 935, introduced by Sen. Mark Leno of San Francisco in February 2014, proposes to increase the state’s minimum wage in three steps, starting at $11 an hour in 2015 and by an additional $1 per hour in both 2016 and 2017. After 2017, the minimum wage would increase with inflation.

This health analysis finds that raising the state’s current minimum wage to $13 by 2017 would significantly benefit health and well-being. As a result of the proposed law, about 7.5 million lower-income Californians could expect an increase in family income. Californians would experience fewer chronic diseases and disabilities; less hunger, smoking and obesity; and lower rates of depression and bipolar illness. In the long run, raising the minimum wage would prevent the premature deaths of hundreds of lower-income Californians each year.

A multitude of studies have established family income as one of the strongest and most far-reaching determinants of health. Our analysis of the California Health Interview Survey (CHIS), the nation’s largest state health survey, found that people whose family incomes are below the federal poverty line are more than four times as likely to rate their health as poor or fair compared to people with family incomes of more than three times the federal poverty level.

Income affects health not only through one’s ability to meet material needs, but through access to health care, the quality of neighborhoods in which people can afford to live, child health and development, chronic stress, and interpersonal relationships.

• Nationally, one-third of food insecure families had to skip meals or cut portions at some point during the year.
• Lower-income neighborhoods tend to have fewer resources for healthy living, including nutritious and affordable food options, safe and comfortable parks and trails, and public services.
• Children in lower-income families are exposed to multiple, cumulative physical and psychosocial risk factors including family turmoil, community violence, early childhood separation, substandard housing, noise, and crowding.
• The longer one lives with low income, the more negative health impacts accumulate.

Federal and state minimum wage laws were established to ensure that working Americans had enough income to live healthy lives. But in recent decades, not only have most Americans had no significant gain in real income, workers earning the minimum wage have actually seen their purchasing power decline.

In 1968, California’s minimum wage was $1.65 an hour. Adjusted for inflation, to buy the same amount of goods and services today’s Californians would need $10.77 – roughly equal to the $11 an hour minimum wage that SB 935 would mandate starting in 2015.

This analysis found:

• The proposed minimum wage of $13 would substantially increase income for families in the lowest quarter of the income distribution.
• Californians in families whose income increased as a result of the higher minimum wage would be more likely to be born healthier, develop stronger bodies and brains, and suffer from fewer chronic diseases as adults and into old age.
• Fewer Californians would live in poverty, ensuring that they would get enough to eat. Fewer would be forced to live in the unhealthy environments of substandard housing and poor neighborhoods. More Californians would have adequate health care and access to health insurance.
• More of California’s children would be better prepared for school and achieve more in school, which in itself leads to healthier adult lives. Children would miss fewer school days. Our analysis of CHIS data found that children under 5 whose family incomes are more than three times the federal poverty level are 2.6 times more likely to have been read to by a caregiver than children whose family incomes are below the poverty level. Teens whose family incomes are below the poverty level are almost twice as likely to miss three or more days of school in a month when compared to teens in families with incomes of more than three times the poverty level.
• Fewer people would smoke. Our analysis shows that adults in families in poverty are 50% more likely to smoke than those in families earning more than three times the poverty level.
• More would exercise regularly. Our analysis indicates that adults in families below the poverty level are half as likely to get recommended weekly amounts of physical activity as those in families whose incomes are three times the poverty level. Children in California’s lower income families also get less exercise. Teens in families below the poverty level are 2.5 times as likely to be overweight or obese as teens in families whose incomes are three times the poverty level.
• Fewer Californians would suffer from emotional and psychological problems, such as depression and poor self-esteem. Our analysis shows that adults in families who live in poverty are over twice as likely to face serious psychological distress and to suffer from family life impairment as those in higher income families.
• Most dramatically, premature deaths of 389 lower-income Californians would be prevented each year. Nationally, people who live above the federal poverty line can expect to live more than five years longer than those below the line.

While low income limits health, amplifying the negative impact is the fact that poor health can also lead to lower income. People with physical or mental disabilities are much less likely to be employed than people without disabilities, and may earn less income even when employed.

In conclusion, this health analysis finds that SB 935 would result in significantly improved health and well-being for Californians.