Increasing the Minimum Wage Can Reduce Suicide Rates: Study
Wed, April 21, 2021

Increasing the Minimum Wage Can Reduce Suicide Rates: Study

WHO reported that suicide is the second leading cause of death among 15- to 29-year-olds globally. / Photo by: Freedom Studio via Shutterstock

 

Suicide is a significant public health concern around the world, with over 800,000 people taking their own lives every year. The World Health Organization reported that it is the second leading cause of death among 15- to 29-year-olds globally. In 2016, 79 percent of suicides occurred in low- and middle-income countries. It also accounted for 1.4 percent of all deaths worldwide during the same year. 

While there have been key interventions that have shown success in reducing suicide rates, the fact still remains that one person dies from suicide every 40 seconds. Dr. Tedros Adhanom Ghebreyesus, WHO Director-General, said, “Every death is a tragedy for family, friends, and colleagues. Yet suicides are preventable. We call on all countries to incorporate proven suicide prevention strategies into national health and education programs in a sustainable way.”

Reducing stigma and talking openly about suicide is a key to preventing suicide. This also means that we need to talk about its causes and risk factors. Most of the time, suicidal thoughts are rooted in a feeling like you can't cope when you're faced with what seems to be an overwhelming situation. This involves everything about your life, from family issues and academics to work or the adulting phase. Previous studies also showed that there is a genetic link to suicide.

Another study also suggested that the issues surrounding the minimum wage have a great influence on people’s lives. For many years, there has been a heated debate, particularly in the US, on whether the minimum wage should increase or not. Milton Friedman, a famed economist, extremely opposes the increase in the minimum wage, stating that "...people whose skills are not sufficient to justify that kind of a wage will be unemployed." 

Meanwhile, the US Department of Labor suggested that raising the minimum wage would help the economy in several ways, including increasing consumer purchasing power and reducing employee turnover.

Reducing Suicides

Gusto, a modern, online people platform that helps small businesses take care of their teams, recently released a report revealing that when employees are paid the federal minimum wage of $7.25/hour, employee turnover rate will be more than twice the national average. The report found a strong correlation between the rate of turnover and hourly wage thresholds. It showed that there’s a 70 percent chance that employees will leave their jobs within a year when they continue to earn just the minimum wage. 

According to CNBC, the world leader in business news and real-time financial market coverage, this is why the Raise the Wage Act was proposed in the US House of Representatives. It aims to gradually increase the federal minimum wage to $15/hour by 2025. Although almost all 2020 Democratic presidential candidates are supporting this, the Senate hasn't considered the legislation at this point.

Earlier this year, a study published by the National Bureau of Economic Research analyzed the trends between suicide and minimum wage. Unlike previous research that generally only suggested a connection between the minimum wage and suicide, this study posited a direct causal link between people's wages and suicide rates. According to Reuters, an international news organization, Dr. Martin McKee, a researcher at the London School of Hygiene and Tropical Medicine, stated that this study is a reminder for many countries that political decisions can make the difference between life and death.

The researchers first gathered and examined data on suicide rates and minimum wages in all 50 US states from 2006 to 2016. They recorded more than 432,000 deaths by suicide during this period and an average of $8 minimum wage per hour. At the same time, they found out that the average minimum wage in 16 states increased from $6.42 in 2006 to $8.28 in 2009 and then decreased to $7.40 in 2016. The remaining states, on the other hand, had higher minimum wages than the federal minimum wage for about seven years.

The findings of the study showed that suicide rates would reduce by less than 3.6 percent or 1,230 suicides per year if the minimum wage is increased by 10 percent. Also, increasing the Earned Income Tax Credit (EITC) by 10 percent appears to have decreased non-drug suicides by about 5.5 percent. According to the Washington Post, a major American daily newspaper, young women will be affected by this increase since they are most likely to have minimum-wage jobs. 

Anna Godoy, one of the paper's authors and a labor economist at the University of California, Berkeley, said, "The discussion about economic policies and the minimum wage is often framed in narrow economic terms and our studies show it's not just jobs and wages that are affected, they are also likely to affect mental health.”

 

The findings of the study showed that suicide rates would reduce by less than 3.6% or 1,230 suicides per year if the minimum wage is increased by 10%. / Photo by: Andrii Yalanskyi via Shutterstock

 

Raising the Minimum Wage Can Benefit Everyone

The study titled "The Distributional Effects of Minimum Wages” published by the US Census Bureau provided compelling evidence that increasing the minimum wage will benefit a large majority of low-income workers in the long-term. As a result, this will decrease inequality, leading to a healthier economy. 

According to Business Insider, a fast-growing business site with deep financial, media, tech, and other industry verticals, the researchers gathered and analyzed non-public data from the Social Security Administration and linked it with data from the Current Population Survey. Economists Kevin Rinz and John Voorheis argued that the increasing degree of income inequality in the US that has been existing for the past 45 years will slow down through a minimum wage increase of 37 percent. 

Indeed, there will be great impacts if only governments prioritize raising the minimum wage. This will help in elevating the lives of many people and also boosting the economy.