Increasing minimum wage linked to lower suicide rates

Warning: This article deals with suicide.

Increasing the minimum wage could help prevent suicides, new research has found.

Researchers in the US looked at 26 years of data, and found for every US$1 the minimum wage rose, suicide rates would fall 3.5 to 6 percent amongst people without tertiary education. 

"Our findings are consistent with the notion that policies designed to improve the livelihoods of individuals with less education, who are more likely to work at lower wages and at higher risk for adverse mental health outcomes, can reduce the suicide risk in this group," the Emory University researchers said. 

Unexpectedly, the preventative effect of raising the minimum wage appears to be stronger when unemployment is high - at least 6.5 percent. 

"When unemployment is high an unemployed individual is less likely to feel a failure or isolated, compared with during times of low unemployment," the researchers proposed, also suggesting increased spending on social welfare when times are tough could ease the burden. 

When unemployment is low, minimum wage rises have little effect on suicide rates, the researchers proposing employers are willing to pay more when there's a shortage of labour, so fewer people's incomes are affected. 

There was no apparent effect on those with a university education or higher, with few in that group earning minimum wage. 

In the wake of the global financial crisis in 2009, the researchers estimate tens of thousands of lives could have been saved if instead of austerity measures, state governments raised minimum wages. 

"We estimated that 13,800 suicides could have been prevented between 2009 and 2015 among those aged 18-64 years," they wrote in the study, published in the Journal of Epidemiology & Community Health. Double that could have been saved by a US$2 increase.

"Over the entire study period from 1990 to 2015, we estimated that a US$1 increase in state minimum wage above prevailing levels could have prevented 27,550 suicide deaths in this group, and a US$2 increase could have prevented 57,350 suicides."

The US federal minimum wage has been US$7.25 since 2009, when the global financial crisis hit. That's about NZ$11. Several states - but not all - have minimum rates higher than this. New Zealand's minimum wage is $17.70, and set to rise to $18.90 in 2020.

The US suicide rate is at its highest since World War II, at 14 out of every 100,000 in 2017 - up 33 percent in two decades. New Zealand's is similar, at 13.7 per 100,000 in the year to June last year. 

David Seymour.
David Seymour. Photo credit: Getty

ACT leader David Seymour, who has argued against the large minimum wage hikes enacted by the present Government, said the research is "either wrong or irrelevant to New Zealand" as we have both high minimum wage and suicide rates.

"It is sad that people will so easily use the tragedy of suicide in New Zealand to bolster their particular cause," he said, anticipating people would do so.

The study measured changes to both federal and state minimums over the 26-year period.

They note while the study is observation and a direct cause-and-effect can't be established on this data alone, their findings agree "with prior research on the moderating effect of the generosity of economic security policies on the positive relationship between unemployment rates and suicide rates". 

Where to find help and support: 

 

Contact Newshub with your story tips:
news@newshub.co.nz