AgdaPkt 2017-09-25 Closed and Joint SA PFA

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The Effects of a $15 Minimum Wage by 2019 in Santa Clara County and San Jose 28 3.5 Downstream effects The increases in earnings shown in Tables 4 and 5 would be substantial and would have an immediate impact on the lives of low-wage workers and their families in San Jose and Santa Clara County. But it is important to recognize that there are longer-term effects of minimum wage increases as well. Low wages have been shown to affect workers negatively in a variety of ways, but the health impacts are most pronounced. All else being equal, low wages (and in turn poverty) result in increased rates of high blood pressure and high levels of stress, as well as shorter life expectancy (Leigh and Du 2012). A recent study from the United Kingdom found that by reducing the financial strain on low-wage workers, an increase in the minimum wage improves mental health at a level comparable to the effect of antidepressants on depression (Reeves et al. 2016). In another study, additional income led to fewer arrests for parents and increases in parental supervision of their children (Akee et al. 2010). Similarly, increases in Earned Income Tax Credit (EITC) program payments led to improvements in the mental health of mothers (Evans and Garthwaite 2010; Congressional Budget Office 2012). Multiple rigorous studies also establish a causal negative effect of low incomes on outcomes for children. A recent review of peer-reviewed articles found that 29 of 34 studies established a negative effect of poverty on children’s outcomes (K. Cooper and Stewart 2013). Using data from a randomized control trial of the Minnesota Family Investment Program, researchers found positive, significant effects on children’s social behavior and school engagement due to increases in income (Morris and Gennetian 2003). Other researchers analyzed data from ten such studies and found significant effects of increased income on school achievement (Rodgers 2004). Generally, these studies show that additional income has a positive effect on the outcomes of children in households of all income levels. However, multiple studies also suggest that additional income has a larger effect in very-low-income households compared to middle-income households (Dahl and Lochner 2012); (Akee et al. 2010); (Costello et al. 2003). Some evidence indicates that additional income early in life is important to cognitive outcomes, whereas additional income in later childhood may be more important in terms of behavioral outcomes (K. Cooper and Stewart 2013). 8.A. - Page 42