There may be some drawbacks, but increasing Ohio’s minimum wage to $15 an hour would save 4,000 lives and create a $25 billion benefit to the state economy by 2036, according to a study released last month by Scioto Analysis.
A group proposing to increase the minimum wage from the current $10.45 an hour to $12.45 and then to $15 did not submit petitions last week for the November ballot, and is now looking to bring the proposal to voters in 2025. The cost-benefit analysis by Scioto found that such an increase would reduce suicides, homicides, infant mortality and low-birthweight babies — phenomena that are associated with economic stress.
The analysis identified two downsides to the proposed increase in Ohio.
It would cost an estimated 73,000 jobs from employers who are likely to calculate that they can’t afford to pay the extra money. It also found that 89,000 fewer Ohioans would get associates and bachelors degrees, if national estimates are correct that increases in the minimum wage correlate to a 4% decrease in college enrollment.
However, the analysis said those costs are far outweighed by the benefits of increasing the minimum wage.
“We find increasing Ohio’s minimum wage to $15 per hour will result in a net benefit to society between $5 and $45 billion over the next ten years, with an average expected net benefit of $25 billion” it said. “The benefit will be driven by saved lives, with the minimum wage leading to an estimated total of 4,000 suicides, firearm homicides, and infant deaths avoided from 2027 to 2036.”
The reasoning behind some the analysis’ estimated benefits:
• Suicides — They relied on a 2020 study that said every $1 increase in the minimum wage corresponded to a 3.4% to 5.9% decrease in the suicide rate among adults with a high school education or less. Coupling that with the $9 million in value to the economy that the Federal Emergency Management Agency assigns to a single life, they found that suicides prevented would be worth $14 billion over 10 years in Ohio.
• Gun violence — Economic insecurity is associated with homicide, and a Johns Hopkins University study this year found that every 1% increase in the state minimum wage relative to the state median income corresponded to a 1.3% decrease in firearm homicide rates. Given that roughly 820 Ohioans are killed by homicide each year, the state’s proposed minimum wage increase can be expected to save roughly 1,500 lives over the coming decade, creating a $13 billion benefit over 10 years under Ohio’s proposed increase.
• Infant mortality — A study published last year in the Journal of the American Medical Association found that every $1 increase in the minimum wage is associated with a 4% decrease in infant mortality. With nearly 600 Ohio children between 28 and 364 days old dying in 2021, just over 1,000 infant lives would be saved over the next decade, creating a $9.1 billion benefit, the analysis said.
