The minimum wage sparks intense conversations whenever it comes up. One side demands that workers be able to support themselves, per the minimum wage's original conceit; others insist that small businesses can't support government-mandated increases in pay when margins might be so thin. Everyone's looking for research to support their own side of things, but one new study takes a new look at the cost-benefit analysis.
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Public-health researchers at the University of California, Davis, used data collected over 16 years from 19,000 low-wage workers to see what happens when base wages change. The results are pretty profound: When hourly wages increased by just $1, these workers were able to stay healthier and miss less work due to illness. That created a 32 percent decrease in absences, which can mean huge savings for business owners.
For those concerned about profitability, the researchers also found no significant correlation between an increase in wages and a decrease in work hours or the ability to support a position. In other words, raising the minimum wage noticeably helps workers at little cost to business owners. Twenty-nine percent of minimum-wage workers are single parents, and one-third are women over the age of 25. One dollar an hour could make a big difference to those employees.
If you're in a position to adjust the wages in a small business, take a look at the true costs of minimum-wage work. If you're looking for a raise, bring your boss some peer-reviewed data. A company with fewer absences and healthier employees has a lot to brag about, no matter what.