CM: How a Livable Income Impacts Mental Wellness

By Brett Lambert 

The ability to make ends meet—which includes keeping a roof over one’s head, putting food on the table, and meeting other basic necessities—is integral for both a person’s physical and mental well-being. Whether a person’s primary source of income is from employment, or they are reliant on income support programs, everyone deserves a livable income that allows them to meet their needs, especially at a time when inflation is at an all-time high. 

Research has shown that living in low-income is a risk factor for psychological distress. A Statistics Canada longitudinal study showed that lower incomes are significantly related to future episodes of psychological distress and that the everyday social environments of low-income Canadians were implicated in these health disparities. In addition, living in low-income means having fewer resources to cope with and mitigate these stressors. The presence of these stressors and the absence of supports have been linked to physical and mental disorders. (1) 

If living in low-income has detrimental effects on a person’s mental health, will raising their income contribute to an improvement in mental health? The research seems to point to a resounding yes. 

Increases to the minimum wage – which is the lowest hourly rate of pay allowed by law – has been linked with lowering suicide rates. In a study published in the Journal of Epidemiology & Community Health, the research showed that for every dollar added to the minimum wage, suicide rates among people with a high school education or less dropped by 3.4 to 5.9%. Among adults with levels of education above high school, there was no reduction in suicide rates because they would be less likely to work in lower-wage jobs. (2) 

Within Alberta, there have been dramatic changes to the minimum wage within the last decade. Between 2015 to 2018, the minimum wage was raised incrementally each year from $10.20 per hour to eventually $15 per hour. (3) Workers who received a raise overall reported feeling more at ease with the greater financial stability. (4) With a change in government in 2019, the provincial government rolled back the minimum wage to $13 per hour for youth under the age of 18. This change to the minimum wage was particularly jeopardizing to the morale of marginalized youth striving to attain financial independence who may also be experiencing homelessness, substance abuse, and mental health issues. (5) 

Improvements to mental health have also been linked to universal basic income—a government program that gives its citizens a set amount of money regularly to cover their living expenses with no strings attached. While basic income programs have largely been implemented regionally as pilot programs through the years, the results of these studies have shown that improvements to a population’s mental health are among the impacts of such a program. This included improved time with family and friends, a reduction in perceived stigma, and a renewed sense of hope for the future. (6) For the Ontario basic income pilot from 2018 specifically, 83% of respondents who took part in the pilot program reported feeling less stressed and anxious and 81% reported feeling more self-confident. (7) 

Current income support programs in place within Alberta pay recipients below the poverty line, which is roughly defined as an annual income of $40,777 for a family of four or $20,289 for a single individual in Alberta. (8) For example, Assured Income for the Severely Handicapped (AISH)—which pay a maximum monthly benefit rate of $1,685 per month—does not keep pace with the cost of living. While the program is finally being re-indexed for inflation as of January 1, 2023 as a response to the price of essential goods becoming more expensive, AISH recipients are still having to catch up after more than three years of stagnant benefit rates. (9) When elected officials merely discuss making changes to the program—often to the detriment of current or future recipients—this has impacts on a recipient’s mental health. When the provincial government was considering re-evaluating eligibility for those with mental illness, recipients reported feeling their anxiety levels going up over the thought of losing their benefits. (10) 

No matter the primary source of income people live on to make ends meet, it is clear that the amount they receive can either be a major stressor if it is inadequate or can alleviate a lot of pressure if their basic needs are met. Providing adequate and livable incomes will not necessarily solve all mental health challenges, but it will save lives. Any conversation on addressing mental health challenges needs to robustly consider the ways in which livable incomes and poverty intersect with this issue. 

Note: This is an excerpt from our December 2022 Community Matters, you can read the full publication here

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References 

1. Orpana, H.M., L. Lemyre, and R. Gravel. Statistics Canada (2009). Income and psychological distress: The role of the social environment. Health Reports. Vol. 20, no. 1 (March 2009). Pp: 21- 28. Retrieved from: https://www150.statcan.gc.ca/n1/en/pub/82-003-x/2009001/article/10772-eng.pdf?st=A55AkkD2  
2. Kaufman, J.A., Salas-Hernández, L.K., Komro, K.A., and Livingston, M.D. (2020). Effects of increased minimum wages by unemployment rate on suicide in the USA. Journal of Epidemiology & Community Health. Vol. 70, no. 3. Pp. 219-224. https://jech.bmj.com/content/74/3/219  
3. Government of Alberta (2020). Minimum wage expert panel. Retrieved from: https://www.alberta.ca/minimum-wage-expert-panel.aspx  
4. Issawi, H. and Doherty, B. (2018). Alberta’s minimum-wage workers tell us what $15 an hour really means for their bottom line. Retrieved from: https://www.thestar.com/edmonton/2018/09/30/paid-in-full-albertas-low-wage-workers-mull-over-the-final-pay-bump.html  
5. Wyton, M. (2019). ‘Difficult realities’: Vulnerable youth left in lurch by UCP cut to minimum wage, advocates say. Retrieved from: https://edmontonjournal.com/news/politics/vulnerable-youth-left-in-lurch-of-uncertain-pay-following-ucp-cuts-to-youth-minimum-wage  
6. Wilson, N. and McDaid, S. (2021). The mental health effects of a Universal Basic Income: A synthesis of the evidence from previous pilots. Social Science & Medicine. Volume 287. https://www.sciencedirect.com/science/article/abs/pii/S0277953621007061  
7. Ferdosi, M., McDowell, T., Lewchuk, W., and Ross, S. (2020). Southern Ontario’s Basic Income Experience. Retrieved from: https://labourstudies.mcmaster.ca/documents/southern-ontarios-basic-income-experience.pdf  
8. Canada. Employment and Social Development Canada (2018). Opportunity for All: Canada’s First Poverty Reduction Strategy. Retrieved from: https://www.canada.ca/en/employment-social-development/programs/poverty-reduction/reports/strategy.html  
9. Tran, P. (2022). Alberta’s government benefit programs to be re-indexed starting next year. Retrieved from: https://globalnews.ca/news/9309545/alberta-premier-danielle-smith-reindexing-aish/  
10. Fletcher, R. (2020). What it’s like living on AISH while the government spars over its future. Retrieved from: https://www.cbc.ca/news/canada/calgary/alberta-assured-income-for-the-severely-handicapped-feature-1.5752665