A UC Berkeley Labor Center Low-Wage Work Program report assessed how proposed CA Senate Bill No. 525, or SB 525, would affect healthcare workers, patients and the healthcare industry overall.
The bill, introduced by state Senator María Elena Durazo, D-Los Angeles, would establish a new minimum wage of $25 per hour for health care employees.
“Our job at the Low-Wage Work Program is to document and understand the conditions and policies affecting low-wage workers, including minimum wage policies,” said program director Enrique Lopezlira in an email. “We know many low-wage workers are in healthcare occupations, so we wanted to get a sense of how many workers would be affected by the proposal, understand the demographics of affected workers, and estimate what would happen to their wages.”
Lopezlira co-authored the investigation alongside Ken Jacobs, chair of the UC Berkeley Labor Center.
There is currently no unique minimum wage for healthcare workers, so the statewide minimum wage of $15.50 an hour applies, unless there is a higher local minimum wage in effect, according to Lopezlira.
Lopezlira noted the investigation also found that many healthcare workers currently do not earn enough to take care of their families and be self-sufficient.
“There is well established research showing increases in pay lead to reduction in staff turnover and increases to worker productivity, which ultimately leads to better healthcare outcomes,” Lopezlira said in the email. “The additional wage costs to healthcare facilities would be offset by lower turnover costs and higher productivity, and ultimately lead to improvements in the quality of care of patients.”
Specifically, the investigation found that almost 500,000 directly employed healthcare workers would receive an on average hourly wage increase of $5.74, translating to about a 30% increase in healthcare workers’ pay.
In order to come to these conclusions, the study pulled data from the American Community Survey 2016-2020 five year sample. Using this data, the researchers estimated the proportion of healthcare workers that would be impacted by SB 525, who otherwise would earn less than $25 an hour in 2024.
In the investigation’s report, the UC Berkeley Labor Center’s communications director also spoke to healthcare workers on how they would be personally affected by the proposed minimum wage increase.
Many cited how it could attract more people to become medical assistants, help pay their student loans and improve their work environment.
The bill is currently awaiting review by California’s Senate Appropriations Committee.