But even if you don't agree with that interpretation of the human right of life, prisoners typically aren't free participants in the market. They're being paid well below average wages for the work they're doing, which a) makes it feel like a technicality that they're getting paid for their work, and b) distorts the market for everyone else.
The right to life means that no one can deprive you of your life, but neither is society obligated to ensure you have a life.
The right of life means that you are owed a life and it must be given to you by the relevant authorities.
The reason this is important because the former gives you control over your life, and the latter operates at the whim of the governing authority. To make that a little clearer, the right to life requires passive governmental involvement, the right of life requires active governmental involvement. Guess which one goes out the window as soon as its inconvenient.
</pedantry>
And given the potential savings, why don't more governments do exactly that?