Happiness beats GDP hands down

Economist Ed Conway claims in The Times that “GDP is actually pretty good at measuring the total amount of income generated in Britain”

His main point is that:

  • Every politician from right to left obsesses about income above all other measures of progress
  • Yet income comes surprisingly far down the list of what really matters to people

 

Losing a major chunk of your pay certainly dents your well-being but losing your job reduces it three (?) times as much

A job not only provides an income but social interaction, satisfaction from completing tasks, routine and a change of scenery – all things which keep us happy

This leads him to claim: “Levels of happiness across a population are a better predictor of election results than economic statistics such as GDP, and they’re linked to higher productivity” – (the latter being a ‘chicken and egg’ question)

Levels of happiness bear out that:

  • People are far more dented by losses than gains
  • Recessions leave lasting scars
  • We deeply resent it when others earn more than us

 

The story they tell is quite distinct from the one told by our income levels:

  • Real incomes are facing a big squeeze
  • Britain’s national income remains weak

 

Nevertheless, according to economists Colin Green, Alex Bryson and Andrew Clark, not only are levels of life satisfaction among British workers higher than before the 2008 crisis, they are now at the highest level since comparable records began in 1991

So, for all the disappointment over our (apparent) GDP levels, employment is at the highest level in history

However, the happiness gap between the vast majority employed and relatively few unemployed is said to never have been greater

 

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