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Just How Does Work and Income Shape Our Happiness?

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A billion humans earn so little they go to bed hungry, while the International Labour Organization (ILO) estimates that there are 600 million who work “excessively long hours” trying to make ends meet. (This goes from a low of 5% of Norwegians to a high of 50% of Peruvians who work more than 48 hours weekly, and includes 10% of Canadian workers.) Meanwhile the “super-rich” of just 6,000 persons, or only .0001% of humanity, accumulates incomprehensible wealth and power, shaping the life chances of six billion people vulnerable within the global economy.

The American Situation

In such an upside-down world the assumed link between work, income and wellbeing is on shaky ground. In consumer societies people spend less and less time at paid jobs. A July 2009 New York Times survey found people spending more time watching TV and movies than socializing. If you add in “other leisure” and “travelling”, more time is involved than spent at work. Research shatters the view that earning more money leads to happiness. The percentage of Americans that say they’re “very happy” has stayed pretty much the same, clustering around $15,000 per capita GDP (gross domestic product) a year, even though per capita income has nearly tripled over 50 years. Once people start to make ends meet, values other than making money become paramount. Yet mass advertising, always trying to turn manufactured “wants” into “needs”, indoctrinates Americans to think otherwise. While people predict their own and other’s happiness will rise sharply as income rises, according to research reported in the journal Alternatives(35:6, 2009), actual happiness ratings don’t fluctuate much after $30,000 income.

There was a remarkable value shift among upcoming US students in the mid-1970s towards being “very well-off” financially rather than creating a meaningful life. By the 1980s a generation of consuming youth had swung full-circle from the protests and frugality of the sixties. This occurred when the neo-liberal politics of privatization, de-regulation and free trade was advancing and corporate globalization was expanding. But what actually happened with this push for unfettered growth and trading over recent decades? By 2007, 50% of all US income was going to the top 10% of earners. (From the post-WW II period until the early 1980s the top 10% received one-third of the total income.) Not surprisingly, the last time this happened was just before the crash and depression of the 1930s.

Economic ideology is not consistent with economic realities. While the rich got even richer since the 1980s, the overall working population was increasingly consuming through credit and debt rather than from rising purchasing power. The growing “middle class” may live in large new houses, with large new cars, but even two working-parent families often lack the cash flow to cover the costs of mortgages and loans. No wonder some writers refer to them as “the new working class”. Meanwhile single parent families fell further down the economic ladder. Though working harder and longer, while facing these economic-induced stresses, people certainly weren’t getting happier.

This blind, frustrated quest for more was aggressively promoted by the mainstream media in popular culture. The expansion of what became known as deregulated, multi-national capitalism, which put profitable markets above general wellbeing, ultimately led to the financial crash and multi-billion dollar corporate bailout of the last year. It’s in the wake of this that we are all challenged to visualize what a sustainable society might look like.

The Canadian Version

A similar process, though not as extreme, occurred in Canada. In a compelling interview on the TV program “Off the Page”, discussing his 1998 book, Titans: How The New Canadian Establishment Seized Power", Peter Newman says the new class of rich Canadians aren’t philanthropists with a social conscience, but “Social Darwinists”; suspicious, frightened and not that happy. Lacking the respect of old moneyed families, like the Eatons, those often referred to as the “filthy rich” have tried to buy respect, by donating large tax-write off “gifts” in return for having something big named after them.

Newman notes that it was in 1997 that Canada became a “money economy”; where more money was made from investing money than from wages and salaries tied to production of goods and services. Has this shift to more transparent greed undercut the belief that work and income increase happiness? It certainly matters how we view happiness. The US constitution speaks of “the pursuit of happiness” as though it is linked to the enterprising spirit. However, the author of the US Declaration of Independence Thomas Jefferson, saw happiness as coming from virtue, more like the Greeks who saw it in terms of the “well-being of spirit.” Canadians seems to be more concerned about contentment than happiness in the US sense.

Seeing happiness as linked to standard of living, measured in terms of income trickling down from limitless economic growth, ignores how social and environmental realities shape quality of life. There have been attempts to broaden measurements of wellbeing beyond the GDP. Those advancing the Canadian Index of Wellness (CIW) note in their June 2009 report that, while Canada has become “richer”, in aggregate, the 20% who were already rich just got richer. Meanwhile research from the UK’s New Economic Foundation suggests that only 10% of our happiness is connected to money, possessions and status attached to this. It seems that what Mark Anielski calls “genuine happiness” in The Economics of Happiness has to do with finding the right balance between society, economy and ecology, which is about sustainability.