CentrePiece Autumn 2017

What roles do work, and joblessness play in shaping our ? Jan-Emmanuel De Neve and George Ward summarise global evidence from the World Happiness Report on which elements of people’s working lives drive their reported satisfaction, engagement at work and overall wellbeing. Happiness at work ince most of us spend much of specific measures, such as of 10, whereas people working in farming, our lives working, it is inevitable and . fishing or forestry evaluate their lives that work plays a key role in around 4.5 out of 10 on average. shaping our levels of happiness. Which are happiest? This picture is true not only for overall SIn a chapter of the World Happiness Eleven broad job types are recorded in the life but also for the specific, day- Report 2017 – which is published annually Gallup World Poll. The categories cover to-day emotional experiences of workers. to coincide with the United Nations’ many kinds of jobs, including being a White-collar workers generally report International Day of Happiness – we look business owner, worker or manager, experiencing more positive emotional more closely at the relationship between and working in farming, construction, states, such as smiling, laughing and work and happiness. mining or transport. Which groups of enjoyment, and fewer negative feelings, We draw largely on the Gallup World workers are generally happier? such as worry, stress, sadness and anger. Poll, which has been surveying people in The first thing we notice is that people These descriptive statistics represent over 150 countries around the world since working in blue-collar jobs report lower the raw differences in happiness across 2006. These efforts allow us to analyse levels of overall happiness in every region job types. Of course, there are likely to data from hundreds of thousands of around the world. This is the case across a be many things that differ across people individuals across the globe and investigate variety of labour-intensive industries, such working in these diverse fields that could the ways in which elements of people’s as construction, mining, manufacturing, potentially be driving these happiness working lives drive their wellbeing. transport, farming, fishing and forestry. differentials. Perhaps surprisingly, much of Subjective wellbeing – often loosely People around the world who categorise the picture remains similar even once we referred to as happiness – can be measured themselves as a manager, an executive, an adjust our estimates to take account of along multiple dimensions. We look official or a professional worker evaluate differences in income and education, primarily at how people evaluate the the quality of their lives at a little over 6 out as well as a number of other demographic quality of their lives overall, something variables, such as age, gender and Gallup measures according to the Cantril marital status. Ladder, an 11-point scale where the top It is more difficult to generalise about step is your best possible life and the happiness associated with self-employment bottom step is your worst possible life. since this appears to have a multi-faceted Gallup then asks respondents to indicate Work-life relationship with wellbeing. When we look which step they’re currently on. balance is a at global averages, we see that being self- We look at this rating, and also employed is generally associated with lower investigate the extent to which people particularly levels of happiness compared with being a experience positive and negative affective strong predictor full-time employee. But follow-up analysis states, such as enjoyment, stress and indicates that this very much depends on worry, in their day-to-day lives, as well as of people’s the region of the world and the measure of analysing responses to more - happiness subjective wellbeing used.

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In most developed countries, being self-employed is associated both with higher overall life evaluation and with more negative daily emotions, such as stress and worry. For anyone who owns a business, it will be no surprise that being self-employed can be both rewarding and stressful.

Being unemployed is miserable One of the most robust findings in the economics of happiness is that unemployment is highly damaging for people’s wellbeing. We find that this is true around the world. The employed evaluate the quality of their lives much more highly on average compared with the unemployed. Individuals who are unemployed also report around 30% more negative emotional experiences in their day-to-day lives. The importance of having a job entails more than just . A large body of research shows that the non-monetary aspects of employment are also key drivers of people’s wellbeing. Social status, social relations, daily structure and goals all exert a strong influence on people’s happiness. Not only are the unemployed generally unhappier than those in work, but we also find that people generally do not adapt over time to becoming unemployed unlike their responses to many other negative shocks. What’s more, spells of unemployment also seem to have a ‘scarring’ effect on people’s wellbeing, even after regaining employment. The experience of joblessness can be devastating to the individual in question, but it also affects those around them. Family and friends of the unemployed are typically affected, of course, but the spillover effects go even further. High levels of unemployment typically heighten people’s sense of job insecurity, and negatively affect the happiness even of those who are still in employment.

High degrees of job satisfaction can hide low levels of engagement at work

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jobs. In contrast to the relatively high job This article summarises ‘Happiness at Work’ Happiness helps satisfaction numbers, these data paint a by Jan-Emmanuel De Neve and George to shape job much bleaker picture. The number of people Ward, CEP Discussion Paper No. 1474 saying they are actively engaged is typically (http://cep.lse.ac.uk/pubs/download/ market outcomes, under 20%, and around 10% in Western dp1474.pdf) and published as a chapter and Europe and much lower again in East Asia. in the World Happiness Report 2017 The difference in the global results (http://worldhappiness.report/ed/2017/). firm performance between job satisfaction and employee engagement may partially be attributable Jan-Emmanuel De Neve, associate professor Job satisfaction around to measurement issues. But it also has to do of economics and strategy at the Saïd Business the world with the fact that both concepts measure School, University of Oxford, is an associate What about wellbeing measures specific different aspects of happiness at work. editor of the World Happiness Report. to the workplace, such as job satisfaction? Job satisfaction can perhaps be reduced George Ward is a PhD student at the The Gallup World Poll asks respondents to feeling content with one’s job, but the Institute for Work and Employment Research, a yes/no question as to whether they are notion of active employee engagement MIT Sloan School of . satisfied with their jobs. The percentage of requires individuals to be positively absorbed Both are research associates in CEP’s respondents who report being ‘satisfied’ by their work and committed to advancing wellbeing programme. (as opposed to ‘dissatisfied’) is higher in their employer’s interests. Increased countries across North and South America, employee engagement thus represents a Europe, Australia and New Zealand. more difficult hurdle to clear. Specifically, Austria takes the top Although we focus here on the role spot with 95% of respondents reporting of work and employment in shaping being satisfied with their jobs. Austria is people’s happiness, it is worth noting that followed closely by Norway and Iceland. the relationship between happiness and We see a moderate correlation between job employment is a complex and dynamic satisfaction responses and life evaluation for interaction that runs in both directions. individuals in the Gallup World Poll. Indeed, a growing body of research shows People in blue- To find out why some societies seem that work and employment are not only to generate greater job satisfaction than drivers of people’s happiness, but that collar jobs report others, we turn to more fine-grained data happiness can itself help to shape job lower happiness from the European Social Survey. This market outcomes, productivity and even provides more information on job quality by firm performance. everywhere in revealing particular workplace characteristics the world related to employee happiness. As might be expected, people in well-paying jobs are happier and more satisfied with their lives and their jobs, but a number of other aspects of people’s jobs are also strongly predictive of varied measures of happiness. Work-life balance emerges as a particularly strong predictor. Other factors include job variety and the need to learn new things, as well as the level of individual that employees enjoy. Moreover, and social capital (as measured through the support received from fellow workers) are also positively correlated with happiness, while jobs that involve risks to health and safety are generally associated with lower levels of wellbeing. We suspect that countries that rank high in terms of job satisfaction provide better quality jobs by catering to these non- pecuniary job characteristics.

Engagement at work The Gallup World Poll also asks whether individuals feel ‘actively engaged’, ‘not engaged’ or ‘actively disengaged’ in their

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