What lies behind unhappiness in the workplace? Sometimes, it is a matter of management shortcomings. But it could also reflect a general decline in happiness nationwide. Economist and forecaster Laza Kekic analyses the worsening inputs that comprise national happiness, and explains why the decline has been particularly strong in the US over the past decade. 

One of the most startling findings from the latest World Happiness Report for 2017 is the decline in life satisfaction in the US. The report is based on annual surveys by the Gallup polling organisation of self-reported life satisfaction in more than 150 countries. Aside from Greece and Spain, the US (which enshrines the right to pursue happiness in its Constitution’s preamble) suffered the biggest decline in life satisfaction of any developed country between 2007 and 2016. Jeffrey Sachs, the renowned American economist and one of the editors of the Report, has talked of America’s multi-faceted social crisis.

The World Happiness Report points to a number of explanations for life satisfaction, similar to those I set out in an earlier Economist Intelligence Unit study. Chief among these are material well-being (measured by GDP per head); health (life expectancy at birth); family life (divorce rates); political freedom ratings; job security (unemployment rates); personal physical security ratings (homicide rates); community life (membership of social organisations, church attendance); and governance (ratings for corruption).

American nightmare

The post-2008 crisis had a marked negative impact on the life quality of millions of Americans, especially working class whites. In the 2016 election, Donald Trump won each state that was in the bottom 20 US states on happiness measures, almost all in the rust belt or the deep south. Less-educated white Americans are strikingly pessimistic when interviewed about their lives. Despite growth in real GDP, their real wages have stagnated for more than three decades. The end of the post-war boom led to structural changes and a process of de-industrialisation. The number of manufacturing jobs, which once provided the livelihoods of non-college-educated workers, has declined dramatically in the US. There were more than 18m manufacturing jobs in the US in the mid-1980s; today the number has declined to little more than 12m. Over the same period millions of manufacturing jobs in the US were exported by corporations in search of cheaper labour. Charles Murray, an American sociologist, observed in his book Coming Apart: The State of White America, 1960-2010, that the consequences of these economic changes are visible across the country in terms of their negative social impact.

‘In the 2016 election, Donald Trump won each state that was in the bottom 20 US states on happiness measures, almost all in the rust belt or the deep south.’

The end of the post-war boom and the process of de-industrialisation has had an enormous impact on health, community and family life. In particular, mortality rates among white Americans have increased dramatically, unlike rates seen in other rich countries. This has been driven by indicators of despair, such as suicides and substance abuse. Between 1999 and 2015, some 600,000 Americans took their own lives. More than 30 countries have life expectancies exceeding the US level. Life expectancy in the US edged down 0.1 year to 78.8 years 2014-15—the first decline since 1993. The worst affected are again in ‘Trumpland’ states of the south and mid-west. The mortality rates of whites with no more than a high-school degree grew from being 30% lower than blacks in 1999 to 30% higher in 2015. At the same time deaths by drugs, alcohol and suicide among whites have increased in all parts of the country and at every level of urbanisation.

Homicide rates are high and the US has one of the world’s largest prison populations. Perceived corruption is higher than in many other developed countries. In a well-known study (Bowling Alone), Robert Putnam argued that the US has experienced a major erosion of civic, social and political life (social capital). Popular trust in political institutions has fallen to extremely low levels. Countless surveys in the US from the Pew Research Centre, the Gallup polling agency and the World Values Survey reports, which have revealed a long-term trend of declining confidence in political institutions and elites.

Although a long-term trend since the 1960s, in recent years confidence has fallen further, in the wake of disastrous wars in the Middle East, the Great Recession that followed the 2008-09 financial crash, and gridlock and dysfunction on Capitol Hill.

More misery forecast

Life is likely to get even worse in 2018 as most drivers of happiness either deteriorate further or fail to improve. Life expectancy in the US is on a declining trend, irrespective of what happens to Obamacare. The flip-flopping president Trump is not delivering on promises made to his white working-class constituency on economic nationalism, taxing the rich and ‘draining the swamp’ (corruption remains high and  trust in public institutions very low).

A robust economy and GDP growth will not be enough to offset all the negatives.

Laza Kekic Is an independent consultant specialising in political development, foreign direct investment, economic forecasting and growth economics.

This article was written for FT|IE Corporate Learning Alliance.
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