(USA Today) Switzerland's residents are the most satisfied with their lives for the second consecutive year, according to the Better Life Index released last week. The study, published annually by the Organization for Economic Co-operation and Development (OECD), reported that United States failed to crack the top 10 for the fourth consecutive year, while neighbors Mexico and Canada did.
The Better Life Index rates the 34 OECD member nations, as well as Brazil and the Russian Federation, on 11 variables that contribute to a high quality of life, including income, education, housing, health, and life satisfaction. 24/7 Wall St. reviewed the 11 countries with the highest life satisfaction score.
One of the most important factors contributing to higher life evaluations is the presence of healthy job market. Of the 11 nations with the highest levels of life satisfaction, nine were among the top 10 nations by employment rate, measured as the percentage of the working-age population that is employed.
By contrast, nations with low life satisfaction scores typically had high unemployment rates. In Greece, the nation with the lowest life satisfaction score, 27.3% of the workforce was unemployed in 2013, the highest rate in the OECD. Similarly, low-scoring Poland, Hungary and Portugal all had high unemployment rates.
According to Romina Boarini, head of monitoring well-being and progress, at the OECD, jobs provide financial security, but they also impact a person's mental well-being. "When people lose jobs they don't just lose a salary, they really lose out on their ability to be connected to society."
Good health also contributes to life satisfaction. In eight of the 11 countries, a higher-than-average proportion of residents described their health as at least "good." In Canada, 88% of respondents rated their health as "good" or better, well above the OECD-wide 69%. Life expectancies were also quite high in many of these nations. In Switzerland, the top-rated nation for life satisfaction, the average life expectancy was 82.8 years, the highest of any country reviewed by the OECD.
Boarini noted that low life satisfaction can also negatively effect health, telling 24/7 Wall St. that "There's also a lot of evidence that when people are not very satisfied with their lives it has a negative impact on their health."
Another factor that may contribute to residents' life satisfaction scores in many of these nations is government spending, which includes transfer payments to citizens and purchases of goods and services. The governments of eight of the 11 top nations with the highest life satisfaction scores outspent the U.S., as a percentage of GDP, in 2013. Similarly, most spent more than the OECD average of 41.7% of GDP.
In the U.S., life satisfaction continued to drop, from 14th in last year's report to 17th in this year's report. This is despite the fact the U.S. led all nations in both disposable income and household net wealth per capita. One reason, Boarini highlighted, was that inequality remained pervasive in the United States. "We do know the more unequally the income is distributed the lower the life satisfaction." In fact, according to OECD statistics, the U.S. has a higher Gini coefficient — which measures the degree of income inequality in a country after accounting for taxes and transfer payments — than all but a few member nations.
Given how well the country scores in these measures, it is clear that life satisfaction cannot be explained just by considering job opportunities and health. For example, Mexico had extremely low scores in safety, environment, jobs, and health, but still was one of the top-rated nations for life satisfaction. Boarini highlighted this disparity as well, explaining that, despite the nation's problems "when you actually contrast that to what people are reporting they actually perform very well." She also noted that income inequality had declined, which could explain why life satisfaction has improved. "The country has become a little more egalitarian."
Based on figures published by the OECD as part of its annual Better Life Index, 24/7 Wall St. reviewed the 30 variables measured for each of the member nations and participating countries. The variables, in turn, make up 11 categories that together constitute the Better Life Index: housing, income, jobs, community, education, the environment, civic engagement, health, life satisfaction, safety and work-life balance. Figures used to calculate the Better Life Index and its components are from different years, and the values for individual nations represent the most current data available. Government outlays are from the November 2013 release of the OECD's Economic Outlook. Unemployment rates and life expectancy at birth which measures income inequality after taxes and transfer payments, for each country, were also based on data from the OECD.
These are the happiest countries in the world.
> Life satisfaction score: 7.8
> Self-reported good health: 81% (7th highest)
> Employees working long hours: 7.3% (17th highest)
> Disposable income: $30,745 (5th highest)
> Life expectancy: 82.8 years (the highest)
For the second consecutive year, Switzerland ranked higher than any other country in the life satisfaction score. Few countries rated higher than the small Alpine nation in measures of wealth. Per capita, Swiss residents had $30,745 in household disposable income and net financial wealth exceeding $100,000 per capita. Jobs were also relatively abundant, with 79% of the working-age population employed, the second highest percentage of any country reviewed by the OECD. Residents were also more likely to feel secure in their jobs than people in any other nation considered. In addition to being wealthy and secure in their employment, residents were extraordinarily healthy. The life expectancy for Swiss residents was 82.8 years, the highest of any country measured by the OECD. Additionally, 81% of residents felt they were in good health, well-above the 69% of people across the OECD.
> Life satisfaction score: 7.7
> Self-reported good health: 73% (15th highest)
> Employees working long hours: 3.1% (6th lowest)
> Disposable income: $32,093 (3rd highest)
> Life expectancy: 81.4 years (10th highest)
Norway's unemployment rate was just 3.5% last year, less than half the OECD's unemployment rate of 7.9%. Many workers were also paid quite well. Full-time Norwegian workers earned $46,618 annually on average in 2012, among the highest personal earnings among countries reviewed. Much of the country's wealth comes from energy sectors. Norway's economy relies heavily on its oil industry, and it is one of the largest oil producers in Europe. Like nearly all countries with residents who rate their lives well, Norway's environmental quality is good. As many as 96% of respondents said they were satisfied with the quality of their water, nearly the most among nations measured by the OECD.
> Life satisfaction score: 7.6 (tied for 3rd)
> Self-reported good health: 88% (3rd highest)
> Employees working long hours: 4.0% (11th lowest)
> Disposable income: $30,212 (7th highest)
> Life expectancy: 81.0 years (17th highest)
Canada's per capita disposable income exceeded $30,000, and the net financial wealth of its residents exceeded $63,000, both among the highest figures of any nation measured by the OECD. However, high income and wealth alone do not explain residents' happiness. In fact, the U.S. outperformed Canada in both measures, yet ranked just 17th in life satisfaction. Notably, while just 90% of Americans said they had someone they could rely on in an emergency — a measure used by the OECD to gauge the quality of communities — in Canada 94% said they had such a person, among the most of any nation. Canadians were also more likely to be working, and less likely to be unemployed, than their counterparties in the U.S., which also may contribute to residents' higher evaluations of their lives.
> Life satisfaction score: 7.6 (tied for 3rd)
> Self-reported good health: 71% (17th highest)
> Employees working long hours: 2.1% (4th lowest)
> Disposable income: $25,172 (15th highest)
> Life expectancy: 79.9 years (12th lowest)
Like other Scandinavian countries, Denmark's government plays a large role in the lives of its citizens — the country has high tax rates and a comprehensive welfare system. The government's total spending was equal to nearly 58% of GDP in 2013, second only to Finland. Excellent work-life balance likely contributed to Danes' life satisfaction. Danes devoted an average of 16 hours a day to leisure activities and personal care, more than any other nation reviewed. Country-residents are also well-educated, having spent an average of 19.2 years in school, third-highest among countries reviewed. When asked if they could count on someone in times of need, 96% of Danish residents responded affirmatively, compared with less than 90% across the OECD.
> Life satisfaction score: 7.5 (tied for 5th)
> Self-reported good health: 69% (tied-17th lowest)
> Employees working long hours: 8.6% (15th highest)
> Disposable income: $29,256 (9th highest)
> Life expectancy: 81.1 years (13th highest)
Austrians were among the most likely people of any nation to be employed. While across the OECD 65% of the working-age population was employed, in Austria, 73% of the population was. Additionally, residents were far more likely to feel they had job security, as the nation's long-term unemployment rate was just 1.1%, far below the OECD's rate of 2.7%. Residents were also quite happy with the quality of their community, with 95% stating they had a support network they could rely on in an emergency. Austria's environmental quality was also quite high, potentially contributing to people's' happiness. Residents rated both air and water quality among the highest of any nation reviewed. High levels of government spending may have also enabled the country to provide public services, such as a social safety net and health care, that could drive up quality of life. Austria's government spending totalled nearly 52% of GDP, among the most of any nation reviewed.