It’s time we realised that GDP growth isn’t everything, and that happiness – or the lack of it – also has an economic cost

Since the 1990s, Britain has had one of the world’s most skewed income distributions

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Suppose we started to think as much about wellbeing as about economic growth, what difference would that make? There has recently been a lot of research into measuring people’s happiness and satisfaction with their lives. “Wellbeing and Policy”, a piece of work led by Gus O’Donnell, the former Cabinet Secretary, is a useful compendium. Here are some of the insights.

In terms of wellbeing, people lose more from a fall in income than they gain from a rise in income by the same amount. Hence the agony of the long decline in the purchasing power of wages and welfare payments at the lower end of the income scale. The research also emphasises that unemployment is a terrible experience for most people and – crucially – not something that one adjusts to. A high unemployment rate also spreads fear. So Britain’s relatively good record in keeping people in work will have preserved the country’s sense of wellbeing at a higher level than might have been have expected.

But, pointing in the other direction, the effects of bad health upon life satisfaction are said to be huge and bigger than the effect of losing income. The research also emphasises that mental illness is an even more important predictor of life satisfaction than physical illness, income, employment or family status. Moreover, mental illness is very common.

This is a wake-up call. For many years there has been a single-minded concentration on economic growth. It was from that point of view that the Budget speeches of successive chancellors of the exchequer and the daily flow of financial statistics have been read. So it wasn’t immediately realised that Britain had acquired a more skewed distribution of wealth since the early 1990s than almost anywhere else in the world – and that this could have unfortunate consequences. Not least among these was that it would make economic growth harder to achieve.

The breakthrough text was The Spirit Level: Why Equality is Better for Everyone by Richard Wilkinson and Kate Pickett, published in 2009. One of the authors’ more striking insights was that as well as knowing that health and social problems are more common among the less well off within each country, “we now know that the overall burden of these problems is much higher in more unequal societies”. The two authors asked: how is it that we are affected as strongly by inequality and our position within society as the data suggests? The answer appears to be that we have become much more anxious than we used to be.

What is going on was described very well by the American writer, Alison Lurie, who won the Pulitzer Prize for her novel Foreign Affairs, in a recent article in the New York Review of Books – and she is in her late 80s. She noted that when we get together “we tend to gossip not about our own relatives and friends and neighbours and co-workers, but about film and TV and sports stars and members of the British royal family … In advanced cases of celebrity complex, the afflicted persons feel that fame is necessary to self-esteem; if they cannot achieve it themselves, they may define and value themselves most importantly as fans.” That is a description of anxiety.

These insights put into context the initiative announced this week by the charity Business in the Community, together with Mind, to launch a campaign to end the “culture of silence” surrounding mental-health problems in the workplace. And to emphasise the seriousness of the problem, it gives estimates for the economic cost of this neglect. Issues such as stress are calculated to cost the UK economy £70bn a year – or 4.5 per cent of GDP. The burden on employers amounts to at least £26bn, or £1,035 per employee. Moreover, last year 15.2 million sick days were caused by anxiety, stress or depression, up from 11.8 million in 2010.

In fact, thinking about wellbeing may help to resolve certain problems that are currently seen as purely economic, such as Britain’s very low level of productivity. In a speech earlier this year, the new Governor of the Bank of England, Mark Carney said: “Given the continued openness of the economy and the credibility of macro policy, it is hard to think of any reason why there should have been a persistent deterioration the UK’s productivity performance.”

What about mental-health problems in the workplace? Might they be at least part of the answer?

'Noah' was fine until the zombies arrived

When I went to an early screening of Darren Aronofsky’s new film, Noah, I was expecting one thing and got another. The story of Noah, who was instructed by God to make an ark and fill it with every sort of living thing so as to survive a flood that would destroy all life on Earth, is recounted in the Bible as well as in the Qur’an. Similar stories are found in other ancient civilisations.

Noah, therefore, has always gripped the imagination. And I had hoped that, with all the resources of Hollywood, it would be a fine contribution to the many attempts that have been made through the centuries to imagine how the ark might have been designed, how Noah and his family and his zoo could have survived, and where the vessel might have ended up. I was looking for a literal reading of the ancient accounts.

There is an additional reason why the adventure still fascinates. For it is still lived out today. When you see refugees in, say, Syria, attempting to come through the calamity of civil war by piling their worldly goods into an old cart which they push along dusty roads to the hoped-for refuge of a camp, that is still in essence the story of Noah – the family carrying its meagre possessions to a place of safety.

That is not, however, the film that opens this week. Its great merit is that Russell Crowe gives a towering performance as Noah. But alas a major role is also played by a group of zombies, so-called “watchers”, fallen angels who seek to protect Noah from his enemies. I am afraid I could only laugh when these ridiculous creatures appear. The spell was broken. I suppose that I should have paid more attention to the film’s description – a “biblical-inspired fantasy film”.

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