Why are millennials getting less happy every year?
The Economics of Happiness
Why do many people feel their lives aren't fulfilling? Why aren’t we so happy as our parents? And why do economists care about happiness?
The latest World Happiness Report published this week revealed that young people in the West are becoming unhappier. The US, for the first time, is out of the top 20 happiest countries in the world, a drop explained by the lower happiness levels of those under 30. Among millennials, the report found that happiness ratings declined with each year of age, while satisfaction for baby boomers increased with age.
But why are millennials and Gen Z getting unhappier with age? We have more products to consume, much more educational opportunities and more free time than our parents had. If we use the mainstream measure of economic well-being GDP per capita, people living in the west should have been the happiest. But as it has been mentioned in previous blogs, GDP per capita is only a measure that counts the value of products and services created in an economy. It doesn't take into account how we feel, how we spend our spare time, or how happy we feel.
To fill these gaps, economists and sociologists started measuring the subjective well-being of individuals, or as it has been called the ‘economics of happiness’. With these measures we can identify how happy a nation is, how people feel that their life is worthwhile, how lonely we feel and whether we have meaningful relationships.
The OECD ‘How's Life?’ report has managed to create a comprehensive index that combines measures of economic and subjective well-being, taking into account that our economic well-being is closely related with our subjective well-being. It also takes into account inequalities between groups, top and bottom performers and also identifies what resources we need for the future of our wellbeing.
Source: OECD
According to the latest data from OECD’s Better Life Index, the well-being of the UK’s citizens is reducing, mainly for economic reasons. Households have seen their debt increase because of higher interest rates and increased cost of living, while at the same time they find it hard to participate in the labour market. And that is prevalent for young people below the age of 30, as they leave university with an average debt of £44,730 last year in England - a rise of more than 16 times since 2000, when they owed £2,690.
Although a large part of this debt is due to student loan, which is financed slightly differently to regular loans, this is not the only financial problem that young people are facing. They have increased their other debts because of the higher cost of living crisis and challenges they face to get into the labour market after finishing university. A survey of 2,000 UK adults commissioned by Tesco Bank revealed that 48 percent of 18-to-24 year olds are currently in debt, rising to 65 percent of 25-to-34 year olds. As a result they have lower levels of savings and much less likelihood to be able to afford a house in the future - according to a previous blog those born in the 1970s were less likely to own homes than those born in the 1950s and 1960s were at the same age, and those born in the 1980s were even less likely.
Being not able to afford a living, secure a home or participate in social activities especially at a young age may lead to mental health disorders. According to data from the NHS, 17 to 25 year olds with a probable mental disorder were 3 times more likely to not be able to afford to take part in activities such as sports, days out, or socialising with friends, compared with those unlikely to have a mental disorder (26.1% compared with 8.3%).
But is it only their finances that young people are worried about, and what else might be impacting their enjoyment of life? The World Happiness Report sounds an alarm on the use of social media by young people as well. Of course, social media can in many respects bring us together and helps us maintain connections, but since we started using them we have also seen an increase in depression and anxiety among students in both the US and UK. More worryingly, we have seen an increase in self harm and suicides among young people.
Social media makes us compare ourselves with others almost every time that we use our phones. Think about it - every time you use Instagram a lot of time, many times unconsciously we might think “why does my friend have a better body than me? Why can't I afford a holiday? Why are they more successful than me?”
We use social media as the highlight of our lives, we mostly post happy moments about how beautiful or successful we are. Rarely will you see a post showing how vulnerable we are. And we measure our value based on the social currency, which is how many likes or views we get from others. Sometimes we take multiple pictures and wait for the correct moment to post our stories so we can get as many likes as possible.
And then there is the Fear of Missing Out (FOMO), have you ever thought that you just keep your social media accounts only because you are afraid that you are going to lose your social contacts or you will stop getting invited to social events? Many people do, I was one of them. It took me a lot of thought to delete my Facebook account after the Cambridge Analytica scandal, but by deleting it I didn't lose any of my friends.
One huge problem is when people face online harassment and they still keep their accounts. The Alan Turing Institute reports that between 30% and 40% of UK citizens have witnessed online abuse in some form, and between 10% and 20% have been the direct victim of online abuse personally.
Social media isn’t either good or bad, and the purpose of this blog is not to tell people to stop using them. We always need to remember that Twitter doesn’t itself make people write hateful posts. The purpose here is to make people aware of the mental health issues that the non-safe use of social media can create. The anxiety to have a perfect family, the eating disorders that you can fall into in your race to get the perfect body, or the abuse that you're getting from people because of your personal characteristics. Social media doesn't have to affect your mental health negatively and that is why we need to use it safely according to our needs, if that means blocking people, limiting the time we use it or taking a long break till we are strong enough to be back.