… and the Pursuit of Happiness - Institute of Economic Affairs

… and the pursuit of happiness
wellbeing at work: any lessons?
absenteeism, the high level of incapacity benefit claims and the
promotion of mental health. It is one of many bodies stressing
the importance of ‘creating an environment to promote a state of
contentment which allows an employee to flourish and achieve
their full potential for the benefit of themselves and their organisation’
(CIPD, 2007: 4). This leads some commentators (for
instance, Brinkley et al., 2010) to argue for increased government
regulation to promote this objective.
This chapter outlines the theoretical background, methodology
and findings of the recent academic literature. There is
much of interest in this literature for economists. The chapter’s
conclusions, however, question the orthodoxy that supports
sometimes costly changes in personnel practices by employers or
regulatory interventions by government.
Objective and subjective measures of wellbeing at work
Looking purely at directly observable measures, the conditions
under which most people work in this country have never
been better. Crafts (2007) reports on long-run improvements in
living standards over the course of the twentieth century, citing
increased real earnings, improved health, greater life expectancy
and reduced poverty. Work is less dangerous and less tiring 1 and,
with higher incomes, people also have more choice over occupations,
hours worked and location. Work involves greater use of
skills and education, offers more variety and less repetition, and
1 Partly as a result of legislation but probably more importantly as a result of firms
using new technologies, and producing goods and services which demand less
physical and manual labour to produce, as a consequence of the switch from
manufacturing and extraction towards services.
gives more opportunities for interaction with fellow workers
and customers or clients. Although no job is ever wholly secure,
unwanted levels of casual employment (such as those that used to
prevail in the docks) are largely a thing of the past.
The average ‘quality’ of jobs, measured by this type of ob jective
indicator, has surely risen dramatically over the last century. And
these jobs are available to a wider range of the population, with
women now accounting for almost 50 per cent of the workforce. 2
But most of the focus in the literature is on states of mind
rather than objective aspects of the work environment. Subjective
wellbeing at work comprises a number of elements – physical and
mental health, social interaction and satisfaction with a range of
job attributes. Psychologists (for example, Robertson and Cooper,
2011) distinguish between two facets of personal wellbeing
deriving from work – ‘hedonic’, meaning subjective pleasure,
happiness and positive feelings, and ‘eudaimonic’, involving a
sense of purpose, personal growth and the conviction that one has
respect and a place in society.
The research flowing from this focuses on using survey data to
help identify factors (including both personal attributes and job
2 There may be fluctuations in job quality over shorter periods. There is some
evidence (Green, 2004; Brown et al., 2006) to suggest that work intensity rose
in the 1990s in the UK as a result of closer monitoring facilitated by changes in
work organisation and computer technology; this was regarded as oppressive by
some groups of workers. Intensity did not, however, continue to increase into the
new century and between 1998 and 2004 there appears to have been a significant
improvement in many aspects of job quality, including training, employment security
and the degree of influence individuals had over their work (Michie et al.,
2008). Moreover, Green (2011) and Waldfogel (2011), reviewing a slightly longer
period, argue that, over the term of the last government, pay rose, hours of work
fell and new employment ‘rights’ (such as enhanced parental leave) were made
available, thus further improving the directly observable quality of people’s work
experience.
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