Is money and happiness related?

Have you ever heard the famous saying “money can’t buy happiness”? Well I have done some research and I think it is safe to say that whoever came up with that saying obviously had enough money to survive. I am about to be halfway done my college career so the real world is right around the corner. But before I enter the real world and start my big girl job, I want to know if it is possible to live a happy life that I’ve always dreamed of while living comfortably (a.k.a making enough money to survive).


Interview

This is a picture of my dad and I from last year when I forced him to go to skydiving with and it was wild! But anyway, I began my research by interviewing him. My family is originally from England and we moved here when I was five with my Dad’s job. I decided to talk to him about the differences of working and living in England and America. During the interview we discussed his working hours, vacation time, and the overall advantages and disadvantages of living and working in each country. I’ll be going into more detail about this interview while discussing my primary sources. But, yeah… he’s a pretty cool guy.

World Happiness Report 2017

I know exactly how I can live a happy life while living comfortably… Move to Europe!

Just kidding… kinda?

The image above is taken from the “2017 World Happiness Report” and shows the top 53 out of 155 countries, in order of happiness. Compared to the bottom of the list, the happiest countries have highest levels of GDP per capita (blue), social support (yellow), healthy life expectancy (red), and freedom to make life choices (navy). When looking at the least happiest countries, I noticed that they were earning the least amount of money and had minimal benefits. I am assuming this relationship happens for obvious reasons. If someone has enough money to provide food, shelter, and other necessities for themselves and their family, they are going to be happier and less stressed. Life satisfaction also increases when the government helps its citizens by providing welfare, insurance, and education, which is discussed in one of my later primary sources. But, when the government provides these benefits, people are better educated which leads to better, well-paid jobs. And, having welfare and insurance provided for one’s family is definitely less stressful than having to pay hundreds to thousands of dollars when an unfortunate accident happens. Looking into source and realizing that the happiest countries are made up of people earning the most money is how I thought of my research question: Is money and happiness related?

Does a higher minimum wage make people happier?

This graph was taken from the article “Does a Higher Minimum Wage Make People Happier?” by the Washington Post. The graph clearly shows that when minimum wage increases, life satisfaction increases. It also pins countries on the graph depending on their minimum wage. This relationship is similar to the happiest countries in the World Happiness Report having the highest GDP per capita. When you are earning enough money, your life satisfaction is higher. What I thought was extremely interesting about this article is that the countries Norway, Denmark and Sweden (which are ranked numbers 1,2, and 10 happiest countries according to the 2017 World Happiest Report), are countries whose governments do not set a minimum wage according to this article. The governments of these countries leave minimum wage for the businesses and people involved in the labor unions to negotiate. Surprisingly, this usually leads to higher minimum wage. And from what I have seen in the World Happiness Report and this article, a higher wage leads to happier people. Thinking about this made me wonder what would happen if the United States followed this process. If the U.S. government let American businesses negotiate wages with labor unions, I predict the powerful businesses would try to take full advantage of the labor unions. Although a part of the point of paying your workers a reasonable amount is so they have money to also be customers to your business, I believe many people’s jobs would be replaced by machines and robots to avoid having to pay workers more. Even though the U.S. will probably never try this process, I do believe that increasing the minimum wage would increase life satisfaction and would make the citizens of the United States much happier.

All About Unions

After reading the past article by the Washington Post about how labor unions and businesses in Europe negotiate worker’s wages, I decided to expand my knowledge on labor unions. I found this website that has all the information you need to know about labor unions in the United States. A labor union is an organization of workers joined to protect their common interests and improve their working conditions. The main purpose of a labor union is to give workers the power to negotiate for better working conditions and pay through collective bargaining. A bargaining unit is a group of employees that perform similar work and usually work in the same area. Employees in a bargaining unit have similar interests and concerns when it comes to their working conditions. A collective bargaining agreement is an agreement negotiated between a labor union and an employer that sets the terms of employment for the employees who are members of that labor union. A collective bargaining agreement may include provisions regarding wages, vacation time, working hours, working conditions, and health insurance benefits. Once a collective bargaining agreement is in place, management cannot reduce wages or change working conditions without first negotiating with the employees. Employees are entitled to vote on changes made to their contract. These collective bargaining agreements reminded me of a severance agreement. During the interview with my dad he discussed how one of the benefits of working in England compared to the United States is the fact severance agreements are much more popular. An example of a Severance Agreement is shown below.
Guaranteed Severance Packages are very popular in Europe and my Dad talked about how its is a huge advantage because it really minimizes the blow of being fired. Severance Agreements usually start off by discussing pay and benefits for employee. These agreements also include conditions about being fired or let go. The one I researched stated that the employee legally cannot sue the company after being fired. It also set up benefits and compensation for the employee after being let go. This is a huge positive for society because if a company has to cut down on employees for financial reasons, even though the employees did nothing wrong, they still have some money and benefits in order to survive until they find more work. Also, the company may decrease its turnover rate. If the employer knows that firing an employee without a legitimate reason will result in them owing the employee benefits and money, then the employer may only fire employees if they had legitimate reasons. Also, people who were let go of their jobs will not have to rely on unemployment provided by he government as much because of the compensation and benefits they continue to earn. When the termination of an employee is done professionally and with a severance package, the employee being terminated is less likely to lash out by suing or trying to ruin the company’s reputation. Researching Severance Agreements made me wonder if the countries that tend to offer severance agreements are also the countries that are ranked higher when it comes to happiness. I found that these agreements are the most popular in Europe. 7 out of the top 10 happiest countries in the report are in Europe. I believe having these agreements leads to less stress and more happiness. They also increase the trust between the employee and the business they are working for.

Does the United States have a smaller social welfare programs compared to other countries?

I found a very interesting article from the Heritage Foundation named “Social welfare in the United States and other nations”. The United States has a higher per capita government social welfare spending compared to European countries. This is surprising to me because the majority of the United States social programs tend to only target the poor and the elderly. European social programs seem to be “bigger” because they are able to provide more to everyone, no matter what age you are. My father brought up during his interview how he believes he had more benefits when working and living in England compared to the United States. The government provided him with healthcare and free education even though he was a part of the middle class. His parents who still live in England now both work at the local church in their town. They live very simply lives and barely make enough money to live off of. If the British Government did not provide as much welfare as they do, they would not be living the happy lives they are living now. Although it is a positive that everyone has access to healthcare and secondary education, it does come with a consequence. My Dad discussed how living with these benefits in England resulted in making much less money due to extremely high taxes that go to the government to make welfare possible. As the article discussed, the target groups of U.S. social welfare programs tend to be the poor and the elderly while the working and middle class are left to rely on their own resources, a fact that is often mis-recognized in contemporary discussions of health care. I do believe that calling the United States’s social welfare programs small compared to other nations is an incorrect statement since a much larger amount of money per citizen is put into it. But, I do believe other countries have better systems set up to be able to provide welfare and educations for everyone.


Americans Work 25% More Than Europeans

This article opens up with the statement that workers in the United States put in more hours, retire later, and take less vacation days than anywhere else. It talks about how a study shows the average person in Europe works 258 fewer hours per year (19 percent less) than Americans. Many of the points brought up in this article were also discussed during the interview with my Dad. My Dad discussed how he prefers working in the United States because he is more likely to “move up the ladder” and is rewarded for his hard work. I do believe that is a part of the reason why Americans work more than Europeans. They come in early and leave late to get more work done and to prove themselves to their bosses. This is unheard of in the workplace in Europe. They believe it is important to use your free time for yourself and family. Working this much results in employees competing for the title of “who works more” and it turns into a hostile work environment. I thought it was very interesting that there are more Americans over the age of 50 working in the U.S. now than ever before. A reason for that could be because the U.S. does not have a generous pension like Europe because they moved away from traditional pensions to 401k plans. These plans make it harder for Americans to know when it is safe for them to stop working which is why Americans are working the extra hours and taking less vacations. In relation to the 2017 World Happiness Report, I believe that working less hours and taking more vacations increases happiness especially because most of the happiest countries are in Europe.It is crazy to believe that only forty years ago Europeans and Americans worked the same amount of hours but the American working culture has recently become a non-stop working machine.


In Conclusion…

After spending my semester researching these sources, I think it is safe to say that money and happiness are related. As minimum wage increases, life satisfactions increases. When a government offers it’s citizens more welfare and free secondary education, their citizens are overall happier. Also, when companies and employees negotiate things like wages and come up with agreements such as the guaranteed severance agreement, the employees are less stressed. I think its time we all admit… Money CAN buy happiness!

Thank you!

References

Helliwell, John, Richard Layard, and Jeffrey Sachs, eds. “World Happiness Report 2017.” World Happiness Report 2017 I (2017): n. pag. Web. 23 Mar. 2017.

Radcliff, Benjamin, and Michael Krassa. “Does a Higher Minimum Wage Make People Happier?” The Washington Post. WP Company, 14 May 2014. Web. 23 Mar. 2017.

Rector, Robert. “Poverty and the Social Welfare State in the United States and Other Nations.” The Heritage Foundation. N.p., 16 Sept. 2015. Web. 23 Mar. 2017.

“Severance Agreement Template — Free Download on UpCounsel.” UpCounsel. N.p., n.d. Web. 28 Mar. 2017.

Steverman, Ben. “Americans Work 25% More Than Europeans, Study Finds.”Bloomberg.com. Bloomberg, 18 Oct. 2016. Web. 23 Mar. 2017.

“Workers, Employee, Employment and Job Rights — Workplace Fairness.” Employee Rights, Job Rights, Workers Rights. //www.workplacefairness.org, n.d. Web. 12 May 2017.