What Germany is like as a place to live

Family, work, income, culture – what factors make up quality of life?
by Janet Schayan

Happiness is at home in the north. And in the far south. At least that’s the case in Germany according to data published in September 2012 in Deutsche Post’s German Happiness Atlas (Glücksatlas). Of 19 regions looked at in Germany, Hamburg is where people are most satisfied. In second place are people living on the North Sea coast, followed by the Bavarians. On average, Germans rate their life satisfaction at around seven on a ten-point scale, putting them in the top third worldwide. There is now a difference of only 0.2 points between how people in western and eastern Germany rate their quality of life – a gap that has never been so small since German reunification. In 1991, there was still a 1.3-point “happiness gap”. In comparative studies of life satisfaction in 29 European countries, Germany has gained considerable ground, moving up from 15th place in 2006 to 9th place today.

But how do we measure happiness and quality of life? Isn’t it a very private, subjective matter? At all events, happiness research – a discipline somewhere between sociology and economics – studies many individual factors that, taken together, give an overall picture. These include health, partnership, social relationships, occupation and income. But a sense of personal security and trust in policy-makers and the rule of law are also important factors in quality of life. The Happiness Atlas, compiled by a team led by prominent public finance researcher Bernd Raffelhüschen of the University of Freiburg, is regarded as the most comprehensive and up-to-date study of life satisfaction in Germany. It is largely based on the Socio-Economic Panel (SOEP) dataset. Begun as early as 1984, this representative longitudinal study looks at various aspects of people’s lives in Germany based on annual surveys of 11,000 households. The authors of the Happiness Atlas also draw on survey data collected by the Allensbach Institute for Demoscopy as well as other sources.

According to the atlas, people living in Hamburg are also particularly satisfied with their city. They award it 84 out of a possible 100 points, the best score among 13 large German cities. The cities of Dusseldorf and Dresden are also rated highly by the people living there – this being largely due to both hard location factors like econ­omic attractiveness and a combination of other assets: a rich and varied cultural life, good transport infrastructure, good air and water quality and recreational opportunities. The big cities fare less well in terms of social cohesion and what they have to offer children and families. It’s no surprise that a city’s rating as a business location is a factor in life satisfaction. The Organisation for Economic Co-operation and Development (OECD), which for many years now has also been conducting surveys to measure prosperity, comes to this conclusion: high employment rates make for healthier and politically more stable societies. The title of one of its studies says it all: Better Skills, Better Jobs, Better Lives. In the OECD’s latest Education at a Glance 2012 report, Germany scores much better than in previous years: general unemployment is low and youth unemployment is the lowest in Europe; the number of young people entering higher education is at a record high and the higher education graduation rate has risen to 30% – more than double the 1995 figure.

The OECD report also shows that the higher a person’s level of education, the higher their personal income level and the lower the risk of their becoming unemployed. According to Federal Statistical Office (Destatis) figures, four out of ten gainfully employed persons in Germany work in high-skill occupations. The proportion has increased sharply: in 1992 only three out of ten were in high-skill jobs. For many people, a “good job” is also an important prerequisite for satisfaction and quality of life – that is the conclusion reached by Destatis in its study Quality of Work – Earning Money and Whatever Else Counts, 2012. After all, many people spend more time at their place of work than with their family or friends. 88% of German employees are “satisfied overall” with their work situation, more than the EU average of 81%. An essential factor in satisfaction and quality of life is the balance between work and leisure. In Germany, weekly working hours have decreased since 1991, by three hours to 35.4 hours, one of the lowest levels across OECD countries.

Is having a good job and earning a decent wage all that counts? International happiness researchers have found that in Western industrialized countries there is little correlation between an increase in gross domestic product (GDP) – the value of all the goods and services a country produces in a given year – and people’s satisfaction with their own lives. Nuremberg economist Karlheinz Ruckriegel observes this trend in Germany, too: “The Socio-Economic Panel’s figures show no correlation between per capita GDP and life satisfaction over the past 20 years.” To put it in a nutshell: money does not make people happier. At least not on its own or if people’s basic material needs are already satisfied. Experts gen­erally agree that economic growth has had its day as a key quality of life measure.

A scientific commission chaired by American Nobel Prize winner Joseph E. Stiglitz was tasked by the French government with examining how economic performance and social progress can be 
measured without using financial indicators like GDP. The commission suggested that economic policy should not be geared to growth but rather to goals such as objective quality of life (health, education and the environment) and ecological sus­tainability. In late October 2011, the OECD published a study entitled How’s Life? Measuring Well-being, in which it proposes 11 indicators to measure quality of life and well-being. Here, too, the focus is on people rather than overall economic development. In this so-called Better Life Index, Germany ranks in the upper midfield.

In Germany, too, a debate is under way on what really constitutes quality of life. The German Bundestag has set up a Committee of Enquiry on Growth, Prosperity and Quality of Life that commenced work in 2011. The aim of the committee, which is made up of 34 researchers and parliamentarians, is to refine the purely economically and quantitatively based indicator GDP as a measure of societal well-being by adding ecological, social and cultural criteria. These might include indicators such as income distribution, level of debt, ecological footprint, educational opportunities and innovativeness. Much of this information is, of course, available in published form. “What we don’t have,” says Beate Jochimsen, a committee member and professor of public finance in Berlin, “is a dataset that presents indicators in a clear and well-structured way.” Gert C. Wagner, another committee member and Chairman of the Executive Board of the German Institute for Economic Research, also supports the idea of setting up a new body, a Council of Experts on Sustainable Quality of Life. This body could provide regular information on changes in prosperity and quality of life, complementing the assessment given by the “Five Econ­omic Sages” in their annual report on macroeconomic development.

But the – sometimes quite hefty – debates in the committee of enquiry’s four project groups are still in full swing. “There are serious differences of opinion, particularly on the importance of economic growth,” says committee chair and Member of Parliament for Germany’s Social Democratic Party (SPD) Daniela Kolbe. Because even if this is not the only measure of quality of life, unemployment is seen as one of the biggest obstacles to happiness.

by Janet Schayan

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