To your well-being - MoneySense

To your well-being


“Hi, how are you?” I get asked that question a few times a day from friends and co-workers. You too? If you’re like me, you automatically shoot back with “good” or “just fine, thanks,” even if your dog just died that morning.

But let’s do away with politeness for a second. How are you? Really?

If you take Canadians as a whole, it’s hard to answer. The economy is in the tank, of course. Unemployment is still rising. Strangely, however, consumer confidence is improving. It’s at its highest level since February 2008. Seems people think the recession is almost over.

The hard numbers don’t bear that out. Which leads to a good question: Should we only rely on economic data like gross domestic product and the unemployment rate to judge how well Canadians are doing?

There’s a new organization out there that says no. The Institute of Wellbeing is calling for a new yardstick to measure how well off we are. Led by former Saskatchewan premier Roy Romanow and affiliated with the University of Waterloo, it’s putting together something called the Canadian Index of Wellbeing. The index is calculated by measuring eight factors including living standards, how involved we are in the community, education, health, and what we do with our time.

Romanow and company say they’ll be able to measure whether our well-being is improving or declining by examining these factors. The usual benchmark, GDP, only measures a country’s income, not how well off its citizens are.

I’m not sure I agree with that assessment (more about that later), but in its first report the Institute of Wellbeing has come out with some insights worth noting.

The most important is that Canadians didn’t benefit much from surges in the economy over the last quarter century. Simply put, wages didn’t keep pace with economic growth. Between 1981 and 2008 real GDP per capita grew by 53%. Personal income grew 36% and personal disposable income 29%.

It’s worth pointing out that some of those wage gains were the result of people working longer hours, not from generous raises. Plus, cuts to government health-care programs mean we’re paying way more ourselves for medical care, not to mention more in taxes. You can read more about these issues here.

Another good point in the report: Good-paying jobs for teens and young adults have been disappearing. In 1980, 31% of people 14 to 24 worked in low-paying jobs. By 2000 that number was 45%. That’s bad news for university grads racking up debt to get an education. If all that awaits them is minimum wage, what’s the point of getting a degree?

Some other findings from this report: We’re living longer and overall we’re wealthier. That’s good. But we’re also getting fatter and, frankly, most of don’t feel as healthy as we used to. We also have fewer close friends.

The Institute of Wellbeing hasn’t issued its index yet, so we’ll have to wait and see whether Canadians’ quality of life has improved since 1994, which is the base year the index will be calculated back to. Still, it will be interesting to see how this new measurement moves up and down as we wind our way through the rest of this recession and into recovery.

My guess: It will probably closely follow GDP. Money may not buy happiness but it does buy security. And Canadians always feel more secure when they have a job, the economy is growing and they have money to buy a house, a car and all the things that go with a nice middle-class lifestyle.

You can’t even count on your health without money these days. Studies show that the higher your household income, the longer you’ll live and the better your health.

So here’s to your well-being. And your bank account.