Remarks by Angel Gurría,
Tuesday, 13 October 2015
Distinguished guests, Ladies and Gentlemen,
It is a pleasure to be in Mexico, in the “perla tapatía”, to present the 3rd edition of one of the most important studies of the OECD: the well-known How's Life?, measuring what matters for better policies and better lives. I would like to congratulate Martine Durand, who is here with us today, and all the team that worked on this study, which is indeed very revealing.
After seven years of crisis, governments around the world are focused on growth, growth and growth. But it is precisely at this time of recovery and reassessment of many of our economic concepts that it becomes even more vital than ever to remind ourselves what we want that growth for. We must recognise that growth is not an end in itself, but a means to increase the well-being of our people and our societies.
At the OECD, asking How’s Life? is at the front and centre of everything we do. We have long known that there is more to life than GDP, and whilst GDP growth is important for a successful economy, it should not be the sole compass to guide us towards success more widely.
What we need is a more sophisticated instrument, some sort of GPS to measure progress understood as the improvement of people's quality of life.
Developing such a GPS has never been more important! A few weeks on from the adoption of the SDGs, and with COP21 bearing down on us, the world is crying out for broader measures of success that truly reflect the impact that our policies and economies are having on the essentials of life: from our well-being to the natural environment.
This edition of How’s Life? provides the latest evidence on well-being across 11 dimensions of life that we’ve been using since 2011 – ranging from objective measures on jobs and earnings, the environment, and work-life balance through to measures of how people feel about their own lives.
This edition of How’s Life? also takes the first steps towards capturing the relational aspects of well-being. It includes new measures of volunteering, as well as trust in others and in public institutions. And it continues our work to capture factors such as social connections, civic engagement, and personal security.
There is a lot in there! But I would like to share three new and striking findings with you.
First, for the first time, we are looking at the well-being of children, not just adults. How’s Life? reveals that children are paying a high price for rising inequality. Presently, 1 in 7 children in the OECD live in poverty, and 1 in 10 live in workless households. From a young age, children in poorer families report worse health, lower life satisfaction, more bullying and weaker relationships with both their peers and their parents.
Let me be more precise: 18% of children in the lowest third on the “family affluence scale” - a standard measure of family wealth - report poor health, compared to 11% in the top third. Whilst 18% of children from poorer households find it difficult to talk to their parents, compared to only 12% of children from wealthier homes.
That is simply not good enough! In the long-term it is neither fair nor economically viable over the long-term to condemn disadvantaged children to worse lives than their richer counterparts. We need to do much more to break this cycle, given that bad outcomes do not just perpetuate across generations, they also have a strong tendency to cumulate across many areas of life.
A second main finding from How’s Life? I would like to share with you highlights the role that volunteering can play in making lives better – both for volunteers and the people they help. Volunteering is an important pillar of civic participation in many OECD countries, and on average 1 in 3 people across the OECD volunteer through an organisation at least once a year.
Our evidence shows that volunteering makes a large contribution to people’s well-being, but this contribution is largely hidden: you won’t find it in our economic statistics. Yet when we put a value on the time that people spend on volunteering in the OECD it amounts to around 2% of GDP!
Yet some people are missing out on all these benefits. Disadvantaged groups, such as the unemployed and those on lower incomes, are more disengaged from our civil society: they have less trust in others and in the institutions that are meant to serve them, and they show lower participation rates in volunteering.
The upshot of this is that all of us miss out, because the economically disadvantaged are excluded from playing a part in shaping and improving our societies. This is a huge missed opportunity. It underscores the fact that building inclusive societies is about a lot more than just addressing income inequalities.
We must also bear in mind that the lost well-being to individuals and the lost benefits to communities do not fall uniformly across countries, which brings me on to the third and final finding I would like to share with you: when it comes to well-being no country has it all.
This edition of How’s Life? shows that the region where you live has an important impact on your opportunities to live well: the differences in well-being within countries can be as large as those between countries.
Take educational attainment. Here in Mexico, 58% of the labour force have completed their upper secondary education in the Federal District, which is as high as the national average for Spain, and higher than that in Portugal. But in Chiapas the figure is 27%, one of the lowest attainment levels of any OECD region. We also see large gaps in employment rates. In Italy the gap between different regions is 33 percentage points – that’s as big as the difference in employment between Greece and Switzerland.
The compelling nature of these findings underlines the importance of broadening our notion of prosperity. Asking How’s Life? brings to the fore that we need to re-think our current growth model: we can no longer afford to pursue growth without a care for who benefits, what effects it has on our natural environment, or how it impacts people’s well-being.
But the story cannot and should not end here. We need to make sure that the compelling findings set out in How’s Life? are translated into policy action.
By bringing well-being statistics into our mainstream analysis, our All on Board for Inclusive Growth initiative, has broken new ground on this front. Using the diagnostic tools of How’s Life? to develop policy recommendations that aim at improving well-being, like promoting better access to high quality education for children from the neediest families, ensuring that they are empowered in all fields of life. Inclusive Growth policies must also focus on improving job quality, not just quantity, and more generally on growth policies that go hand in hand with higher quality of life and well-being.
Ladies and Gentlemen,
They say that what you measure defines what you do. We have done a lot already to improve our measures. But now that we can measure better, we must start to do better.
Asking How’s Life? is just a first step, but it is an absolutely vital one. The 11 dimensions of well-being covered in this report, and the focus on the resources that will sustain them over time, give us a much more rounded picture of how people are faring. It’s time now that governments start to use the evidence to design better policies for better lives!