London: In a new index of economic performance developed by think tank Demos and PwC published in a new study, "Good Growth: A Demos and PwC report on economic wellbeing", Norway, Germany and the Netherlands are the top countries to live and work in among major OECD countries.
Norway scores highest based on its low unemployment rate, relatively low average hours worked, low carbon emissions and very high national savings rate (due to its oil revenue fund in particular), which also put it ahead of other Scandinavian countries.
The index measures the kind of economy that matters most to the British public and the UK scores lowest of any major OECD country, bar Spain. Within the UK, the South East, South West and Eastern regions have the most attractive economies in which to live and work, with London, the North East and Wales scored lowest. The Good Growth Index includes unemployment, disposable income, work-life balance, health, transport, income inequality and housing, all identified as the priorities of the British people when asked their views about economic success for UK plc.
The index was developed by Demos and PwC through qualitative sessions with the public and wider quantitative public polling involving 3000 people from across the UK in two separate polls. Conjoint analysis was used to determine trade-offs to reveal where the public's priorities lie. The results were then compared with the views of business leaders, policymakers and other opinion formers.
The UK regions that scored best were the East, South East and South West. The lowest scores were reported in the North East, Wales and, particularly, London. London has by far the highest Gross Value Added (nearest equivalent to GNI/GDP measured regionally), but scores relatively poorly on measures such as income inequality, unemployment, health, travel to work times, housing affordability and working hours.
John Hawksworth, chief economist at PwC, said:
"Britain's bumpy road out of recession is understandably causing policymakers and commentators to focus their attention on GDP figures as the key indicator of our economic health. Our research shows that the public takes a wider view of the components of economic success. In the public's eyes, 'good growth' depends on creating jobs what enable their bills to be paid, but also on issues including work-life balance, health, transport, environment, fairness and housing that are seen as critical components of good economic performance.
"We recommend that government tracks not only GDP as a measure of economic success but also a wider measure of 'good growth' to ensure that economic policy decisions are aligned with what citizens say is important. On this wider basis, our analysis suggests the UK is well down the rankings of its OECD peer group, while London also scores poorly relative to other UK regions despite its high average income level."
Kitty Ussher, the report's co-author and an associate of Demos said:
"There is more to people's economic lives than simple prosperity. Much of the wellbeing debate has been focused on nebulous concepts of happiness. This research uses innovative yet statistically robust methods to give a more precise definition of the wider things that people want to see in the work and money side of their lives, and so should be more useful to policymakers.
"It shows that while income and jobs are important, they are by no means the whole picture. In particular it sends a clear message to government that health is an economic policy issue; the public understands that without being well they are unable to work and pay their bills. It also proves that people want to be able to work more efficiently; an extra couple of hours away from the workplace each week has a high value. The government should use the opportunity of our slow recovery from recession to support people to restructure their economic lives in the way we show they want to do."
The full study is here.