The Economics of Happiness

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While researching my next book on the future of jobs, I had a revelation. No, God didn’t hand me a Windows tablet. I was blown away by how many articles and websites I found about ‘happiness at work’.

5 Ways to Make Your Boss Love You

7 Steps to a Job That Completes You

10 Tricks to Finding Nirvana in Your Cubicle (The Hindu one, not the rock band)

You’d get more wisdom from a short prison sentence.

Seemingly successful people everywhere are searching for meaning, purpose, or a hug. Our collective emptiness has spawned a $10B industry of experts, coaches, and gurus in yoga pants. That doesn’t include the billions spent on therapy or on keeping one in ten Americans knee-deep in anti-depressants.

So here’s my humble attempt to save you $9.9 Billion – and hours of reading fluffy, feel-good dribble.

My premise? Everything we’ve been sold about happiness is bullshit…and economics proves it. It also points us towards real, meaningful ways to achieve it. Hint: it probably won’t happen at work.

Brace yourselves.

Game of Phones

You might be wondering – why someone who does innovation for a living is about to get medieval on Tony RobbinsThe Secret, and their merry band of happiness fluffers…?

Ah, that’s the dirty little secret.

After finishing all the levels in a video game, the only way to stay interested in playing that game is to crank up the settings from “easy” to “hard.” That’s exactly what happened in real life.

While parts of the world are just getting indoor plumbing, the west’s struggle has shifted from an outie to an innie. From now on, every successful invention, every addictive gadget, every indulgent service must be one of convenience, of leisure. It must make us feel better, validate us, or create an unforgettable experience.

So, happiness is the last thing left to innovate.

And it won’t be easy. Not if we want it to be real – or at least feel like it is.

The 9 Reasons for America’s Happiness Deficit

Below are nine root causes of our happiness deficit. They also leave a trail of Skittles towards real happiness.


1. Survival Accomplished

Basically, we won. Not only can humans eat almost anything on the planet (except their neighbors), most of us no longer have to cook it. In fact, we don’t have to make anything – or know how it’s done. Think of all the things you have – TV, smartphone, couch, car, clothing, butter… What percentage of the people in your life had anything to do with making any of them? I bet it’s close to zero.

Our shift from manufacturing and agriculture to services happened fast. And that change is accelerating. Between outsourcing, automation, 3D printing, and economies of scale, all things that make up our physical world will make and deliver themselves.

So what do we do? Marketing. Or engineering or consulting or financial services. Whatever it is, it won’t require a crossbow or even the slightest hint of muscle tone. We are office workers.

Office work can be brainy or brainless, but never brawny. This transition has been especially hard on the male of our species. Though the human body hasn’t changed in 50,000+ years, CubicleZombie Inc. only wants our brains. And our bodies are staging a quiet rebellion against a world that has no use for them. Unhappiness is just a warning shot, like a Slushy brain freeze.

Depression itself is a byproduct of civilization. Less developed cultures face child mortality, infection, and violent death, but don’t experience depression. An odd reward for our evolutionary victory.

With our days of building shelter and baking biscuits behind us, the burden of finding meaning and purpose is in our hands alone. As I wrote in HBR, we’re not so great at it. So far, our response has been to simulate what we’ve lost.

We have gyms to simulate lost physical activity. Entrepreneurship can trigger our dulled survival instincts. Others cook recreationally – or at least commemorate their eating on Instagram as a vague reminder. Even companies seek to stimulate us in ways that have little to do with our jobs.


Provocative predictions & prescriptions on where innovation, economics & culture will take us. Fearless. Funny.

And office work demands education. It’s boot camp for cuddly cubicle commandos. Education also raises our expectations. It makes us hyper-aware, hyper-analytical, and yes, unhappy when we don’t live up to them.

2. Lumpy Luxuries

US household income is higher than in most other places, but the distribution of wealth has never been lumpier. A whopping 23% of workers are unemployed, underemployed or discouraged. Most don’t have the skills to compete in this white collar utopia. They also don’t have the savings to secure it for their kids. The psychological strain this creates is undisputed.

Americans also spend more hours working than any other developed country, except Israel and Turkey. Though both have better hummus. Our extra hours buy plenty of cheap food, but not the three things most likely to build a viable future. From 1990 to 2008, income went up by 20%, but healthcare, education and housing went up by 155%, 60% and 56% respectively.

As I wrote in Econovation, we have good things in store. Bloated prices and tons of unmet demand have attracted plenty of startups in education, distributed healthcare, and finance. In the next decade, I believe they will serve those alienated by the current system.

3. Crowded but Alone

No culture exalts individuality, independence, and hero worship like the US. That approach has created some revolutionary entrepreneurs and iconic achievements. But these days even when our heroes collaborate, they produce something more like The Avengers – a collective of self-absorbed assholes who prefer to do their own thing, in their own way, for their own reasons. Now imagine more people than ever being able to trade-in their “we” for “me”. That’s exactly what happened.

We’re on our own. Alone. By choice. Men and women started earning enough money to stay single longerPets and roommates replaced spouses. Those who do marry, divorce more often despite evidence that married people live longer. Birth rates in the West plummeted as it became cheaper to buy a yacht than raise a child. Many Americans would rather Kickstart a stranger’s company than pay for diapers and day care. Plus, old age just isn’t as scary in a world where meat arrives on Styrofoam instead of on its own four legs.

Long, child-free lives shift the burden of happiness from family and community to career…and the occasional trip to Jamaica. All our eggs sit in the work basket, hoping they hatch happiness – if we sit on them long enough. Note: The author does not condone sitting on baskets full of eggs.

4. Leisure Time Surplus

People say ‘life is too short’. When it comes to happiness, it might be too long. We have more leisure time than ever.

Figure 1 Source:

Not only are people single and earning more, but life expectancy rocketed from 47 years in 1900 to almost 80 today. That’s like getting an extra year to file your taxes!

Americans are like a new television network. We have hours of programming to fill, but only own the rights to one season of Blossom.

So we need entertainment. We need Facebook. We need cable TV. We need my dumb books and articles to fill our days. If we don’t get them – if we don’t fill our waking hours with something, studies show we get anxious and depressed.

5. Envy on Overdrive

Oh, on Facebook are you? On LinkedIn? Did you know that your old high school acquaintance Jenny just got back from an amazing party? You weren’t invited. Have you heard Jerry, the kiss-ass who made your last job unbearable, just got a big promotion? Or that the girl you took on one date six years ago looks great in a bikini? Sure you do. You know it all. And it’s making you miserable.

We’re connected to more useless, peripheral people than ever. We’ll never see most of them in real life ever again. And prepare to die if you ever need one of them for anything real like a blood transfusion – or a ride to the airport. Still, they consume our time and our thoughts. And the aggregate effect of their carefully curated online personas and seemingly-perfect lives makes us feel like losers. Er, “unhappy”.

6. Disposability

Just like our proliferation of friends, we have an orgy of choices. As Barry Schwartz proves in his terrific book and TED Talk, too much choice makes us miserable. We’re buried under hundreds of unimportant decisions. Which phone? What flight? Which of 250 cereals to choose?

I’ll take it a step further. The sheer abundance of some things breeds disposability in everything. When you had fifteen CD’s, you cherished each one like a family member. Now with 20,000 songs on your computer and millions on Spotify, you’d be fine if Rihanna got trampled by a herd of elephants. She probably wouldn’t come up on shuffle play for another decade. Beyonce better watch her back too.

So if music, books, TV shows, and gadgets are abundant and disposable, are the people who make them disposable too? I’d argue that disposability is contagious. When enough of the things in your life become cheap throwaways, things that shouldn’t be are just collateral damage. They become disposable too. Why work through a tough relationship when there are millions of singles on OKCupid? Why invest in a job, an employee, a friendship, or a home when another one is just a few clicks away?

Maybe if you were making all those decisions, this might actually feel empowering. But more often than not, you’re on the receiving end of other people’s decisions. You are their disposable object.

7. Gratification Acceleration

3f92f76[1]As with choice, the Internet has conditioned us to expect physical things to arrive as quickly as songs and web pages. News used to require a truck and a sweaty guy with peek-a-boo pants. Today we spend over five hours a day digitally. Every website, game and device instantly adapts to our tastes, dreams, and aspirations. The more life digitizes, the more our expectations for all things—digital or not—accelerate.

Companies are scrambling to keep up. Every cuisine in the world gets delivered to our door in 30 minutes. Physical stores can’t compete with Amazon’s warehouses stocked with everything for every need. Even eBay had to find a way to miraculously deliver anything we order in less than an hour. It won’t be long before that hour seems like forever. As Louis CK says in his classic routine, “everything’s amazing and no one is happy”.

8. Lotto Fever

UCLA study showed that in one decade – from 1997 to 2007, fame leapt from #15 to #1 in importance to kids age 9-12. And it’s not just kids. Work looks like a real pain in the ass when everyone seems to achieve money and fame with no discernible skill. We’re bombarded by overnight reality stars, viral videos, and startup billionaires whose companies never earned a penny. And there are countless media outlets and social networks to amplify their good fortune.

The lottery mentality runs deep. And money isn’t the only motivator. Sure, some people will lie on the sidewalk in front of Macy’s waiting for a lawyer to show up. But more are motivated by fame, likes, and shares. This is the new currency for a world running out of important things to do. I’m not sure what powers the Mayor of Shake Shack has, but I’m sure it was a lot easier to get than a nursing degree.

9. Body by Bacon

The easy life has a price. It can be measured in pounds. Or kilos, for Europeans. Obesity rates are through the roof. This is what happens when a species loses its natural predators –and all the activity that goes with it. But obesity takes a toll on individuals and society. It brings higher medical costs, disability rates, and yes depression.

Opportunists abound. Dieting is a $20B industry and 85% of its victims are women. I say victims because dieting never works. It never addresses the root cause – a society no longer built for our bodies – or any body at all. That doesn’t mean we shouldn’t try, but there’s a reason I listed this last.

I am encouraged by the psychological implications of what Google did to reduce employee M&M consumption. I believe this can be scaled to a country level. But I’m not sure we’ll have the appetite for it. Pun intended.

That leaves us with 3 questions…

1) If work can’t deliver happiness, what can we expect from it?

2) Where should we look for happiness?

3) Why did I depress you for like 30 paragraphs?

Here’s the good news – there are answers. Or at least, I have an interesting theory on what it might be.

The bad news is this article is already too long. So I’m going to give you my first answer today and the second next month. (Subscribers to ideafaktory will get it first.)

The third one is for you to decide. I would love to read your thoughts in the comments below.

11 Things Modern Jobs Could Deliver

First, let’s celebrate. Get up and twerk around the office. The fact that you’re reading this makes you a raging evolutionary success, a winner. And if you’re reading this at work, even better. That means chances are slim that you’re also holding a shovel. You have the luxury of choice. There’s freedom baked into your job. Otherwise, you’d be clicking on something far more urgent.

Go ahead and fire your therapist. I’ll wait…

Let’s talk psychology. In sports, in dating, and at work there are always two games being played. There’s the one on the field (or bar or conference room). Then there’s the one in your head. Though jobs are failing our body, they have the capacity to captivate our mind – and sometimes, our imagination. The victories we can expect from office work can be powerful, if somewhat incomplete.

So here is my list of the things you could get from work:

1. Knowledge – One of the perks of automating drudgery (which we’ll do in the next decade) is the freedom to pursue knowledge. Learning is not output and should never be mistaken for it. But it is fuel for mastery. The best kind of knowledge is earned through experience – and our biggest lessons come from mistakes. The best place to make those mistakes? Work. If we view every failure as a lesson, the world becomes a school. But an education is what you make of it.

2. Discipline – Let’s face it, the military draft isn’t coming back. No roughneck is going to yell at you while you do push-ups next to Tom Cruise. We’re on our own. And we’re an undisciplined mess. We want our individuality. We want to yell at Marissa Mayer for not letting us work from home. And we want to stroll in to work at 10am without a single dirty look. What if that’s the worst thing you can do to yourself – turn work into your living room? Just like disposability is contagious, so is discipline. Achieve it in one part of your life and you’ll do the same in others. Show up early and suddenly you’ll have time for the gym, for family, and for that model car you’ve always dreamed of building.

3. Mastery – Mastery is the culmination of experience, knowledge and discipline. It’s a legitimate expectation, but it’s not a right. It must be earned. Think of craftsmen that make perfect belt buckles, bakers who make artful cakes, or London cab drivers who know every nook and cranny of the city. There is something intrinsically compelling about mastery. And masters attract pupils.

4. Pride and Respect – Masters should take pride in their achievements. But pride is silent. It happens on the inside. It’s the satisfaction of knowing you’ve done your absolute best. Pride’s kissing cousin is respect. And she’s a party gal. Respect comes in two flavors. There’s the one you earn from mastery. Then there’s the one that comes with a position of power or working for a big brand. When respect comes from an undeserved promotion, nepotism, or dumb luck, it’s not respect at all. It’s merely an opportunity to earn it.

5. Helpfulness – As I wrote here, people who help others are happiest in their jobs. Teachers, clergy, firefighters. We might not be having kids, but we still have a need to nurture. (Just don’t try burping your employees at the company picnic.) Even though the physical world doesn’t really need us, people still do. Helping, guiding, and coaching others to their dream is still a fundamental satisfier and it’s not going away – even when we 3D print our own bosses.

6. Alignment with Values – Greek philosophers have debated whether the key to life is serving society or maximizing pleasure. I say decide for yourself. The better you know yourself, the easier it will be to align your job with your values. It might not bring happiness, per se. But if you fracking hate fracking, you might want to put down the drill.

7. Independence – Survey after survey shows people value freedom and self-determination. The tools have never been cheaper or more accessible to create your own job, build a business, or work from anywhere there’s internet. As rigged as people might deem the US to be, we have the tools to unrig it ourselves. Liberation is at hand. It won’t solve our bacon problem, but for those with discipline, it could let them wake up near a beach in Panama and go for a run.

8. Income to fund your real happiness – For many, work is a means to an end. Life can be much more satisfying when you have a plan to spend on the things that are truly important to you – good food, family, travel, hobbies, etc. And companies still need skilled masters, even if they don’t knock themselves out working until midnight, climbing someone else’s ladder.

9. Contentment or Satisfaction – Yes, there are some who have achieved happiness at work, but they are not the norm. Neither are 95 year old chain smokers. They won a lottery. If it happens, great. While it won’t make you hop around on Oprah’s couch, contentment is far sturdier than happiness. It’s earned through hard work, sacrifice and a slow trickle of rewards – compliments, promotions, bonuses, and more opportunities for all of the things on this list.

10. Solving a problem – We still have real problems to solve. Most people aren’t doing it in their jobs. Maybe it’s because their jobs are too administrative or “strategic”. Or because their startup is a dumb app. Fact is the white collar world is running out of big problems. And not everyone gets to work on those. Most of us must find pride in solving smaller ones or chase down the big ones in Africa, Asia or the Middle East. The beauty is we’re free to decide.

11. Legacy – I will not be remembered. Probably, neither will you. How do I know that? Steve Jobs will not be remembered. No more than the inventors of the 8-track, the Walkman, air conditioning, or flatscreen TV’s. Yes, they’ll be on Wikipedia, but anyone 10 years old or younger will not care about Steve’s amazing achievements. His technology is already being leapfrogged. But legacy is attainable by all. Not in the historical sense, but in training the next generation, passing on our wisdom, and setting up others to succeed.

Sign up at IdeaFaktory for an early peek at Part 2. Stay tuned. 

Till then…

– – –

[This is a re-post of Steve Faktor’s viral article on LinkedIn.]


Even immigrants are less likely to have depression and mental illness…

Immigrants have fewer mental disorders than U.S.-born Americans. Why?

Immigrants who come to the U.S. are significantly less likely than U.S.-born individuals to have mental health problems, according to a new study published in Psychiatry Research.



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Provocative predictions & prescriptions on where innovation, economics & culture will take us. Fearless. Funny.