The Happiest Countries in the World

 Denmark’s residents are the most satisfied with their lives, according to the Better Life Index released Monday. According to the study, published annually by the Organization for Economic Co-operation and Development (OECD), the United States failed to crack the top 10 for the fifth consecutive year.

The Better Life Index rates the 34 OECD member nations, as well as Brazil and the Russian Federation, on 22 variables that contribute to overall well-being, including income, education, housing, health, and life satisfaction. 24/7 Wall St. reviewed the 10 countries with the highest life satisfaction score.

Click here to see the happiest countries in the world.

A healthy job market is one of the most important factors contributing to higher life evaluations. Employment rates — the percentage of the working-age population that is employed — were higher in each of the 10 countries with the highest life satisfaction score than the average employment rate for the countries reviewed.

Conversely, countries with relatively unhealthy job markets had lower life satisfaction scores. Unemployment rates were above 8.5% in seven of the 10 least happy countries, while they were lower than 7% in all but two of the happiest countries.

Healthy labor markets not only help promote job security, but also they can contribute to workers’ mental health. Romina Boarini, head of well-being and progress measurement in the OECD’s statistics division, noted that, “unemployment and fear of job loss are detrimental to [a worker’s] mental health.”

Feeling connected to one’s community is another factor in a country’s happiness. In all but one of the happiest countries, at least 90% of respondents reported having a quality support network that they could rely on in times of need. “People are social creatures and get pleasure from spending time with others,” Boarini said.

Good personal health, too, can contribute to a person’s happiness. In New Zealand, tied for the seventh happiest country, 90% of people surveyed considered themselves in good health, the highest proportion of all countries reviewed. Additionally, in all but one of the happiest countries, more than 70% of respondents said they were in good health, all higher than the 36 country average of 68% of people in countries reviewed.

In the United States, life satisfaction rebounded after two years of falling in the rankings, largely due to the country’s improving labor market. Despite the recession erasing a majority of wealth in the country, households had an average net worth of $146,000, by far the most among countries reviewed. Boarini warned that U.S. life satisfaction may be misleading, however, as the data are based on a small sample. In previous years, lower life satisfaction in the U.S. was attributed to income inequality. “We do know the more unequally the income is distributed, the lower the life satisfaction.” In fact, the Gini coefficient, a measure of income inequality, has worsened in the U.S. in recent years. The U.S. still has one of the worst Gini coefficients in the OECD.

To determine the happiest countries in the world, 24/7 Wall St. reviewed the countries that received the highest life satisfaction scores from the Organization for Economic Cooperation and Development’s (OECD) Better Life Index. In addition to the 34 member countries, the OECD included Brazil and Russia. The OECD rated countries on eleven categories: housing, income, jobs, community, education, environment, civic engagement, health, safety, work-life balance, and life satisfaction. We used the life satisfaction index for the ranking. Additionally, we examined unemployment rates for 2013 from the International Monetary Fund.

These are the happiest countries in the world.

10. New Zealand
> Life satisfaction score: 7.3 (tied-7th highest)
> Self-reported good health: 90.0% (the highest)
> Pct. with quality support network: 94.0% (tied-7th highest)
> Disposable income: $23,815 (17th lowest)
> Life expectancy: 81.5 years (tied-10th highest)

New Zealand tied for the world’s seventh happiest country mostly due to the good health of its residents. Nine out of every 10 New Zealanders surveyed reported being in good health, the highest share of all countries reviewed and well above the 68% of residents who said they were in good health across countries reviewed. Not only are Kiwis healthy, but they are also employed. Approximately 73% of residents were employed as of 2013, higher than the 65% of residents among countries reviewed. Additionally, less than 1% of the country’s labor force had been unemployed for more than a year as of 2013, more than three times lower than the average jobless rate among countries reviewed.

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9. Netherlands
> Life satisfaction score: 7.3 (tied-7th highest)
> Self-reported good health: 76.0% (10th highest)
> Pct. with quality support network: 90.0% (16th highest)
> Disposable income: $27,888 (13th highest)
> Life expectancy: 81.2 years (15th highest)

Economic security is one factor that can contribute to a country’s happiness. While 65% of the labor force was employed across surveyed countries, 74% of the Netherlands’ workforce was employed, the fourth highest rate. And while strong household finances do not always correlate with high levels of happiness, the net worth of Dutch households was nearly $78,000 as of 2012, the fifth highest level among countries reviewed.

8. Canada
> Life satisfaction score: 7.3 (tied-7th highest)
> Self-reported good health: 89.0% (2nd highest)
> Pct. with quality support network: 92.0% (tied-11th highest)
> Disposable income: $29,365 (8th highest)
> Life expectancy: 81.5 years (tied-10th highest)

Nearly 90% of Canadians surveyed self-reported high levels of health in 2013, the second highest share in the OECD. High levels of happiness may also stem from strong community engagement. When asked if they had friends or relatives to turn to when they were in trouble, 92% of Canadians responded positively. Together, happiness and social cohesion may help reduce the number of Canadians who are victims of assault. At just 1.3 assaults per 100,000 residents, Canada’s assault rate was three times lower than the OECD average rate, by far the lowest out of all countries reviewed.

7. Australia
> Life satisfaction score: 7.3 (tied-7th highest)
> Self-reported good health: 85.0% (4th highest)
> Pct. with quality support network: 92.0% (tied-11th highest)
> Disposable income: $31,588 (5th highest)
> Life expectancy: 82.1 years (6th highest)

Feeling connected to the people around you is one indicator of a happy country. More than 90% of Australians responded they had a strong network of friends and family. Another measure of social cohesion, civic engagement, was also particularly strong in Australia. In the most recent election, 93% of voter-aged Aussies cast a ballot, by far the highest rate in the OECD. Voting has been compulsory in Australia since 1924, and failing to vote in some cases results in a fine. Australian workers enjoyed both a high degree of job security and high salaries. Annual personal earnings averaged more than $50,000, more than $14,000 above the OECD average.

6. Norway
> Life satisfaction score: 7.4 (tied-4th highest)
> Self-reported good health: 76.0% (10th highest)
> Pct. with quality support network: 94.0% (tied-7th highest)
> Disposable income: $33,492 (3rd highest)
> Life expectancy: 81.5 years (tied-10th highest)

Norway’s unemployment rate was just 3.5% last year, significantly lower than the 36-country average unemployment rate of 8.1%. Working Norwegians were also well paid. Full-time Norwegian workers earned $50,282 annually on average, among the highest levels compared to other surveyed countries. As with many other countries that enjoy high levels of happiness, Norway’s air and water were assessed as some of the best in the world. As many as 94% of respondents said they were satisfied with the quality of their water, nearly the most among countries reviewed.

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5. Israel
> Life satisfaction score: 7.4 (tied-4th highest)
> Self-reported good health: 80.0% (8th highest)
> Pct. with quality support network: 87.0% (11th lowest)
> Disposable income: $22,104 (15th lowest)
> Life expectancy: 81.8 years (8th highest)

By many measures, Israel is an outlier as one of the happiest countries in the world. For example, with the exception of Israel, residents in every country with a high level of life satisfaction reported having a strong network of friends or family. In Israel, only 87% of respondents said they had a strong sense of community, 26th in this measure. Perhaps because of its ongoing conflict with the Palestinians, Israel ranked as one of the least safe countries among countries reviewed, with 6.4% of the population reporting having experienced an assault in the past 12 months. Nevertheless, 80% of respondents reported being in good health, one of the higher rates among countries measured by the OECD.

4. Finland
> Life satisfaction score: 7.4 (tied-4th highest)
> Self-reported good health: 65.0% (12th highest)
> Pct. with quality support network: 95.0% (4th highest)
> Disposable income: $27,927 (12th highest)
> Life expectancy: 80.7 years (17th lowest)

A sense of community is important to an overall sense of well-being. Finland ranked fourth overall in the OECD survey both in life satisfaction and the proportion of respondents who said they had a good support network. Among countries reviewed, 88% of respondents said they had friends and family they could rely on compared to 95% of Finns. Strong education systems can also buoy citizen’s happiness. In 2012, an average student in a Finnish school had the third highest PISA score, an international standardized test. The country also ranked well in measures such as long-term unemployment and work-life balance.

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3. Switzerland
> Life satisfaction score: 7.5 (tied-the highest)
> Self-reported good health: 81.0% (6th highest)
> Pct. with quality support network: 96.0% (tied-the highest)
> Disposable income: $33,491 (4th highest)
> Life expectancy: 82.8 years (3rd highest)

The Swiss are one of the wealthiest populations in the OECD, with net household wealth averaging $108,823, nearly $18,000 greater than the 36-country average. The small Central European nation also had one of the healthiest job markets with 80% of the working-age population employed. This was the second highest figure of countries reviewed, which, on average, had 65% of the adult population employed. Switzerland also tied Iceland for having the highest proportion of residents stating they felt a strong sense of community. It also had one of the lowest homicide rates, at just 0.5 per 100,000 residents, which was one-eighth of the OECD figure.

2. Iceland
> Life satisfaction score: 7.5 (tied-the highest)
> Self-reported good health: 77.0% (9th highest)
> Pct. with quality support network: 96.0% (tied-the highest)
> Disposable income: $23,965 (18th highest)
> Life expectancy: 83.0 years (2nd highest)

Nearly every country with a high level of life satisfaction reported having a strong sense of community. Icelanders, which reported the highest rate of life satisfaction in the OECD, also were the most likely to have friends or family they could rely on. Low assault rates also make Iceland one of the safest countries, which generally improves trust and social cohesion in an area. It also tied with Japan, Denmark, and the UK for the lowest homicide rate of countries reviewed at just 0.3 per 100,000 residents. Iceland had the highest water quality among the 36 countries measured, with just 3% of the people surveyed reporting poor water quality compared to 19% across the OECD.

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1. Denmark
> Life satisfaction score: 7.5 (tied-the highest)
> Self-reported good health: 72.0% (15th highest)
> Pct. with quality support network: 95.0% (4th highest)
> Disposable income: $26,491 (15th highest)
> Life expectancy: 80.1 years (12th lowest)

While having a job often helps contribute to happiness by creating a stable financial environment for families and individuals, balancing work with leisure can also be critical to finding happiness. In Denmark, 73% of the workforce was employed, higher than the OECD average employment rate. Perhaps more important, though, the Danes still found time to devote more than 16 hours each day to leisure and personal care activities, which include sleeping, socializing, and watching television. This was the most time devoted to such activities among countries reviewed. As in other countries reporting high levels of happiness, as many as 95% of Danish respondents had a quality support network, the fourth highest proportion among countries measured by the OECD. Denmark residents are also well educated, having spent an average of 19.4 years in school, the third highest among countries reviewed.