OECD Tries To Measure Human Cost Of Economic Crisis: Conclusion Is Pessimistic

OECD said on Monday the global economy was showing signs of fresh fatigue and that major indicators point to a downturn in major advanced and emerging economies. Reuters

The international Organization for Economic Co-operation and Development (OECD), which promotes economic and social well-being, says the recent economic crisis undermined global trust in government as jobs were slashed and incomes fell.

The OECD's "How's Life?" report found that subjective well-being fell in countries hit hard by the global economic crisis. From 2007 to 2012, average life satisfaction fell over 20 percent for Greeks, 12 percent for Spaniards, and 10 percent for Italians.

Germany, Israel, Russia, Mexico, and Sweden became slightly happier countries, bizarrely enough. The OECD’s membership is made up mostly of advanced Western economies.

European nations which were hit especially hard, like Portugal and some southern European economies, also lost faith in government. There was a 10 percent decline in residents from those countries claiming to trust national governments, over five years.

In the 34 OECD countries, less than half of people surveyed said they trusted their governments, the lowest level recorded since 2006. In places like Ireland and Greece, less than 1 in 3 citizens have confidence in their political leaders, said the report.

Poverty, inequality, and discouraged or inactive workers all increased thanks to the crisis, the reportfound. Stress and work-life conflicts became more common. There were 15 million more unemployed people in the OECD countries after the crisis.

“The full consequences of the crisis will not be known for many years,” says an OECD narrator in avideo accompanying the report.

“Understanding how the lives of people have been affected…requires looking well beyond the impact of the crisis on economic production and financial markets,” wrote the organization’s chief statistician Martine Durand in a blog post.

The report is based on 11 objective and subjective indicators, like housing, income, civic engagement and work-life balance.

The otherwise grim assessment notes, however, that more people relied on personal and family networks, an indication of a “solidarity” which emerged from the crisis.

The OECD added that it had “developed a personalized Better Life index, to help individuals prioritize what matters most to them.”

Earlier in October, the OECD warned that long term joblessness in rich countries had risen. Crisis-caused unemployment means that people aren’t developing work skills needed for the future, the OECD warned in a video.

In the past, the OECD has worked to measure well-being outside of traditional metrics like gross domestic product.