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QUALITY OF LIFE

Why does Norway appear to be less happy than the other Nordics?

Every year Nordic countries top the table of the happiest places on Earth in the World Happiness Report. However, in recent years Norway has been ranked the least happy among the Nordics.

Pictured is a person in Ålesund.
Norway has been ranked as the least happy Nordic country for a number of years. Pictured is a person in Ålesund.Photo by Robert Noreiko on Unsplash

Norway has been ranked the 7th happiest country on the world, an honour that pretty much every country below it in the World Happiness Report would be happy to claim.

However, the country appears to be on a downward trajectory when it comes to happiness, despite the country priding itself on its welfare state, work-life balance, and overall quality of life.

The UN Sustainable Development Network has been publishing the World Happiness Report (WHR) every year since 2012.

Approximately 1,000 people from each country participate in the survey annually and are asked to evaluate various aspects of their quality of life.

On a scale of 1 to 10, Norway scored 7.302. Finland, the happiest country in the world for 2024, had a score of 7.741. Denmark (7.583), Iceland (7.525), and Sweden (7.344) were ranked the second, third and fourth happiest countries in the world.

The Norwegian Institute of Public Health (NIPH) publishes annual reports on happiness in Norway which coincide with the release of the World Happiness Report.

The NIPH said in its report that the satisfaction with life and factors that affect the overall quality of life had slipped in Norway over the past five years.

The decline had been noted across a number of different demographics, according to the NIPH.

It pointed to factors such as tighter finances, increasing inequality, war and the aftermath of the pandemic.

The gap in quality of life was greatest between those with money worries and those with healthy finances.

The Norsk Monitor quality of life survey also pointed to some trends within in Norway. It said that a lower satisfaction in Norway may be related to a bleaker outlook for the future among young people.

This outlook was due to concerns over finances, working life and sustainability. This has occurred despite a relatively steady economy.

One reason for this could be most people getting used to improved living conditions, with their expectations rising in line with the improvements. Another factor could be social comparison, the growing inequality in Norway could cause those with less to want more.

And finally, the NIPH pointed to something called “diminishing marginal utility”. The example used is a fifth piece of cake being less satisfying than the first.

Happiness researcher at the NIPH, Ragnhild Bang Nes, said that two factors could explain why Finns were happier than Norwegians.

One factor would be Finland having lower levels of inequality than Norway, she told the science publication Forskning.no. The other factor was lower expectations. 

However, there are factors to suggest that the other Nordics are not inherently happier than Norway.

The reason for this is the confidence in the happiness report numbers. The figures place a 95 percent confidence in Norway being between the 4th and 7th happiest countries in the world. This means that Norway’s happiness would be interchangeable or comparable with Sweden which also had a 95 percent confidence ranking of 4th to 7th.

Denmark and Iceland would also be interchangeable, but out of Norway’s reach, whereas the confidence range for Finland is just one.

Is there anything that can be done to make Norway a happier country?

Speaking to broadcaster TV 2 about the 2024 results, Bang Nes said that quality of life could be considered a political choice.

“We must work both politically and structurally with a good quality of life and make it possible for people to experience security,” she said.

Redistribution of wealth, access to work and education, and social inclusion where political aims which could boost happiness overall.

“One of the most important things for the quality of life in Norway is precisely this, having good relationships, and not experiencing discrimination,” the researcher said.

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MONEY

EXPLAINED: How wealthy is the ‘average’ Norwegian? 

Norway is known for its high wages and stable economy. New figures have revealed the wealth of the average resident in the Nordic country. 

EXPLAINED: How wealthy is the 'average' Norwegian? 

High salaries go hand in hand with the high cost of living in conversations about Norway.

However, other factors, such as high homeownership rates, indicate that there is plenty of disposable income for locals to save and invest in their futures. 

Previous studies have also suggested that Norwegians are the seventh wealthiest nationals in the world

Norway’s national data agency, Statistics Norway, has compiled its own set of figures indicating that the average Norwegian household has a net wealth of around 3.8 million kroner. 

Net wealth accounts for everything a person owns, including property, stocks, or cash, minus any debts or liabilities. 

The vast majority of this wealth was derived from the estimated value of property. This alone gives the average Norwegian an estimated wealth of 3.74 million kroner. 

READ ALSO: How much does an apartment in Norway cost?

The value of second homes was included, which skewed things as only around 10 percent of households owned a secondary residence. 

The average price of a home in Norway was 4.5 million kroner in March of this year, and house prices have increased substantially in recent years. 

Savings, cash, stocks and other capital accounted for 1.72 million kroner, giving Norwegians an average wealth of 5.46 million kroner. Average debts of 1.68 million kroner gave Norwegians an average net wealth of 3.8 million kroner.  

The figures from Statistics Norway were obtained using figures from tax returns for 2022, which were submitted in 2023.  

Those aged between 67 and 79 years old were the wealthiest generation in Norway on average. This is partly because they have more capital than most other groups and more expensive property. 

However, the most significant factor is the lower levels of debt. They had half the debt of the next richest group, those aged between 55 and 69. 

Younger age groups weren’t as wealthier as they had much higher debts and lower capital. 

Still, Norway’s wealthiest individuals significantly boosted the average. When using the median, the average Norwegian household had a net wealth of just under 2 million kroner. 

When the median was applied to capital, the figure was 339,300 kroner compared to the average of 1.76 million kroner. 

The large difference in capital was attributed to Norway’s wealthiest individuals significantly pulling up the average. 

“This is mainly due to large fortunes in shares and securities, where a few own very much. Shares and other securities and share savings accounts are assets with a median value equal to zero, which indicates that these are not important asset items for most households,” the report said. 

Money kept in the bank was still important for most residents of Norway, though. The median value of bank deposits in Norway was 215,000 kroner, compared to the average of 600,000. 

The gulf between the average value of property owned and the median was roughly 500,000, with the median being 3.25 million kroner. 

Furthermore, Norway’s median debt level was around 860,000 kroner compared to the average of 1.67 million kroner. Around 85 percent of Norwegian households were in some form of debt. 

Significant differences also exist between Norway’s wealthiest and poorest residents. Residents belonging to the country’s poorest ten percent had an average net wealth of almost minus 1 million kroner. 

Meanwhile, Norway’s wealthiest ten percent had a net wealth of 19 million kroner. The top 50 percent also owned considerably more than the bottom 50 percent. 

“Despite the former comprising 1.27 million households, while the latter comprises approximately 25,000 households, the bottom 50 percent own only 4 percent of the total net worth, while the top 1 percent owned as much as 22.3 percent in 2022,” the report read. 

There was also significant variation in wealth depending on household typeFor example, a single mother or father with a child aged between 6 and 17 had a net wealth of 2.24 million kroner, compared to a couple with children of the same age with an average net wealth of 5.12 million kroner. 

Typically, households with more than one person had more money as more than one wage earner likely lived at the address. 

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