Growth = Happiness?

On 15 May, Spaniards were called to invade the streets by the group Democratia Real Ya (A True Democracy, Now) showing Spain's growing dissatisfaction with the current political and financial system and by demonstrating their level of "fed-upness" with persisting high levels of unemployment (21,1% total, 44,6% for those under 25 years of age). This is a major theme of discussion all over Europe and in other parts of the developed world, but it's also an issue of great importance to the majority of young, talented and extremely qualified expatriate professionals that I speak to here in Hanoi.

If we take the example of Spain, nearly 45% of the under 25 years of age are still searching for employment despite a large majority of them holding a Masters degree, some professional experience and a couple of languages under their belt. When they do find a job, oftentimes their salaries are so low that they’re frequently forced to live with their parents. Although Spain’s unemployment rates are shockingly high, most other European nations aren’t much better off. European economies have been stagnating for some time while the United States seem to follow suite; but what about Asia?

Asia is not only very young, but most countries in the region are experiencing high GDP growth rates, have almost half their populations under 30 years of age and are all in the pursuit of growth and wealth. A big factor for stability in these countries is the relative freedom for entrepreneurship. In the case of Vietnam, every family seems to run an informal business that usually occurs at their doorstep: food stalls, CD and clothing shops, kiosks, liquor stores, handicraft boutiques and many others are an integrative part of almost every Vietnamese’s household. Not all are successful, but a few do breakthrough allowing them to expand and sometimes even begin a chain. It's the renaissance of the “American dream” Asian-style.

However, growth is not eternal and hardly sustainable in the long term, particularly for those countries that have already experienced a major boom. The Chinese government for example, is well aware of the risks of a future dip in growth and has decided to start launching a tactic to move the population’s priorities slowly away from wealth and consumerism to happiness. During this year’s plenary meeting for the development of the 12^th five-year plan, Chinese legislative and political bodies focused more on “happiness” versus “GDP growth”.

Vietnam will certainly face a similar dilemma down the road. Currently, one million new jobs are needed a year to maintain stable employment rates. For the time being, the government is managing this fairly well given Vietnam's comparative advantage over its neighbours with a generally qualified but cheap workforce. Nevertheless, the standard of living is growing and Vietnam has been achieving incredible results in poverty reduction; so good that it not only might achieve all the United Nations' Millennium Development Goals by 2015 but it has already silently exited the low-income country category joining the more prestigious Club of the "middle-incomes". But not everything is as rosy as statistics like to believe. The gap between the have and have not's is growing at a vertiginous speed, particularly visible through the bold and brassy cat walks of Bentleys, Porsches, Rolls Royces, Aston Martins and Ferraris.

China is increasingly aware that happiness is not directly related to the accumulation of wealth and its subsequent consumerist frenzy. Conversely, Spain is aware that without enough growth, happiness is automatically eclipsed by the lack of employment. The balance between the pursuit of happiness and the provision of a sufficient amount of jobs to occupy the population is not only extremely complex but also fragile. European governments are struggling to find a solution as the tensions continue to grow, but it will be interesting to see how China proceeds to influence and teach its population to be happy even without the latest electronic gadget, Louis Vuitton handbag or Lamborghini.

Maybe the Ying and the Yang will finally reconcile after years of separation, re-establishing their long lost equilibrium. Depending on the "happiness" campaign's results, Vietnam might want to consider adopting some similar measures soon and Europe might (for once) need to take notes.