By Georgie Hewson, ABC
Australia and New Zealand consistently receive similar rankings in the worldwide Happiness Report, a snapshot of countries' well-being, security and economic health. Photo: 123RF
Australia has pushed New Zealand down a spot to become the 10th happiest country in the world, according to the latest World Happiness Report.
The annual report, conducted in partnership with the United Nations, Gallup World Polls and the Oxford Well-being Research Centre, features experts using responses from people in more than 140 nations to rank the world's "happiest" countries.
This year Australia has climbed up two spots to number 10, which was held by New Zealand last year.
NZ drops place in happiest countries list
Finland is ranked number one for the seventh year in a row.
When compiling the report, researchers take into account factors such as life expectancy, GDP, having someone to count on, a sense of freedom, generosity and perceptions of corruptions.
So how are these countries fairing and how much happier is Australia than its neighbours across the ditch?
Economy plays a role
Auckland-based economist Shamubeel Eaqub says the state of the economy in New Zealand could play a part in New Zealand's drop in ranking.
New Zealand is in its second recession in 18 months after Gross Domestic Product (GDP) fell to 0.1 percent in the December 2023 quarter.
"Perception is right that it [New Zealand] is less prosperous. For example, GPD per capita is 30 percent lower [than in Australia]," he said.
"But [in New Zealand], welfare provisions are more generous and there is perceived lower corruption."
When rankings are broken into two age groups, both countries rank much lower for young people.
For under thirties, Australia drops down to 19 and New Zealand is ranked 27.
Over sixties are better off in both countries.
Well-being is actually higher for over sixties in New Zealand at number 6, outranking Australia at number 9.
Eaqub believes both countries' young people face similar economic challenges, making them less satisfied during the past decade.
"We know that two key issues are front of mind for young people: housing and climate change" he said.
"The idea of progression - that is each generation being better off than the last, is increasingly seen as a false promise.
"On some measures that is true: expected lifetime income from work was highest for those born before 1985 - up to which time each cohort was better off on average than the previous, but this is no longer true."
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He is surprised the gap between the countries isn't greater.
"Australia is a much larger and richer country, but both countries face similar issues for young people, especially around housing, climate change and an uncertain life trajectory compared to previous generations."
Work-life shapes well-being
Associate professor Chris Wright is an expert Work and Organisational Studies at the University of Sydney.
He said quality of working life plays a major role in how people measure their overall happiness.
"I look at Nordic countries and see that happiness is so high. There is a high working-life quality because wages are fairer and more aligned with living costs, there's more flexibility," he said.
Workload, mental health, economic pressures and climate worries are among the issues young New Zealanders report weigh on them. Photo: 123RF
"To give the Aussie government credit, over the past 18 months a series of changes have been made to provide better security for people at work, providing people to with mechanisms to get better wages.
"But New Zealand did put in laws to support people at work and before that came into effect a new government came in and took those laws away."
He said there was room for improvement in both nations.
"While Australia is doing better than New Zealand, both countries have to lift their game."
Happiness is subjective
Life expectancy, social bonds, personal freedom and corruption all influence respondents' self assessments of happiness too.
Dr Tim Sharp is a psychologist and founder of Australia's Happiness Institute.
Dr Sharp believes both countries are doing quite well despite their differences. (File photo) Photo: 123RF
"It's important to state they're not talking about happiness in the way we do on a day-to-day basis," he said.
"What these surveys are really measuring is a much broader and bigger and higher construct, which is things like access to education, transport, healthcare and freedom, security and safety."
Happiness is subjective, he warned, but he believes both counties are doing quite well.
"No one would dispute the fact Australia isn't perfect, but taking [that] into account it's pretty bloody good and most people realise that," he said.
"Some people are doing it very hard, but we're talking about big, global, high level comparisons - we're a lot better off."
He said while Australia might sit above New Zealand for happiness, the margin is quite small.
"Ten and 11 is a difference - I would suggest is meaningless," he said.
- This story was first published by ABC