A New Australian Index Ties Post-School Study To Well-Being

13 Feb 2014

Modeling for the FMLEW (Fairfax Media Lateral Economics Well-being) Index found recently that every higher trade qualification or degree is worth $928,000 in wellbeing.

The index uses a number of indicators to assess changes in national welfare, gives a dollar figure to the formal adult qualifications’ contribution to the well-being of Australia. Australia has 8.25 million adults with a higher trade qualification or degree and Lateral Economics measures that education’s combined well-being value as a hefty $7,656 billion.

The well-being established by post-school qualifications amasses to the whole community, says the author of the index, Dr. Nicholas Gruen.

He said that people who have adult qualifications have more probability of being employed, earn more while being employed, raise their co-workers’ productivity, increase technical and innovation change, and raise profits for employer.

Moreover, at a social level, there are benefits from greater civic engagement, reduced crime rates and increased charity. Dr. Gruen said that the worth of a university degree divulged by the well-being index can be used to compare other academic measure of the worth of postgraduate education.

Studies from World Bank found that ‘intangible’ capital, like the technological progress, collective know-how and other forms of institutional and social capital, is worth many times the value of financial, natural and physical assets combined.

The well-being index takes into account the know-how, national income, the environment, inequality, job satisfaction and health. Hence, it gives a more integrated view of changes in Australia’s welfare than conventional economic measures. The recent index report displayed that, in the September quarter, the collective well-being of Australia decreased by 1.8 per cent which was the first decline of the Index since early last year.

However, in the year to 30^th Sep, well-being increased - much faster than economic growth - by a healthy 7.2 per cent. The Bureau of Statistics figures show a rise of 0.6 per cent in the quarter and 2.5 per cent in the year for gross domestic product.