Subjective Wellbeing (SWB)

Subjective wellbeing (SWB) refers to how individuals evaluate their own lives, including their happiness, life satisfaction, and sense of purpose. Unlike traditional economic indicators such as Gross Domestic Product (GDP), which focus on material output, SWB centres on quality of life and lived experience.

While GDP measures a nation’s economic activity, SWB asks a different question: how do people actually feel about their lives? It provides a more holistic view of national progress by recognising that a thriving society is not just economically successful, but also one where people experience high levels of wellbeing.

The growing use of SWB reflects a shift in policymaking, from focusing purely on fiscal outcomes to valuing wellbeing as a core objective in its own right.

Between 2014 and 2024, the UK government made significant progress in integrating subjective wellbeing (SWB) into policymaking. The shift began after the 2008 financial crisis, when then-Prime Minister David Cameron publicly supported the need to measure national wellbeing. In response, the Office for National Statistics (ONS) began collecting SWB data in 2011.

A major milestone came in 2013, when HM Treasury’s Green Book formally recognised SWB as a valid input for cost-benefit analysis (CBA). This was further strengthened by the 2022 supplementary guidance, which introduced the Wellbeing-Adjusted Life Year (WELLBY) as a standard way to monetise changes in wellbeing.

Since then, government departments such as the Department for Work and Pensions (DWP) and the Department for Transport (DfT) have applied SWB evidence in areas like employment services and infrastructure planning. Meanwhile, the What Works Centre for Wellbeing (active from 2014 to 2024) played a crucial role in building credibility for SWB data and making it accessible for policy use.

Today, SWB evidence is used to monitor societal progress, support the case for new policy interventions, and inform detailed policy analysis. Tools like the Wellbeing Valuation (WV) method and WELLBY have helped translate subjective wellbeing into monetary terms, allowing for direct comparisons with more traditional economic metrics.

Subjective wellbeing (SWB) can be measured in several ways, depending on the aspect of wellbeing being assessed. Philosophers typically group wellbeing into three broad categories:

• Mental state accounts (i.e. SWB): Based on how people feel about their lives

• Preference satisfaction: Focused on whether people get what they want

• Objective lists: Concerned with the fulfilment of basic needs and rights

For policy purposes, the focus is on subjective wellbeing — people’s own assessments of their lives. SWB can be measured through four main lenses:

• Evaluative SWB: Overall judgments about life satisfaction at a given moment

• Experience SWB: Feelings experienced in the moment or over a short period (e.g. stress, happiness)

• Hedonic SWB: Emotions like worry, anger, stress, or pleasure

• Eudemonic SWB: A sense of meaning, purpose, or autonomy in life

In the UK, the Office for National Statistics (ONS) captures SWB using four core questions, known as the ONS4. These are:

1. “Overall, how satisfied are you with your life nowadays?”

2. “To what extent do you feel that the things you do in your life are worthwhile?”

3. “How happy did you feel yesterday?”

4. “How anxious did you feel yesterday?”

These questions are widely used in government and academic surveys. Evaluative measures like life satisfaction offer a broad, stable view of wellbeing over time, while experience-based questions give a more nuanced picture of daily emotional states. Together, they provide a rounded view of how people are really doing — and how policy might help improve their lives.

Over the past decade, subjective wellbeing (SWB) evidence has been successfully applied across a wide range of UK policy areas. Key examples include:

• Transport
  The Department for Transport (DfT) has been a leader in applying SWB data, using it in cost-benefit analyses for major infrastructure projects like the M60 Manchester Northwest Quadrant and Heathrow Airport expansion. SWB metrics have also been used to explore how access to transport affects quality of life.

• Infrastructure, Housing and Place
  SWB underpins the Levelling Up strategy and tools like the UK Shared Prosperity Fund (UKSPF) Local Survey Tool, which focuses on measuring resident wellbeing. Research has also revealed stark differences in wellbeing across housing tenures, shaping housing policy discussions.

• Environment
  SWB evidence is central to long-term plans such as the 25 Year Environment Plan and the Environment Agency’s wellbeing-focused reporting. The Canal & Rivers Trust has monetised the wellbeing benefits of waterway use, using this data in funding negotiations.

• Health
  Wellbeing data has highlighted the importance of mental health and helped shape national strategies, such as the Five Steps to Mental Wellbeing. SWB metrics were also used to monitor public health during the Covid-19 pandemic, directly informing Cabinet Office planning.

• Community
  Evidence on loneliness has played a pivotal role in policies like the UK Government’s Loneliness Strategy, helping to prioritise interventions that strengthen social connections.

• Consumer Finances
  Regulators like Ofcom and the Financial Conduct Authority (FCA) have used SWB metrics to explore issues such as online safety and personal debt. The FCA now includes Wellbeing Valuation in its cost-benefit analysis guidance.

• Sport
  Research on the relationship between physical activity and wellbeing has supported funding bids and been used in Spending Reviews by DCMS and Sport England.

• Children and Young People
  SWB has shaped education and youth wellbeing policy, including the Children’s Wellbeing and Schools Bill and the BeeWell programme.

• Labour Market
  Used to evaluate Active Labour Market Policies such as JOBS II and the Youth Offer.

• Workplace Wellbeing
  Applied in civil service surveys and tools, influencing staff wellbeing strategies across departments.

• Culture and Heritage
  Informed the Wellbeing and Heritage Strategy (2022–2025) from Historic England and creative health initiatives within Integrated Care Systems.

• Faith and Community Groups
  Some studies have explored the wellbeing role of community organisations, including churches, particularly in social connection and belonging.

These examples show that SWB is not just a theoretical tool, it is already shaping policy and funding decisions across government.

The Wellbeing Valuation (WV) method is a technique used in UK policymaking to translate changes in subjective wellbeing (SWB) into monetary values. It works by comparing two things:

1. The impact of a specific policy outcome on SWB

2. The impact of income or money on SWB

By calculating the ratio between these two effects, policymakers can estimate the monetary value of a wellbeing change — making it possible to include SWB in cost-benefit analysis (CBA), in line with HM Treasury’s Green Book.

To make this process more consistent and accessible, the Wellbeing-Adjusted Life Year (WELLBY) was introduced in the 2022 supplementary Green Book guidance. The WELLBY provides a standardised monetary value for a one-point change in life satisfaction, allowing analysts to quickly estimate and compare the value of wellbeing impacts across different policies.

Together, WV and WELLBY help government departments assess not just economic outcomes, but which policies deliver the greatest overall value to society, based on how they actually improve people’s lives.

Despite its growing influence, several technical challenges continue to limit the broader adoption of subjective wellbeing (SWB) evidence in UK policymaking:

• Causality
  Most SWB studies are based on correlations rather than direct cause-and-effect. This makes it difficult to attribute changes in wellbeing to specific policies with confidence. Applying general findings to particular interventions can risk oversimplification or misinterpretation.

• Data Limitations
  Many national surveys do not offer the level of detail needed to assess the impact of smaller or more targeted programmes. This lack of granularity can hinder meaningful evaluation at the local or organisational level.

• Insensitivity of Metrics
  Common SWB indicators like life satisfaction may not capture marginal or short-term effects, such as the impact of a single event or one-off intervention. This can limit their usefulness in fine-grained appraisals or when measuring small-scale policy impacts.

• Double Counting and Interpretation Challenges
  Using the Wellbeing Valuation (WV) or WELLBY to monetise wellbeing changes can be unfamiliar territory for many policymakers. There’s also a risk of double-counting when SWB values are added to other monetised benefits in cost-benefit analysis. Additionally, some struggle to interpret what these non-cashable values really mean in practical or funding terms.

These barriers don’t negate the value of SWB — but they do highlight the need for better tools, clearer guidance, and broader understanding within the policymaking community.

Beyond technical issues, several institutional and political challenges continue to limit the wider adoption of subjective wellbeing (SWB) in UK policy:

• Lack of Leadership and Resources
  There is currently no central government unit dedicated to wellbeing. As a result, SWB-related work tends to happen informally, inconsistently, and often without adequate resourcing. This limits its ability to become embedded in mainstream policy processes.

• Confusion with Health Metrics
  SWB is sometimes mistaken for or bundled in with physical and mental health data. This confusion can obscure its distinct value as a broader quality-of-life measure, and reduce its influence in policy areas outside health.

• Low Awareness and Selective Use
  Awareness of SWB tools and methods remains uneven across departments. In some cases, evidence is only used when it aligns with existing priorities, rather than being applied consistently as part of robust evaluation or decision-making. This selective uptake undermines institutional trust and limits long-term impact.

• Tensions with Economic Growth Agendas
  There is often a perceived conflict between wellbeing-oriented policies and growth-focused strategies. However, research shows that higher levels of wellbeing are linked to increased productivity, creativity, and lower absenteeism. Far from being at odds, SWB can be a powerful enabler of inclusive, sustainable growth.

For SWB to gain traction across government, these institutional barriers must be addressed alongside the technical ones, through leadership, capacity building, and cultural change within the policymaking system.

Subjective wellbeing (SWB) has a reciprocal relationship with economic growth and productivity. While economic policy has traditionally prioritised growth as the primary goal, mounting evidence shows that wellbeing is not just a social good, it’s also a driver of economic performance.

People with higher levels of wellbeing are typically more productive, creative, and engaged at work. In contrast, poor wellbeing is strongly associated with absenteeism and presenteeism, where employees are either off work or present but not functioning at full capacity. Both come with significant economic costs for employers and society.

This means that policies which improve SWB can also boost workforce performance and support a more resilient, inclusive, and equitable economy. Rather than treating wellbeing and growth as competing priorities, this perspective calls for a balanced policy approach, one that values both economic progress and the quality of people’s lives. In short, it’s time to move beyond a “growth at all costs” mindset.