Australia is losing its ‘smile’, and young people are the key

The personal wellbeing of young Australians has dipped, while city-dwellers were less likely to be satisfied with personal relationships than those in rural areas. These are among findings of the Australian Unity Wellbeing Index for 2025, released yesterday.

For 25 years, health company Australian Unity and Deakin University have been tracking how Australians feel about their personal lives and life in the nation. Their latest report – the largest to date – surveyed 10,000 Australians and provides detailed insight into wellbeing scores in each electorate.

The survey considered personal wellbeing (satisfaction with areas including personal relationships, health and community connectedness) and national wellbeing (satisfaction with life as a whole and across areas including economy, government and social conditions).

Lead researcher Dr Kate Lycett, a senior research fellow at Deakin University, says the biggest takeaway from the report is that “location matters for wellbeing”.

“We really hope that these findings can drive place-based investments to improve wellbeing in areas that need it.”

One of the starkest divides in findings was between regional and urban areas. Those living in capital cities were far more likely to score higher in terms of national wellbeing compared with those in the regions.

Conversely, city-dwellers scored lower than their rural counterparts for satisfaction with personal relationships, which Lycett suggests may be due to a greater proportion of older residents living rurally and a greater emphasis on community in these areas.

As a whole, national wellbeing rose compared with 2024, while personal wellbeing remained steady.

Lycett posits the survey’s timing – a month after the federal election – may be a reason for this.

“People may have been feeling more optimistic about national life in Australia. We’d also just had two long-awaited interest rate cuts in February and May. So that may have been contributing to people feeling a bit more optimistic about the economy and business and life in Australia.”

How do we measure happiness, and why does it matter?

When we talk about subjective wellbeing, happiness is a synonym one might use.

But as Dr Brock Bastian, a psychology professor at The University of Melbourne points out, happiness – as an individual and variable feeling – is not what economists and researchers talk about when they talk about subjective wellbeing.

Instead, subjective wellbeing looks at overall life satisfaction.

Bastian thinks happiness is a “misnomer” in this context, since it puts the onus of wellbeing on the individual, when wellbeing is influenced by a complex set of factors like access to resources, income, sustainable housing and loneliness.

The end of the U-shaped curve

While overall wellbeing for Australians saw a boost in 2025, young people were the exception.

“This is a trend we’ve seen the last few years. So what we used to see with subjective well-being is what we called the U-shape or the smile,” says Lycett.

Indeed, in previous generations, the highest levels of wellbeing were seen in youth and old age. Now, subjective wellbeing is more linear and increases with age.

A report from February commissioned by the United Nations found this is a global trend, as “the U-shape in wellbeing by age that used to exist in these countries is now gone, replaced by a crisis in wellbeing among the young.”

“Young people are under a lot of strain with housing and cost of living, and they’re worried about the future and climate change,” says Lycett.

“We also know that we’re in the midst of a mental health epidemic that we’re not talking about.”

The health benefits of happiness

Globally, non-communicable diseases, or chronic diseases, killed at least 43 million people in 2021, equivalent to 75 per cent of non-pandemic-related deaths. In Australia, 61 per cent of the population were living with a chronic disease in 2022, which accounted for 90 per cent of all deaths.

A substantive body of literature links happiness, or subjective wellbeing, to a range of positive health outcomes, including longevity, cardiovascular health and immune function.

Those living with chronic disease also experience lower quality of life and wellbeing.

In further evidence, a new study released yesterday, by a group of international researchers looked at data from 123 countries, including Australia. examining exactly how happy we need to be in order to lower our mortality risk from chronic disease.

Data was sourced from Gallup World Poll’s annual life ladder index between 2006 and 2021, which asks people to imagine a ladder, with the lowest rung representing the worst possible life and the highest rung representing the best possible life.

Combining this with data on each country’s non-communicable disease (NCD) mortality rate, researchers found the health benefits of happiness occurred after a threshold of 2.7 (defined as “barely coping”). Once past this, each 1 per cent increase in happiness could lead to a small decrease in risk of death from NCDs.

First author of the study Professor Iulia Iuga, a researcher at 1 Decembrie 1918 University of Alba Iulia in Romania, says research has typically looked at the relationship between happiness and health as a linear, upwards trajectory.

“Our findings show that the association between happiness and health is non-linear, not simply ‘the happier, the healthier’,” she says. “It adds nuance to existing research by demonstrating that subjective wellbeing functions as a population health asset only once a basic threshold of psychosocial and socio-economic conditions has been achieved.”

Importantly, researchers were only able to show correlation between happiness and mortality, and not causation, although Iuga notes this relationship was bidirectional. Happiness scores were also self-reported.

Happiness as a public health resource

Governments have traditionally focused on more obvious markers of physical health that we know contribute to chronic disease, like tobacco and alcohol, poor diet and sedentary behaviour.

But in recent years, more public health initiatives have sought to incorporate wellbeing.

Lycett points to Treasurer Jim Chalmers’ Measuring What Matters wellbeing framework, of which subjective wellbeing is one marker.

But she’d like to see more done.

“I’d love to see it as a complementary measure to Gross Domestic Product (GDP), employment and our traditional economic markers.”

Bastian agrees: “The fact we’re now measuring subjective wellbeing is good, because it’s taken the focus off just GDP.

“We used to think the nation’s wealth and wellbeing was somehow tied up in its GDP... in fact you can have very rich countries with high GDP and low subjective wellbeing.”

Lycett hopes the report’s breakdown by electorate will provide a road map for policymakers. Key areas include standard of living, health and addressing wealth inequities.

“These data can help communities advocate for what they need with their representatives and try and drive change at that level. Overall, I think we need to embed wellbeing into long-term decision-making at both the community, business and government level.”

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