Scottish Social Attitudes Survey 2011: Core Module - Attitudes to Government, the Economy and Public Services in Scotland

3 Changing Views of the Economy and Living Standards

Introduction

3.1 This chapter summarises trends in:

• Public priorities for Scottish Government action
• Perceptions of the strength of the economy and the general standard of living in Scotland over the last year
• People's satisfaction with their own living standards, job, family and personal lives and
• Whether there are particular groups in Scotland who feel less satisfied with their own living standards compared with the national average.

3.2 As discussed in Chapter One, the 2011 SSA survey took place against a backdrop of ongoing economic austerity and public sector budget restraint. This chapter explores how public opinion has responded to ongoing economic austerity. Do they share the Scottish Government's view that securing economic growth should be its top priority? Have views of the economy and standard of living improved since the recession officially ended? And has people's satisfaction with their own lives - including their standard of living - been affected by the ongoing impacts of recession and public sector public cuts?

Priorities for Scottish Government action

3.3 Since the recession of 2008-2009, people in Scotland have consistently stated that the top Scottish Government priority should be to 'Help the economy to grow faster' (Table 3.1). The proportion stating this should be the government's highest priority in 2011 (36%) was very similar to that in 2010 (37%). Cutting crime has been the next most commonly chosen priority in every year since 2009 (chosen by 17% in 2011), followed by health (16% in 2011) and education (15% in 2011).

Table 3.1: What should be the Scottish Government's* highest priority? (2004-2007, 2009-2011, column %)

	2004	2005	2006	2007	2009	2010	2011
	%	%	%	%	%	%	%
Help the economy to grow faster	16	18	14	16	33	37	36
Cut crime	22	23	24	27	17	18	17
Improve people's health	27	26	24	17	13	15	16
Improve standards of education	17	15	16	12	15	12	15
Improve housing	12	10	12	16	13	9	11
Improve the environment	4	4	6	5	3	3	2
Improve public transport	1	1	2	1	1	1	*
Bases	1637	1549	1594	1508	1482	1495	1197

Base = all respondents
* Prior to 2009, this question asked about the 'Scottish Executive'

Note: not all columns add to exactly 100% due either to rounding or because of small proportions saying either 'don't know' (0.5% in 2011) or giving some other top priority (1.5% in 2011).

Views on Scotland's economy and standards of living: 2007 to 2011

3.4 Since 2009, the balance of public opinion on the recent performance of both Scotland's economy and living standards in general has been negative. This pattern continued in 2011. When asked whether Scotland's economy had got stronger or weaker in the 12 months prior to the survey, a majority (57%) thought it had got weaker. However, this was significantly lower than the 64% who said the same in 2010. The proportion that thought the economy had got stronger correspondingly increased slightly but significantly, from 12% in 2010 to 18% in 2011.

3.5 Figure 3.1 shows the 'net balance' scores for views of both Scotland's economy and general standards of living in the last 12 months^[17]. These are calculated by subtracting the proportion who felt the economy or general standard of living had got weaker or fallen in the last 12 months, from the proportion who said they had got stronger or increased. For example, the 'net balance' score for perceptions of the economy in 2011 is -40 (subtracting the 57.4% of those who thought the economy had got weaker from the 17.9% who thought the economy had got stronger).^[18] Figure 3.1 again indicates that, while the balance of opinion on the recent performance of Scotland's economy remains very negative, views have improved somewhat since 2009, when the UK officially left recession^[19] - the 'net-balance' reduced from -64 in 2009, to -52 in 2010 and -40 in 2011.

Figure 3.1: 'Net balance' scores for views of Scotland's economy and the general standard of living in the last 12 months (2004-2007, 2009-2011)

Base: All respondents
Sample sizes: see Annex B, Table 2

3.6 In contrast, views on the general standard of living in Scotland have moved in the opposite direction: the 'net balance' score fell from -40 in 2010 to -56 in 2011. This reflects a significant increase in the proportion who felt living standards had fallen in the last 12 months, up from 54% in 2010 to 67% in 2011.^[20] It is also striking that most of this increase was in those who felt living standards had fallen 'a lot' - up from 16% in 2010 to 29% in 2011.

3.7 This diversion in the direction of public opinion on the economy and standards of living perhaps reflects the fact that prices were continuing to rise at the time of the 2011 survey, while the economy was growing (albeit very slowly). By September 2011 the Retail Prices Index^[21] had risen to its highest annual rate since 1991, with increases in the price of basics such as food and fuel likely to have a disproportionate impact on those with low incomes. Perhaps views of the economy improved once it was no longer officially in recession, while perceptions of the standard of living continued to be impacted by rising inflation. Public service budget cuts might also be a factor. Perceptions of the general living standard of both those working in the public sector, and those reliant upon it, may have been adversely affected by the reduction, or elimination, of public sector pay rises. At the same time, any reductions or changes to public services may also impact on living standards more widely. Perceptions of the standard of living in Scotland may also be affected by media coverage of unemployment rates^[22] and job losses in both Scotland and the rest of the UK.

People's satisfaction with their own lives

3.8 As the balance of opinion on the recent performance of the economy and living standards in Scotland has been negative since the UK recession of 2008-2009, we might reasonably expect that people's views of their own standard of living would also be negative. Since 2007, SSA has asked people how satisfied they are with their own standard of living on a scale from 0 (extremely dissatisfied) to 10 (extremely satisfied). Perhaps surprisingly, mean satisfaction scores have remained broadly consistent between 2007 and 2011: in 2007 the mean score was 7.79 and in 2011 the mean score was 7.75 (Figure 3.2). This finding is also reflected in the proportion of people who felt they were living comfortably on their present income^[23] which again has not changed over time: 53% in 2007 and 54% in 2011.

3.9 These findings may seem paradoxical given that, as discussed above, people clearly feel that living standards across Scotland are falling. However, they arguably reflect evidence from elsewhere that beyond a minimum threshold, subjective life satisfaction is primarily affected by relative rather than absolute living standards. For example, Layard has argued that once per capita incomes have increased to a comfortable level it is not absolute wealth but relative wealth that affects subjective well-being (Layard, 2006). In other words, once individuals achieve a minimum level of income or standard of living, it is the comparison with what others have that most affects subjective satisfaction and happiness. If it is true that people assess their own standard of living relative to those of others, then even if they believe that living standards have fallen in general across Scotland, they may still be satisfied with their living standards as long as their position in relation to others has not changed. In fact, some people may even feel more satisfied with their own living standards, because they are aware that they have been relatively more fortunate than others in their experience of the economic downturn.

3.10 SSA also includes three further measures of life satisfaction on the same scale of 0 (extremely dissatisfied) to 10 (extremely satisfied): satisfaction with family and personal life, job satisfaction (if employed) and satisfaction with life as a whole. The mean scores for each from 2011 show no significant changes on those for 2010. Similarly, last year's Core module report (Ormston & Reid, 2011) found no significant changes between 2007 and 2010 in any of the four life satisfaction measures.

Figure 3.2: Mean scores for satisfaction with different aspects of life (2007, 2009, 2010 & 2011)

Base: All except those who answered 'don't know' (for job satisfaction, base = all respondents in paid employment, except those who answered 'don't know'). See Annex A, Table A.17 for sample sizes and full results.

Variations in people's views of their own living standards

3.11 The key factors associated with higher or lower levels of subjective wellbeing have been found to be remarkably consistent across different countries (Blanchflower, 2011, Dolan, 2008). Both older and younger people and those educated to degree level consistently record relatively higher levels of satisfaction than those in middle-aged groups and those with low or no educational qualifications. People with disabilities and those who are unemployed show relatively lower levels of life satisfaction. In relation to income, the picture is more complicated: people on the highest incomes in any particular country tend to be the happiest, and yet overall levels of subjective well-being do not increase over time as countries become wealthier (Dolan, P, 2008). This reflects observations above about the greater importance of relative, rather, than absolute wealth in determining subjective wellbeing. Previous SSA reports have identified similar patterns. (Given and Webster, 2008, Ormston, 2010, Ormston & Reid, 2011). Similar factors were again significant in 2011 (Table 3.2).

• Those who were retired were the socio-economic group most satisfied with their standard of living, with a mean score of 8.33. The lowest levels of satisfaction were seen amongst the unemployed (6.65) and those who were permanently sick or disabled (6.48).^[24]
• There were significant differences between those in different income brackets. Those in the top quartile had a mean satisfaction score of 8.28, compared with only 7.06 for those in the bottom income quartile.
• Perhaps unsurprisingly, the most striking differences related to self-rated hardship. Those who felt they were struggling or really struggling on their present income had the lowest mean score of all the groups explored, at 5.82. This compared with a mean score of 8.54 for those who were living really comfortably or comfortably. .
• There was much less differentiation in mean scores by employment sector, although those who worked in the private sector were a little less satisfied than those in either the public or voluntary sectors or those who were self-employed.

3.12 This picture is consistent with previous years. Based on SSA data, particular groups have not become significantly more or less satisfied on average with their standard of living between 2010 and 2011.^[25] The one exception to this was that the mean satisfaction was significantly higher among retired people in 2011 compared with 2010: 8.33 compared with 7.94. This finding is perhaps particularly interesting in the light of recent debates about intergenerational equity, in which some writers have suggested that older age groups may have been less affected by the recent recessions than their younger counterparts.^[26]

Table 3.2: Satisfaction with own standard of living - mean scores by objective and subjective economic factors (2007, 2009-2011)

	2007	2009	2010	2011
ALL	7.79	7.64	7.68	7.75
Employment status
In work/ waiting to take up paid work	7.80	7.70	7.84	7.75
Education/ training scheme	8.20	8.15	7.96	7.67
Unemployed	6.52	6.32	6.15	6.65
Retired	8.20	8.10	7.94	8.33
Permanently sick or disabled	6.53	6.10	6.20	6.48
Looking after the home	7.71	7.82	7.30	7.85
Employment sector
Private	7.73	7.46	7.55	7.55
Public & voluntary sector	7.88	7.80	7.77	7.94
Self-employed	7.73	8.14	7.88	7.96
Household Income
Bottom quartile	7.02	6.75	6.91	7.06
2	7.53	7.27	7.62	7.80
3	7.80	7.75	7.91	7.79
Top quartile	8.37	8.28	8.27	8.28
Self-rated hardship1
Living comfortably	8.51	8.53	8.45	8.54
Neither/Coping	7.37	7.32	7.23	7.38
Finding it difficult/struggling	5.43	5.56	5.84	5.82

1 - NB the wording of this question was changed in 2010, from asking people whether they were living comfortably, coping or finding it difficult on their income, to asking whether they were living comfortably, struggling, or neither. From 2010 onwards the middle category represents those who were neither comfortable nor struggling on present income.

For sample sizes, see Annex A,Table A.18.