Richard Layard is a labour economist who worked for most of his life on how to reduce unemployment and inequality. He is also one of the first economists to work on happiness, and his main current interest is how better mental health could improve our social and economic life.
Happiness and mental health
He has always believed, like the 18th Century Enlightenment, that societies should be judged by the happiness of the people. And since the 1970s he has urged fellow economists to return to the 18th and 19th century idea that public policy should maximise a social welfare function depending on the distribution of happiness. In 1980 he wrote, according to Richard Easterlin, "the first paper to focus specifically on the policy implications of empirical research on happiness". In 2005 he wrote Happiness: Lessons from a New Science, which was published in 20 languages. He continues to find significant effects of relative income on happiness and to emphasise the importance of non-income variables on aggregate happiness. And in 2018, he co-authored a book called The Origins of Happiness: The science of wellbeing over the life course. It presented the first comprehensive life-course description of wellbeing and laid out the foundation for policy interventions at different stages of life.
Layard’s work on happiness and wellbeing stresses the critical role of addressing mental health, and argues that psychological treatments ought to be much more widely available. Among other good effects, they pay for themselves through increased employment and reduced costs of other healthcare. His work here, with the distinguished psychologist David M. Clark, has led within the English National Health Service to the creation of a major programme of Improving Access to Psychological Therapies (IAPT) which is now treating over 650,000 people a year, of whom a half recover during treatment.
In 2009 he co-authored the A Good Childhood which emphasised the importance of early intervention to improve the mental health of children. The Report's proposals included the universal introduction of evidence-based treatment in child mental health. He is also actively involved in promoting wellbeing in schools, most recently through Healthy Minds, a 4-year secondary school curriculum in life skills which was trialled in 30 schools. The results were published in November 2018. It proved to have cost-effective results for both students and the teachers teaching them.
In 2014 he wrote a popular book on mental health, Thrive: The power of evidence-based psychological therapies, jointly with David M. Clark. The book argues that spending more money on helping people to recover - and stay well – is a top priority for public expenditure.
Like many others, Layard has pushed governments to measure the wellbeing of the population and was delighted when the British Prime Minister David Cameron announced in November 2010 that wellbeing would be a major government objective and be regularly measured in the national statistics. In 2018, with the support of the What Works Centre for Wellbeing, he revived the All Party Parliamentary Group on Wellbeing Economics which published their report A Spending Review to Increase Wellbeing: an open letter to the Chancellor calling for a major change of direction. That policy should be targeted at the wellbeing of the people and not at economic growth.
Worldwide, there is now a search for new models of progress. Professor Layard chaired the World Economic Forum Global Agenda Council on Health and Wellbeing, which launched a report at Davos in January 2012, “WellBeing and Global Success”. The OECD has for some years been attempting to redefine progress, and in July 2011 the UN General Assembly advocated greater priority for policies that promote happiness. Richard co-edits, with Jeff Sachs and John Helliwell, the World Happiness Reports. He was also a member of the Legatum Commission for Wellbeing Policy chaired by Gus O'Donnell. Its report on Wellbeing and Policy was published in March 2014
Richard Layard's concern with how to promote a happier society led him to co-found a new movement called Action for Happiness, which was launched in Spring 2011. Members from all backgrounds pledge to live so as to create as much happiness as they can and as little misery. The movement now reaches over one million people online (in 180 countries) and has already run over 400 courses with over 6,000 participants in 16 countries.
Drawing on all of his experience, and on the evidence now available from the science of happiness, in January 2020 Richard published Can We Be Happier? Evidence and Ethics. It advocates the Greatest Happiness Principle and presents the latest data to show how this idea might yet transform society and replace the destructively competitive values that have dominated in recent years. Reporting from the frontier of cutting edge science, he shows how actions by government, institutions and communities and in our personal lives could produce a gentler society within 40 years.
Influencing government policy will however require a whole new generation of researchers and analysts with expertise in the science of wellbeing. With this in mind, Richard has co-authored the first, field-defining textbook on the subject with Prof Jan-Emmanuel De Neve (Director of Oxford University’s Wellbeing Research Centre). “Wellbeing: Science and Policy”, published by Cambridge University Press in 2023, aims to integrate the social sciences by showing how each of them contributes to the goal of human wellbeing. It is now available in Open Access.
In 2022 Richard co-founded the World Wellbeing Movement. This aims to persuade governments to make wellbeing their goal, and business leaders to give much higher priority to the wellbeing of their stakeholders.
Unemployment, skills and inequality
On unemployment, in the 1980s Layard and colleagues developed the Layard-Nickell model of how the level of unemployment is determined. This has become the most commonly used model by European economists and governments. It assigns an important role to how unemployed people are treated, and provides the intellectual basis for the welfare-to-work policies introduced in many countries, including Britain, Germany and Denmark.
The basic message is in Unemployment: Macroeconomic Performance and the Labour Market. This was first published in 1991, and a second edition in 2005 shows how well the model predicts the development of unemployment in different countries since 1991.
On inequality, his work shows the key role of education in influencing the income of individuals and families. He has been a lifelong advocate of better vocational education (including apprenticeship) for less academic youngsters, and the case he made with Hilary Steedman led to major increases in apprenticeships and the 2009 Apprenticeship Act. In 2021 he became a member of the Lords Youth Unemployment Committee which aimed to tackle the huge inequality between Higher Education and Further Education funding and provision. They published their report in November 2021.
In 1985 he founded the Employment Institute which has played a major role in pushing the idea of welfare-to-work. He was Chairman of the European Commission's Macroeconomic Policy Group during the 1980s. From 1991-1997 he was a part-time economic adviser to the Russian Government and from 1997 to 2001 a part-time consultant to the British government on welfare-to-work and vocational education.
In 2005 the British government accepted his proposals on psychological therapy and he was then (as National Adviser) heavily involved in implementing the government programme of Improving Access to Psychological Therapies (IAPT). In 2010, this was extended to cover children.
In 2000 he was made a member of the House of Lords, and until 2019 was a member of its Economic Affairs Committee. Since then he has also served on the Gambling Industry Committee, but in 2022 returned to the Economic Affairs Committee. Richard is also deeply concerned about climate change. In 2014 he proposed, with six other colleagues, a Global Apollo Programme of internationally coordinated research to produce cheap, clean energy within 10 years, which provided the model for Mission Innovation - the major international programme launched by Presidents Obama, Modi and Hollande in Paris in November 2015.
Former ESRC executive chair Jennifer Rubin said:
“The impact of Lord Layard’s work can be seen in so many areas across the fields of education, employment, mental health and climate change and his influence is felt in academic research, public policy, community engagement – and across the political spectrum.”
To that end, in 2020, the ESRC recognised Richard Layard with a rare Lifetime Achievement Award to celebrate the outstanding contribution he has made to social science and society in the UK and beyond.