In this article, we will look at the 25 countries with the highest standards of living in 2023. You can skip our detailed analysis and head straight to the list of 10 Countries With the Highest Standard of Living in 2023.
To judge the quality of life for any country, the standard of living is one of the key indicators to look out for. While various factors contribute to the standard of living, like social services, education, and healthcare, it is often economic stability that is considered a major determinant. In this article, we will explore countries with the highest standard of living in 2023 and the study factors that contributed to their success.
Deteriorating Global Economic Crises
Living conditions in 90% of the world’s countries worsened in 2021, according to the UN Development Program (UNDP). Moreover, the Human Development Index (HDI), which evaluates a country’s health, education, and living standards, has witnessed a global decrease in these factors for the first time in its 32-year history.
The trend has been observed for two consecutive years, particularly affecting regions such as Latin America, the Caribbean, Sub-Saharan Africa, and South Asia. As a result, progress towards the 2030 Agenda’s Sustainable Development Goals has been significantly reversed, with human development levels regressing to those of 2016.
In 2022, the economy of Europe and Central Asia witnessed a significant decline in their growth rate fueled by the Russia-Ukraine crisis, rising inflation, and the tightening of monetary policy and financial conditions that severely impacted private consumption, investment, and trade. Moreover, the increased food and energy prices resulted in inflation rates reaching levels never observed in the last two decades.
For 2023, the anticipated growth rate of regional output for Europe and Central Asia has increased to 1.4%, much higher than the last forecast of 0.1%. The economy in the region has been observing a positive trend, although it remains severely affected.
The improvement may have been caused by the less severe contraction of the Russian economy with a stronger and prosperous outlook for Ukraine. The region’s average growth rate is expected to reach 2.7% over 2024-25, as inflation gradually subsides, domestic demand improves, and the external economic environment recovers.
Countries around the globe, developed or developing, face grave economic challenges that directly affect their living standards. According to the World Bank’s estimates, Turkiye was hit by two severe earthquakes on February 6, 2023, which caused direct damages amounting to around $34.2 billion, equivalent to 4% of the country’s 2021 GDP.
According to the National Institute for Economic and Social Research (NIESR), Britain is expected to be safe from recession in 2023. Still, its living standards will be hurt due to a surge in inflation, making it hard for some to pay their bills. The GDP growth forecast has been downgraded to 0.2% from 0.7%, with a further decrease to 1.0% in 2024. NIESR predicts that one in four households will need financial help for food and energy.
Companies that promise improved living standards
Despite depressive times globally, some public companies aim to contribute to improving living standards and quality of life for millions of people through different practices.
For example, Procter & Gamble Co (NYSE:PG) is dedicated to creating a water-positive future through sustainable practices and partnerships. Their “River of Progress to 2030” outlines their efforts to reduce water usage in manufacturing, innovate new solutions to water challenges, and support water restoration projects in 18 areas worldwide, including water-stressed metropolitan areas like Los Angeles.
In a significant move amidst a global economic crisis, Novo Nordisknovo (NYSE:NVO) announced that it will reduce insulin prices in the US by up to 75% for individuals with type 1 and type 2 diabetes in January 2024. This is certainly a major step towards reducing the financial burden on patients and improving access to healthcare that may save the lives of thousands of people.
Moreover, to elevate the social standing of women while addressing the issues of intersectionality, Johnson & Johnson (NYSE:JNJ) aims to have 50% of women in management positions globally, to achieve 35% ethnic and racial diversity in management positions within the U.S. Additionally, the company plans to grow the number of Black and African American employees in management positions in the U.S. by 50%.
Trends in the countries with the highest standards of living in 2023
A common trend observed in the countries with the highest standard of living in 2023 is that they have one of the most educated populations in the world. For example, Japan stands out for its strong education system, with many young adults holding tertiary qualifications.
In 2021, 65% of 25-34 year-olds in Japan held a tertiary qualification, compared to the OECD average of 47%. While Japan spends less than the OECD average on pre-primary education institutions, the Japanese community still has a solid focus on the education sector, with 34% of funding coming from private sources.
Another common trend observed is that most countries on the list have democratic governance systems with fair and free elections. According to an analysis conducted by Acemoglu, a professor at MIT, countries that transitioned to democratic forms of government in the last 70 years experienced significant economic growth.
The study, which looked at 184 countries from 1960 to 2010, found that countries such as Portugal and South Korea saw a 20% increase in GDP per capita within 20 years of adopting democracy, on average. The findings suggest a correlation between the establishment of democratic governments and economic development.
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Methodology
The method utilized to compile the list of the 25 countries with the highest standards of living in 2023 involved two primary metrics, the Human Development Index (HDI) from the UN and the overall rankings for the Best Countries, as determined by US News.
The rankings derived from the HDI and the Best Countries lists were averaged to generate an aggregate score, subsequently utilized to rank and identify the top 25 countries with the highest standard of living in 2023. Using standardized metrics allows for a comprehensive and data-driven approach to evaluating the living standards of the top 25 countries.
25. Slovenia
HDI ranking: 24
US news ranking: 61
Average ranking: 42.5
Slovenia has an excellent and robust infrastructure, a highly educated workforce, and a strategic location bridging the Balkans and Western Europe. The country has one of the highest per capita GDPs in Central Europe. It is also one of the safest countries in the world, with a very low crime rate.
Moreover, according to OECD better life index, Slovenia’s life expectancy is 82 years, with women living longer than men. Air pollution is slightly above the OECD average, but 93% of Slovenians are satisfied with their water quality.
24. Israel
HDI ranking: 22
US news ranking: 37
Average ranking: 29.5
Israel has one of the highest living standards in the region, with salaries in line with the European average. The IMF estimated the GDP per capita PPP at $52,173 in 2022. Israel has established itself as a top-performing economy within the OECD, largely attributed to a growing working-age population and participation rate.
Procter & Gamble Co (NYSE:PG) has a significant presence in Israel, as its wide range of products, including Pantene, H&S, Gillette, Oral-B, Pampers and Always, are found in as many as 98% of households in the country.
23. UAE
HDI ranking: 26
US news ranking: 21
Average ranking: 23.5
UAE is a highly sought-after destination known for its luxurious lifestyle, state-of-the-art infrastructure, and low crime rate. While it has various leisure and entertainment options, living can be costly, and the hot climate can be challenging.
Dubai’s tax-free status is a major attraction for expatriates, who are willing to enjoy its high quality of life. With no income tax on earnings and no sales tax on most goods and services, Dubai is a highly appealing destination for those looking for financial benefits.
In 2022, Emirates Health Services and Johnson & Johnson (NYSE:JNJ) signed an MoU to cooperate in developing a structured educational curriculum for healthcare professionals—the agreement aimed to support innovative and sustainable health services that boost efficiency across the entire health system.
22. Austria
HDI ranking: 25
US news ranking: 22
Average ranking: 23.5
Austria’s exceptional standard of living is evident through its low crime rate, excellent social security system, and recreational hubs. Austria is renowned for its safety and security, with few countries in the world matching its level of protection for individuals and property. Austria is ranked second globally for its quality of life, according to the IMD World Competitiveness Yearbook 2019.
21. Italy
HDI ranking: 30
US news ranking: 14
Average ranking: 22
As per OECD, Italy outperforms the average in health, work-life balance, and civic engagement. Italy also has excellent healthcare, with a life expectancy at birth of around 84 years, three years higher than the OECD average of 81 years. Women in Italy have a life expectancy of 86 years, compared to 81 years for men.
20. Spain
HDI ranking: 27
US news ranking: 16
Average ranking: 21.5
Spain has a strong job market and is undoubtedly economically and politically stable. Spain is also considered a safe country; it scores 64.8 out of 100 for safety and is family-friendly.
19. Luxembourg
HDI ranking: 17
US news ranking: 24
Average ranking: 20.5
Luxembourg has a cosmopolitan population with over 46% of foreign residents, making it the European country with the most expats, and around 100,000 people live in its capital city.
Luxembourg has a comprehensive public health system that covers 98% of the population. In contrast, the private health sector is mainly supplemental.
18. South Korea
HDI ranking: 20
US news ranking: 20
Average ranking: 20
South Korea’s high living standards are attributed to its stable economy, efficient public transportation, excellent healthcare and education, low crime rates, and advanced technology. South Korea is home to a highly developed market, leading to a high living standard. It is home to renowned domestic companies like Samsung and also hosts foreign companies. Procter & Gamble Co (NYSE:PG) in South Korea markets 8 renowned brands, such as Gillette, Pantene, and Pampers. Its Seoul headquarter employs over 200 people, while its distribution centre is in Chonan.
17. France
HDI ranking: 28
US news ranking: 9
Average ranking: 18.5
France has high living standards due to its developed economy, high-quality healthcare and education systems, excellent infrastructure, rich cultural heritage, and renowned cuisine. The country also has a high life expectancy of 82 years and low social deprivation rates of less than 13.1% of the population. These factors contribute to making France a desirable place to live and work.
16. Singapore
HDI ranking: 12
US news ranking: 19
Average ranking: 15.5
Singapore has a reputation for being safe, corruption-free, and economically liberal. The government has made significant investments in health, education, and infrastructure, making it an attractive option for living and conducting business.
In 2018, Johnson & Johnson (NYSE:JNJ) opened a new design lab in Singapore to develop innovative medical devices and technologies for the Asia-Pacific region.
15. Belgium
HDI ranking: 13
US news ranking: 18
Average ranking: 15.5
Belgium is famous for its high standard of living because of its stable and developed economy, excellent healthcare and education systems, and overall quality of life. Moreover, in 2017, the World Economic Forum ranked Belgium as the 7th best place for education.
14. Ireland
HDI ranking: 8
US news ranking: 23
Average ranking: 15.5
United Nations ranks Ireland as the second-best country in human development in 2020. Ireland had a life expectancy of 82.3 years at birth, ranking joint 15th out of 189 countries worldwide. Regarding expected years of schooling, Ireland ranked eighth with 18.7 years and is the fifth wealthiest country, with a gross national income (GNI) per capita of $68,371, with Liechtenstein ranking first with a GNI per capita of $131,032.
Novo Nordisk (NYSE:NVO) has a strong presence in Ireland, as demonstrated by the launch of its latest products in the country, i.e., the NovoPen 6 and NovoPen Echo Plus, which offer digital connectivity to help improve the lives of people living with diabetes.
13. Finland
HDI ranking: 11
US news ranking: 15
Average ranking: 13
Finland has been ranked as the third-best country in the world for quality of life in the Social Progress Index 2022. Among 169 countries, Finland has earned high scores in almost all report categories, from basic needs to personal freedoms. Finland ranks the highest in water and sanitation, and personal rights. Finland’s education system is also one of the best in the world.
12. United Kingdom
HDI ranking: 18
US news ranking: 8
Average ranking: 13
The UK has high living standards due to a strong economy, access to a top-notch educational system and healthcare, a high standard of housing, and robust social welfare programs. The country’s open and diverse culture and stable political and social environment contribute to the overall high standard of living in the UK.
11. New Zealand
HDI ranking: 14
US news ranking: 11
Average ranking: 12.5
New Zealand is known for having high living standards due to an ever-flourishing and stable economy, efficient healthcare and education systems, and a high quality of life. The country has a low crime rate, a sound political, and a clean environment.
New Zealand’s strong commitment to social welfare programs, such as universal healthcare, free education, and retirement benefits, also contributes to its reputation as a desirable place to live.
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Disclosure: None. 25 Countries with the Highest Standards of Living in 2023 is published originally on Insider Monkey.