Why Happiness is So Important at Work


By Yvonne Milosevic

Before the “Great Resignation” of 2021, employee happiness was an afterthought at many companies. Sure, cheerful workers were nice to have in The Before Times. Yet most businesses didn’t rank emotional well-being high up on their priorities list. But if we suspect that happy employees are also the top performers, it begs the classic chicken and egg question.

“Which comes first, succeeding and then being happy, or being happy and then succeeding? And just how much does initial happiness matter?”

To find out, researchers Paul B. LesterEd Diener, and Martin Seligman ran the most extensive and longest well-being study ever. It spanned five years and included almost one million people, and their results recently appeared in the Spring issue of MIT Sloan Management Review.

Similar studies of workplace happiness have focused on office workers. But this study had a unique source population: U.S. Department of Defense employees. Before you brush off this sample pool as irrelevant to an ordinary work environment, consider this: the defense department is the world’s largest single employer.

Bigger than Walmart

“What we learn from the military can and often does apply to the business world,” the study’s authors argue. “There are over 190 distinct job categories in the Army — from clerk to pilot, cook to commander — and most were included in our data.”

image credit: Robert Couse-Baker

Throughout the study, the researchers followed the subjects and had them rate their well-being and optimism. Next, they tracked the job performance recognition that the soldiers received over time. Noting that the Army rarely offers rewards for exemplary job performance or heroism, they report that only 12% of the one million soldiers received an award during the study.

Although they expected optimism and well-being to affect performance, they couldn’t believe how much those qualities mattered. “We saw four times as many awards earned by the initially happiest soldiers…compared with those who were unhappiest initially,” the researchers reveal.

“Happiness — and, to a somewhat lesser extent, optimism — were better predictors of awards than any demographic factor we examined,” they add.

Happiness Brings a Competitive Advantage

This massive study builds on more than 40 years of behavioral science research. So, what’s the takeaway for the civilian business environment? “There is a lot of room for leaders and organizations to influence happiness within the workplace,” the researchers contend. “We suggest that leaders follow the science and take a structured approach to hiring for, promoting, and developing employee happiness.”

Here are three areas the authors think companies should focus on.

Measure happiness in employees and job candidates.

The researchers don’t advocate placing happiness above specific skills or talents a job requires. Yet they do believe using proven assessment tools is a low-risk way to break a tie between equally qualified candidates. “Most organizations are likely better off hiring someone who is already relatively happy and optimistic,” they say, “because they will influence exceptional performance and reduce turnover.”’

Cultivate happiness among employees.

At first glance, this task may seem daunting, but according to these researchers, there’s nothing to fear. “Training initiatives targeting employee well-being do not require a significant time investment, are cost effective, and carry a high ROI,” they say.


Two popular exercises companies can consider are Three Good Things and Using Signature Strengths in a New Way. For the first, participants make a note each day of three things that went well and why for one week. In the second, employees fill out an online strengths survey. Afterward, they use one of their reported top strengths in a new way each day for at least a week.

Past research showed that these exercises led to increased happiness and decreased depression for more than six months. That’s a high return on investment for such a low-lift effort.

Keep your happy employees around.

“Our military study shows that organizations should want happy employees, because they perform significantly better than those who are unhappy,” the researchers say. “But it turns out that organizations also need happy employees, because happiness is in fact contagious.”

Unfortunately, the flip side is also true: unhappiness is contagious, too. If management is in the position of keeping only one of two employees, these researchers see a clear answer.

“With performance and other factors held constant, they should keep the one who is happiest.”

For more advice on happiness, check out:

5 Steps to Improve Your Well-Being