Living standards in the west definitely have improved up until relatively recently (at the expense of a lot of people in what we used to call 'the developing world' - I think 'global south' is now the accepted term).
That stopped about 15 -20 years ago though and now things are on the slide, with Gen X the first generation to have a worse standard of life than the boomers before them and it then getting worse for millenials and even worse for Gen Z. Even life expectancy is now dropping. They are repealing child labour laws in the US (Arkansas and others) and it's only a matter of time before that kind of thing makes it's way over the atlantic.
I also definitely agree that we should not confuse living standards with quality of life, which never rose as high and has been dropping for longer.
You say that people don't want to do without material comforts and I think that's true, but it's also something we've been carefully conditioned to believe as well. All that money spent on marketing isn't being wasted. It doesn't make us happier though (often the opposite) and our energies could be spent much more productively and much more fairly, so that we don't have to work ourselves to the bone in order to try and slow down our slide down the hill a little bit. The problem is that the system we live under, and those who benefit most from it, don't want us to believe that things can change, that there may be an alternative, that we can live with less and be happy. They want us to work more, because for every x pounds we earn or that goes on public services, they get xxxx pounds and in the end capitalism is a zero-sum, last person standing kind of game.
We don't have much time left to stop it before the momentum is unstoppable.