The Psalm 128 is a poem of praise for the happiness of the blessed, the Psalm is dedicated to the Fear of the Lord.
The Psalm express:

Blessed is everyone who fears the Lord,
who walks in his ways! Psalm 128

The blessed life is to live the spiritual gifts received from God. Some of these gifts are: the fear of the Lord, the gift of counsel, the continuous improvement, mercy, righteousness, constancy.
The spiritual gifts are perfections, not virtues. The virtues responds to the plane of the soul, to an intermediate state between good and evil. The gifts respond to the plane of the perfections, of the spiritual.
The Bible teach us about a "living according to the flesh" or to say to practice the sin, and a "living according to the spirit", or to say the blessed life. Spiritual gifts and virtues are different concepts, the virtuous life and the blessed life are not the same.
The fear of God is defined as constancy, firmness, devotion, equanimity, stability. The fear of God (constancy) is the basis of wisdom (Proverbs 9:10), the word of God fructifies through constancy (parable of the sower, Matthew 13)
The blessed life, that is, to seek the correct and the best, bears fruit when it is united to constancy and firmness in the practice of the good.
The fear of the Lord is the base of the spiritual life of man and the foundation of the life in God.
This beautiful song reminds us that happiness is for those who knows the ways of God, that is to say their gifts, the gifts are path because we grow.