ASIATODAY.ID, JAKARTA – As the world continues to recover from Covid-19, Mercer’s annual 2021 Cost of Living survey saw Asia dominating the world’s most expensive city rankings, despite significant shifts. Hong Kong lost top spot – a position it held for the past three years – to Ashgabat, Turkmenistan, now the costliest city for international employees, both in Asia and globally. Tokyo, Japan now ranked fourth was leapfrogged by Beirut, Lebanon which climbed 42 positions to third, as a result of a severe and extensive economic depression due to escalation of several crises — the country’s largest financial crisis, COVID-19 and the Port of Beirut explosion in 2020.
More than half of the top 10 most expensive cities are located in Asia. Shanghai and Beijing ranked sixth and ninth respectively, up one place from last year, while Singapore moved from fifth place to seventh. Other cities appearing in the top 10 of Mercer’s most costly cities for international employees are Zurich (5), Geneva (8) and Bern (10).
The survey saw a rise in rankings across all Mainland China cities, buoyed by currency appreciation against the US dollar and a swift recovery from the impact of COVID-19. Most notably, Tianjin and Chengdu climbed 12 positions to 26th and 28th respectively. Strengthening of the Taiwan dollar saw Taipei jump six places to 22. Currency fluctuations and deflation saw Southeast Asian cities like Bangkok and Kuala Lumpur drop in rankings.
Bangkok (46) dropped 11 places, while Kuala Lumpur (144) dropped 8 places. Mumbai (78) is India’s most expensive city but dropped 18 places in this year’s ranking due to a relatively weak Indian rupee in comparison with other cities in the ranking.
Julia Radchenko, Global Mobility Leader, Asia Pacific, said, “Across the region, companies are actively reassessing their talent and mobility strategies in light of the complex challenges brought on by COVID-19. Companies are realising more than ever that they need to diversify their mobility scenarios and related compensation practices. And it is no longer about just geographical mobility, it is about talent mobility which implies lateral moves, distributed workforce, geographical mobility, international remote working, virtual assignments, etc.
“What we’ve seen is that companies are exercising more flexibility to accommodate the different personal situations of employees. Broadly speaking, companies are now more open to International remote working arrangements, allowing employers to perform the same role remotely as they would if they were to relocate. That said, international remote working arrangements bring with it other complexities such as determining the right compensation and whether such arrangements can fully replicate the importance and impact of having someone in a specific market.”
Companies re-evaluate global mobility programmes
COVID-19 continues to cause unparalleled disruption to international mobility, prompting companies to re-evaluate how they will manage a mobile workforce in a post-pandemic world. Cost of living data, mobility research conducted by Mercer and the learnings from Mercer’s work with clients demonstrates that after several years of organisations’ efforts to modernize mobility strategies, organisations are beginning to implement alternate forms of international assignments and cross-border working arrangements to sustain their overseas operations and workforces.
“Cost of living has always been a factor for international mobility planning, but the pandemic has added a whole new layer of complexity, as well as long-term implications related to health and safety of employees, remote working and flexibility policies, among other considerations,” said Ilya Bonic, Career President and Head of Mercer Strategy.
“As organisations rethink their talent and mobility strategies, accurate and transparent data is essential to compensate employees fairly for all types of assignments.”
Mobility is evolving from traditional long-term assignments – i.e., relocating an employee for a few years then repatriating them to their home location – to other kinds of mobility moves such as short-term assignees, international foreign hires, permanent transferees, commuters, international remote workers and international freelancers.
Mercer’s 2020 Worldwide Survey of International Assignment Policies and Practices confirmed that many of the companies surveyed are offering more flexible options to accommodate diverse personal circumstances of the assignees. Another 2020/2021 Mercer survey found that over 50% of employers surveyed expected changes in terms of the number of one-way transfers, talent development, short-term and commuter assignments in their organisations due to the pandemic.
Mercer’s latest Cost of Living Survey helps employers understand the importance of monitoring currency fluctuations and assessing the inflationary and deflationary pressures on goods, services and accommodation in all operating locations. The data also helps employers determine and maintain compensation packages for employees on international assignments and when working abroad. Additionally, the cost of living in a location can have a significant.
Mercer’s Alternative International Assignments survey impact on its attractiveness as a destination for talent, and influences site selection decisions for organisations expanding and transforming their geographic footprint.
Rankings for Other Regions
The Americas
Cities in the US have dropped in this year’s ranking mostly due to currency fluctuations between March 2020 and March 2021, despite the rising inflation of goods and services in the country. New York (14) ranked as most expensive city in the US, though it dropped eight positions since last year, followed by Los Angeles (20), San Francisco (25), Honolulu (43) and Chicago (45). Winston Salem (151) remains the least expensive US city surveyed for international employees. San Juan (89) dropped 23 positions due to deflation in the second part of 2020 and a very low inflation in the beginning of 2021 hence affecting the position in the ranking.
The Canadian dollar has appreciated in value in relation to the USD, triggering jumps in this year’s ranking. Vancouver (93) is the most expensive Canadian city in the ranking, followed by Toronto (98) and Montreal (129). Ranking 156, Ottawa is the least expensive city in Canada.
In South America, Port of Spain (91) ranked as the most expensive city, followed by Port-au-Prince (92) and Pointe-àPitre (107). Brasilia (205) is the least expensive city in South America.
Europe, the Middle East, and Africa
Three European cities are among the top 10 list of most expensive locations. Number five in the global ranking, Zurich remains the costliest European city, followed by Geneva (8) and Bern (10). The strengthening of local currency resulted in several European cities climbing in the ranking, with Paris climbing to 33. Local currency in the United Kingdom remains strong with London (18), Birmingham (121) jumping one and eight places, respectively.
The United Arab Emirates continued to diversify its economy, which educed the impact of the oil industry on GDP. With this ongoing process, there has been negative price movement in both Dubai (42) and Abu Dhabi (56). Beirut is the costliest city in the Middle East for international employees, jumping 42 positions to third in the global ranking. N’Djamena (13), Lagos (19) and Libreville (20) are first, second and third costliest cities in Africa for international employees. Lusaka ranked 208 is the least costly city in Africa.
Pacific
Australian cities have climbed in this year’s ranking as the local currency significantly gained value against the USD. Sydney (31), Australia’s most expensive ranked city for international employees, experienced a climb of 35 places, followed by Melbourne (59) with a climb of 40 places.
For reference, Mercer’s widely recognized ranking is one of the world’s most comprehensive, and is designed to help multinational companies and governments determine compensation strategies for their expatriate employees. New York City is used as the base city for all comparisons and currency movements are measured against the US dollar. The survey includes over 400 cities throughout the world; this year’s ranking includes 209 cities across five continents and measures the comparative cost of more than 200 items in each location, including housing, transportation, food, clothing, household goods, and entertainment. The data collected provides all of the key elements employers need to design efficient and transparent compensation packages for international assignees. Learn more here.
The figures for Mercer’s cost of living and rental accommodation cost comparisons are derived from a survey conducted in March 2021. Exchange rates from that time and Mercer’s international basket of goods and services from its Cost of Living Survey have been used as base measurements.
Governments and major companies use data from this survey to protect the purchasing power of their employees when transferred abroad; rental accommodation costs data is used to assess local expatriate housing allowances. The choice of cities surveyed is based on demand for data from Mercer’s clients.
Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. Mercer’s approximately 25,000 employees are based in 43 countries and the firm operates in 130 countries. Mercer is a business of Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, stra tegy and people, with 76,000 colleagues and annual revenue of $17 billion. Through its market-leading businesses including Marsh, Guy Carpenter and Oliver Wyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. (AT Network)
Mercer Cost of Living Survey – Worldwide Rankings 2021
Rank as of March City Location
2020 2021
2 1 ASHGABAT Turkmenistan
1 2 HONG KONG Hong Kong (SAR)
45 3 BEIRUT Lebanon
3 4 TOKYO Japan
4 5 ZURICH Switzerland
7 6 SHANGHAI China
5 7 SINGAPORE Singapore
9 8 GENEVA Switzerland
10 9 BEIJING China
8 10 BERN Switzerland
11 11 SEOUL South Korea
13 12 SHENZHEN China
15 13 NDJAMENA Chad
6 14 NEW YORK CITY United States
12 15 TEL AVIV Israel
25 16 COPENHAGEN Denmark
20 17 GUANGZHOU China
19 18 LONDON United Kingdom
18 19 LAGOS Nigeria
33 20 LIBREVILLE Gabon
17 20 LOS ANGELES United States
28 22 TAIPEI Taiwan
22 23 OSAKA Japan
36 24 ABIDJAN Cote d’Ivoire
16 25 SAN FRANCISCO United States
38 26 TIANJIN China
34 27 NANJING China
40 28 CHENGDU China
31 29 RIYADH Saudi Arabia
49 30 BANGUI Central African Republic
66 31 SYDNEY Australia
42 32 NOUMEA New Caledonia
50 33 PARIS France
43 34 QINGDAO China
26 34 NAGOYA Japan
47 36 MILAN Italy
54 37 VIENNA Austria
44 38 BRAZZAVILLE Congo
46 39 DUBLIN Ireland
26 40 DHAKA Bangladesh
24 41 KINSHASA Dem. Rep. of the Congo
23 42 DUBAI United Arab Emirates
28 43 HONOLULU United States
64 44 AMSTERDAM Netherlands
30 45 CHICAGO United States
35 46 BANGKOK Thailand
65 47 ROME Italy
37 48 MIAMI United States
56 49 YAOUNDE Cameroon
41 50 BOSTON United States
32 51 WASHINGTON United States
72 52 MUNICH Germany
78 53 BRUSSELS Belgium
76 54 FRANKFURT Germany
76 55 OSLO Norway
74 56 HELSINKI Finland
39 56 ABU DHABI United Arab Emirates
75 56 DAKAR Senegal
99 59 MELBOURNE Australia
82 60 BERLIN Germany
63 61 SHENYANG China
21 62 MOSCOW Russia
104 63 PERTH Australia
83 63 LUXEMBOURG Luxembourg
48 65 WHITE PLAINS United States
70 66 DOUALA Cameroon
87 67 MADRID Spain
55 67 SEATTLE United States
52 69 DALLAS United States
103 70 AUCKLAND New Zealand
52 71 MANAMA Bahrain
133 72 STOCKHOLM Sweden
60 72 ATLANTA United States
100 74 DUSSELDORF Germany
62 75 MORRISTOWN United States
51 75 HOUSTON United States
118 75 CANBERRA Australia
60 78 MUMBAI India
80 78 MANILA Philippines
106 80 HAMBURG Germany
126 81 BRISBANE Australia
58 82 DJIBOUTI Djibouti
106 83 LISBON Portugal
102 84 BARCELONA Spain
68 85 ABUJA Nigeria
69 86 MINNEAPOLIS United States
57 87 ACCRA Ghana
126 88 ADELAIDE Australia
66 89 SAN JUAN Puerto Rico
97 90 PRAGUE Czech Republic
73 91 PORT OF SPAIN Trinidad & Tobago
175 92 PORT AU PRINCE Haiti
94 93 VANCOUVER Canada
123 94 WELLINGTON New Zealand
71 94 AMMAN Jordan
104 94 JEDDAH Saudi Arabia
113 97 RIGA Latvia
98 98 TORONTO Canada
116 99 NIAMEY Niger
123 100 LYON France
80 101 DETROIT United States
130 102 STUTTGART Germany
83 103 ST. LOUIS United States
83 104 YANGON Myanmar
86 104 JAKARTA Indonesia
92 106 PORTLAND United States
134 107 POINTE A PITRE Guadeloupe
134 108 SANTIAGO Chile
96 108 MUSCAT Oman
91 110 PITTSBURGH United States
139 110 BRATISLAVA Slovakia
93 112 CLEVELAND United States
140 113 COTONOU Benin
121 114 CASABLANCA Morocco
138 115 ATHENS Greece
113 115 KUWAIT CITY Kuwait
101 117 NEW DELHI India
90 117 PANAMA CITY Panama
89 119 CONAKRY Guinea Republic
59 119 ST. PETERSBURG Russia
129 121 BIRMINGHAM United Kingdom
118 122 BANDAR SERI BEGAWAN Brunei
115 123 LUANDA Angola
78 124 SAN JOSE Costa Rica
109 125 PHNOM PENH Cambodia
142 126 BAMAKO Mali
148 126 LJUBLJANA Slovenia
134 128 ABERDEEN United Kingdom
137 129 MONTREAL Canada
109 130 DOHA Qatar
141 131 GLASGOW United Kingdom
88 132 MONTEVIDEO Uruguay
146 132 TALLINN Estonia
155 134 NUREMBERG Germany
123 134 HAVANA Cuba
154 136 LOME Togo
126 137 CAIRO Egypt
158 138 LEIPZIG Germany
116 139 HANOI Vietnam
152 140 ZAGREB Croatia
122 141 GUATEMALA CITY Guatemala
165 141 HARARE Zimbabwe
111 143 HO CHI MINH CITY Vietnam
157 143 VILNIUS Lithuania
162 145 OUAGADOUGOU Burkina Faso
95 145 NAIROBI Kenya
146 145 CALGARY Canada
149 148 BELFAST United Kingdom
106 149 KIEV Ukraine
112 150 LIMA Peru
132 151 WINSTON SALEM United States
120 152 MEXICO CITY Mexico
163 152 TIRANA Albania
144 152 KUALA LUMPUR Malaysia
159 152 RABAT Morocco
151 156 OTTAWA Canada
166 156 LIMASSOL Cyprus
143 158 CHENNAI India
14 159 VICTORIA Seychelles
174 160 BUCHAREST Romania
145 161 QUITO Ecuador
170 162 BUDAPEST Hungary
183 163 BELGRADE Serbia
169 164 WARSAW Poland
150 165 KINGSTON Jamaica
180 165 SOFIA Bulgaria
163 167 DAR ES SALAAM Tanzania
153 168 BUENOS AIRES Argentina
168 169 SAN SALVADOR El Salvador
171 170 BENGALURU India
177 171 KAMPALA Uganda
172 172 BAKU Azerbaijan
156 173 ISTANBUL Turkey
167 173 SANTO DOMINGO Dominican Republic
176 175 KIGALI Rwanda
184 176 NOUAKCHOTT Mauritania
130 177 SAO PAULO Brazil
187 178 CAPE TOWN South Africa
161 179 MAPUTO Mozambique
181 180 BOGOTA Colombia
185 181 KOLKATA India
173 182 PORT LOUIS Mauritius
177 183 MONTERREY Mexico
192 184 JOHANNESBURG South Africa
177 185 COLOMBO Sri Lanka
197 186 SARAJEVO Bosnia-Herzegovina
188 187 ASUNCION Paraguay
196 188 TEGUCIGALPA Honduras
193 189 LA PAZ Bolivia
185 190 BLANTYRE Malawi
160 191 RIO DE JANEIRO Brazil
202 192 SKOPJE North Macedonia
189 193 ALMATY Kazakhstan
182 194 ADDIS ABABA Ethiopia
191 195 YEREVAN Armenia
198 196 MANAGUA Nicaragua
194 197 MINSK Belarus
194 198 ALGIERS Algeria
200 199 ISLAMABAD Pakistan
204 200 BANJUL Gambia
205 201 KARACHI Pakistan
199 202 GABORONE Botswana
206 203 TASHKENT Uzbekistan
208 204 WINDHOEK Namibia
190 205 BRASILIA Brazil
209 206 TUNIS Tunisia
203 207 TBILISI Georgia
201 208 LUSAKA Zambia
206 209 BISHKEK Kyrgyzstan
Source: Mercer’s 2021 Cost of Living Survey