CNBC Make It
Hong Kong is an expensive place to live and work.
Hong Kong has been selected as the most expensive city to live and work abroad this year, according to a new report highlighting the impact of rising living costs and worsening macroeconomic trends on the expatriate market.
After being ranked second in 2021 by Ashgabat in Turkmenistan, the city climbed first in Mercer’s 2022 Cost of Living Index and regained pole position. This is the fourth time in five years that Asian financial hubs have been ranked as the most costly place for foreign workers.
Hong Kong’s revival was partially driven by rising inflationary pressures. This has increased living expenses around the world. Meanwhile, continued Covid restrictions and rising political instability have resulted in higher compensation for staff stationed there, Mercer’s partner Vince Cordova told CNBC MakeIt.
“Part of it is the real estate market,” said Cordova, who said desirable accommodations are now more expensive, pushing up the cost of expatriate packaging.
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“The other part is the cost and political uncertainty of goods and services. People who go there need to spend more to live in good health,” he said.
The city ranked 13th in the Economist Intelligence Unit’s Global Living Ability Index 2022, cited last week by the EIU as a loss of political and cultural freedom.
Hong Kong was the top five Asian outliers dominated by Swiss cities in Mercer’s 2022 Cost of Living Index. Zurich, Switzerland, is ranked as the second most expensive city in the world for foreign workers, followed by Geneva (3rd), Basel (4th) and Bern. (5 days).
Cordova said it was due to the strength of the Swiss franc, which until recently was stable against the rise of the US dollar, the benchmark currency in Mercer’s report.
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Zurich was ranked as the second most expensive city to live and work in.
How to use
Mercer’s Annual Cost-of-Living Index is now in its 28th year and is a wage package for expatriates by businesses and governments by measuring accommodation costs and prices of goods and services in the local market relative to costs in New York City. It is designed to help you decide.
This year’s index ranked 227 cities and, as of March 2022, took into account the prices of over 200 items from categories such as food, transportation, housing and personal care.
Unlike the previous year, according to Cordova, the 2022 report shows that remote work is becoming more prevalent and more companies are using remote work as a tool in determining flexible work policies.
“One of the consequences of the pandemic is this notion of working from anywhere, and now more employees are asking their employers if they can support it,” he said.
“Companies are now looking for information about what the economic impact of the move will be, and that’s how we see the expansion of mobility,” he added.
Here’s an overview of the 10 most expensive cities for foreigners, according to Mercer’s findings:
The most expensive city for foreigners
- Hong Kong, Hong Kong (SAR)
- Zurich, Switzerland
- Geneva, Switzerland
- Basel, Switzerland
- Bern, Switzerland
- Tel Aviv, Israel
- New York City, United States
- Singapore, singapore
- Tokyo Japan
- Beijing, China
Turkey’s Ankara (227th) is ranked as the cheapest city to work abroad, followed by Bishkek, Kyrgyzstan (226th), Dushanbe, Tajikistan (225th), Islamabad, Pakistan (224th), Karachi, Pakistan (223rd) followed.