Worldwide Cost of Living Survey 2012 – City Ranking

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Tokyo is the world’s most expensive city for expatriates, pushing Luanda, Angola, down to second position, according to Mercer’s latest Cost of Living Survey. Osaka is in third position, up three places from last year, whereas Moscow remains in fourth and Geneva in fifth positions. Singapore and Zurich share sixth place, up two and one places respectively since 2011. Ndjamena, Chad, drops five places, but Hong Kong retains its ninth place.

Karachi (214) is ranked as the world’s least expensive city for expatriates, less than one-third as expensive as Tokyo. Recent world events, including economic and political upheavals, have affected the rankings for many regions through currency fluctuations, inflation, and volatility in accommodation prices.

In the UK, London (25) is the most expensive city for expatriates, down seven places from last year. At 133, Birmingham is up 17 places, having overtaken Aberdeen (148) and Glasgow (161). Belfast (165) is the UK’s least expensive city, up 13 places in the ranking since 2011.

The survey covers 214 cities across five continents and measures the comparative cost of over 200 items in each location, including transport, food, clothing, household goods and entertainment. The cost of housing is also included and, as it is often the biggest expense for expatriates, it plays an important part in determining where cities are ranked. Mercer’s cost-of-living survey is the world’s most comprehensive and is designed to help multinational companies and governments determine compensation allowances for their expatriate employees. New York is used as the base city and all cities are compared against it. Currency movements are measured against the US dollar.

Nathalie Constantin-Métral, Principal at Mercer, is responsible for compiling the ranking each year. She commented: “Deploying expatriate employees is becoming an increasingly important aspect of multinational companies’ business strategy, including expansion. But with volatile markets and stunted economic growth in many parts of the world, a keen eye on cost efficiency is essential, including on expatriate remuneration packages. Making sure salaries adequately reflect the difference in cost of living to the employee’s home country is important in order to attract and retain the right talent where companies need them.”

“When compared to New York, our benchmark city, most European cities have witnessed a decline in cost of living. Some exceptions exist where accommodation prices have increased or additional VAT taxes have pushed the cost of living up. In North America, most cities have gone up in the ranking, as the US dollar has strengthened against a large proportion of the world’s other currencies. In Asia, more than six in ten cities moved up in the rankings, including all surveyed cities in Australia, China, Japan and New Zealand. Cities in Australia and New Zealand witnessed some of the biggest jumps, as their currencies strengthened significantly against the US dollar.”

The Americas

SÃo Paulo (12) and Rio de Janeiro (13) remain the most expensive cities for expatriates across both North and South America, and are closely trailed by Caracas (29), which jumped 22 places since last year. In South America, Brasilia (45) is now the fourth most expensive city, down 12 places. Dropping from 53rd position, Havana (99) experienced the largest drop in the region as the US dollar strengthened considerably against the Cuban peso. At 121, up from 159, Buenos Aires made the region’s biggest jump up the list following strong inflation, which considerably increased the cost of goods, and an increase in accommodation cost.

Ms Constantin-Métral commented: “Inflation pressures continued to push some South American cities up the ranking, whereas for some of the region’s cities, weakening of the local currencies caused them to rank lower.”

Ranking 33 (down from 32 in 2011), New York City remains the most costly city in the United States. Los Angeles (68) and San Francisco (90) are slowly catching up, however, having jumped a respective nine and 16 places since last year. Amongst other major US cities, Washington (107) is up one place, Miami (110) is up five places and Chicago, also at 110, is down two places. Portland, Oregon (178), and Winston-Salem, North Carolina (195), remain the least expensive surveyed cities for expatriates in the United States. Ms Constantin-Métral said: “Although price increases have remained moderate overall, most US cities have gone up in the ranking, mainly as a result of the strong US dollar.”

Toronto (61) remains the highest ranking city in Canada, closely followed by Vancouver (63). MontrÉal (87) has dropped eight places, whereas Calgary (92) has climbed four.

City Rankings

Top 50 cities: Cost of living ranking

Mercer international basket including rental accommodation costs
Base City: New York, US

Rankings

March 2012

March 2011

City

Country

12TOKYOJAPAN
21LUANDAANGOLA
36OSAKAJAPAN
44MOSCOWRUSSIA
55GENEVASWITZERLAND
67ZURICHSWITZERLAND
68SINGAPORESINGAPORE
83N’DJAMENACHAD
99HONG KONGHONG KONG
1011NAGOYAJAPAN
1114SYDNEYAUSTRALIA
1210SÃO PAULOBRAZIL
1312RIO DE JANEIROBRAZIL
1416BERNSWITZERLAND
1521MELBOURNEAUSTRALIA
1621SHANGHAICHINA
1720BEIJINGCHINA
1815OSLONORWAY
1930PERTHAUSTRALIA
2012LIBREVILLEGABON
2117COPENHAGENDENMARK
2219SEOULSOUTH KOREA
2334CANBERRAAUSTRALIA
2431BRISBANEAUSTRALIA
2518LONDONUNITED KINGDOM
2644KHARTOUMSUDAN
2746ADELAIDEAUSTRALIA
2829ST. PETERSBURGRUSSIA
2951CARACASVENEZUELA
3043SHENZHENCHINA
3124TEL AVIVISRAEL
3138GUANGZHOUCHINA
3332NEW YORK CITY, NYUNITED STATES
34

23

NIAMEYNIGER
35

70

YANGONMYANMAR
36

61

KINSHASADEM. REP. OF THE CONGO
37

27

PARISFRANCE
38

25

MILANITALY
39

41

LAGOSNIGERIA
39

63

BAMAKOMALI
41

67

ABIDJANCÔTE D’IVOIRE
42

34

ROMEITALY
43

55

BRAZZAVILLECONGO
44

39

DJIBOUTIDJIBOUTI
45

33

BRASILIABRAZIL
46

39

STOCKHOLMSWEDEN
47

37

NOUMÉANEW CALEDONIA
48

36

VIENNAAUSTRIA
49

48

BAKUAZERBAIJAN
50

25

VICTORIASEYCHELLES
50

44

DAKARSENEGAL

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