2016 Mercer Cost of Living Survey

2016 Mercer Cost of Living Survey

2016 Cost of Living Survey Rankings

  • June 22, 2016
  • Middle East, Dubai

UAE Cities Now in the Worldwide Top 25 In Terms of Expatriate Cost of Living

Mercer Middle East 2016 Cost of Living Study Shows Dubai and Abu Dhabi as 21st and 25th Most Expensive Cities on the Globe

Dubai, United Arab Emirates: Dubai and Abu Dhabi have been ranked the most expensive cities to live in across the Middle East, according to Mercer’s 2016 Cost of Living Survey. The global rankings see Dubai as the 21st  most expensive city in the world, a rise of two places in comparison to last year, with Abu Dhabi, 25th  in world, changed from 33rd last year. The two UAE cities have experienced a rise in their world rankings in this respect, following the wider Middle Eastern trend of GCC countries becoming more expensive.

Talent Mobility Consultant at Mercer Middle East, Rob Thissen, said: “The main reason Dubai and Abu Dhabi, and in fact almost all cities in the Middle East increased in rank, is that their currencies are pegged to the US Dollar, with Riyadh for instance currently rated more expensive than Rome.”

The Middle East has multiple locations situated in the world’s top hundred, with a strong showing primarily from the GCC countries. Several cities experienced a jump in the rankings, as they are pushed up by other locations’ decline, as well as the strong increase for expatriate rental accommodation costs, particularly in Abu Dhabi and Jeddah. One Levant city, Beirut, is positioned as the third most expensive city in the Middle East and 50th  globally, down from 44th last year; which is tied with nearby Amman, Jordan, also 50th, representing a rise of four places from last year. Returning to the GCC, Riyadh is the 57th most expensive city in the world, a significant difference from its 71st place last year; Manama, Bahrain sees its ranking at 71st, differing from 91st last year; Doha is 76th, up from 99th last year; Muscat comes in at 94th, jumping from 117th last year; Kuwait City is 103rd, also climbing from 117th position in 2015; lastly Jeddah is 121st, a change from 151st last year.

Rob Added: “These rankings uniquely combine day-to-day expenditure on goods and services such as food, clothing and transportation, with rental prices.  While prices of most goods and services are considered to be cheaper in Saudi Arabia compared with Europe, it is the expatriate rental market that pushes cities like Riyadh and Jeddah up the ranking.”  He also added: “What this means is that once again, cities in our region have become more expensive to send people to, with expatriates expecting increased cost of living and housing allowances. To the contrary, when sending staff out of the Middle East, multinationals have to be wary that cost of living allowances are likely to go down, and have to clearly explain and communicate this to their staff to avoid lengthy discussions.”

The Americas

Cities in the United States have climbed in the ranking due to the strength of the US dollar against other major currencies, in addition to the significant drop of cities in other regions which resulted in US cities being pushed up the list. New York is up five places to rank 11, the highest-ranked city in the region. San Francisco (26) and Los Angeles (27) climbed eleven and nine places, respectively, from last year while Seattle (83) jumped twenty-three places. Among other major US cities, Honolulu (37) is up fifteen places, Washington, DC (38) is up twelve places, and Boston (47) is up seventeen spots. Portland (117) and Winston Salem, North Carolina (147) remain the least expensive US cities surveyed for expatriates.

Senior Partner and President of Mercer’s Talent Business, Ilya Bonic said, “Despite mild price increases overall, most cities in the US have climbed in the ranking, primarily due to a strong US dollar.”

In South America, Buenos Aires (41) ranked as the costliest city despite a twenty-two place drop from last year. San Juan, Puerto Rico (67) follows as the second most expensive location in the region, climbing twenty-two spots. The majority of other cities in South America fell as a result of weakening currencies against the US dollar despite price increases on goods and services in countries, such as Brazil, Argentina, or Uruguay. In particular, São Paolo (128) and Rio de Janeiro (156) plummeted eighty-eight and eighty-nine places, respectively, despite a strong increase for goods and services. Lima (141) dropped nineteen places while Bogota (190) fell forty-two places. Managua (192) is the least expensive city in South America. Caracas in Venezuela has been excluded from the ranking due to the complex currency situation; its ranking would have varied greatly depending on the official exchange rate selected.

Canadian cities continued to drop in this year’s ranking mainly due to the weak Canadian dollar. The country’s highest-ranked city, Vancouver (142), fell twenty-three places. Toronto (143) dropped seventeen spots, while Montreal (155) and Calgary (162) fell fifteen and sixteen spots, respectively.

Europe and Africa

Two European cities are among the top 10 list of most expensive cities. At number three in the global ranking, Zurich remains the most costly European city, followed by Geneva (8), down three spots from last year. The next European city in the ranking, Bern (13), is down four places from last year following the weakening of the Swiss franc against the US dollar.

Several cities across Europe remained relatively steady due to the stability of the euro against the US dollar. Paris (44), Milan (50), Vienna (54), and Rome (58) are relatively unchanged compared to last year, while Copenhagen (24) and St. Petersburg (152) stayed in the same place.

Other cities, including Oslo (59) and Moscow (67), plummeted twenty-one and seventeen places, respectively, as a result of local currencies losing significant value against the US dollar. London (17) and Birmingham, UK (96) dropped five and sixteen places, respectively, while the German cities of Munich (77), Frankfurt (88), and Dusseldorf (107) climbed in the ranking.

Ilya Bonic also provided his opinion on these figures saying: “Despite some marked price increases across the region, several local currencies in Europe have weakened against the US dollar which pushed a few cities down in the ranking, Additionally, other factors like recent security issues, social unrest, and concern about the economic outlook have impacted the region.”

A few cities in Eastern and Central Europe climbed in the ranking as well, including Kiev (176) and Tirana (186) rising eight and twelve spots, respectively.

Despite dropping off the top spot on the global list, Luanda, Angola (2) remains the highest ranking city in Africa. Kinshasa (6) follows, rising seven places since 2015. Moving up one spot, N’Djamena (9) is the next African city on the list, followed by Lagos, Nigeria (13) which is up seven places. Dropping three spots, Windhoek (209) in Namibia ranks as the least expensive city in the region and globally.

Asia Pacific

This year, Hong Kong (1) emerged as the most expensive city for expatriates both in Asia and globally as a consequence of Luanda’s drop in the ranking due to the weakening of its local currency. Singapore (4) remained steady while Tokyo (5) climbed six places. Shanghai (7) and Beijing (10) follow. Shenzhen (12) is up two places while Seoul (15) and Guangzhou, China (18) dropped seven and three spots, respectively.

On this, Ilya Bonic provided the following analysis: “The strengthening of the Japanese yen pushed Japanese cities up in the ranking, however, Chinese cities fell in the ranking due to the weakening of the Chinese yuan against the US dollar.”

Mumbai (82) is India’s most expensive city, followed by New Delhi (130) and Chennai (158). Kolkata (194) and Bangalore (180) are the least expensive Indian cities ranked. Elsewhere in Asia, Bangkok (74), Kuala Lumpur (151) and Hanoi (106) plummeted twenty-nine, thirty-eight, and twenty places, respectively. Baku (172) had the most drastic fall in the ranking, plummeting more than one hundred places. The city of Ashkhabad in Turkmenistan climbed sixty-one spots to rank 66 globally.

Australian cities have witnessed some of the most dramatic falls in the ranking this year as the local currency has depreciated against the US dollar. Brisbane (96) and Canberra (98) dropped thirty and thirty-three spots, respectively, while Sydney (42), Australia’s most expensive ranked city for expatriates, experienced a relatively moderate drop of eleven places. Melbourne fell twenty-four spots to rank 71.

Mercer produces individual cost of living and rental accommodation cost reports for each city surveyed. For more information on city rankings, visit www.mercer.com/col. To purchase copies of individual city reports, visit https://www.imercer.com/products/cost-of-living.aspx or call Mercer Client Services in Warsaw on +48 22 434 5383.

-ENDS-

 

Top 10 cities Ranking

Mercer Cost of Living Survey – Worldwide Rankings 2016

(The Mercer international basket, including rental accommodation costs)

Rank as of March

City

Country

2015

2016

2

1

HONG KONG

Hong Kong

1

2

LUANDA

Angola

3

3

ZURICH

Switzerland

4

4

SINGAPORE

Singapore

11

5

TOKYO

Japan

13

6

KINSHASA

Dem. Rep. of the Congo

6

7

SHANGHAI

China

5

8

GENEVA

Switzerland

10

9

NDJAMENA

Chad

7

10

BEIJING

China

Source: Mercer’s 2016 Cost of Living Survey

 

Bottom 10 cities Ranking

Mercer Cost of Living Survey – Worldwide Rankings 2016

(The Mercer international basket, including rental accommodation costs)

Rank as of March

City

Country

2015

2016

180

200

LUSAKA

Zambia

188

201

GABORONE

Botswana

205

201

KARACHI

Pakistan

204

203

TUNIS

Tunisia

200

204

MINSK

Belarus

191

205

JOHANNESBURG

South Africa

186

206

BLANTYRE

Malawi

207

207

BISHKEK

Kyrgyzstan

200

208

CAPE TOWN

South Africa

206

209

WINDHOEK

Namibia

Source: Mercer’s 2016 Cost of Living Survey

 

 

 

 

CONTACT INFORMATION