Mercer Canada | 2016 Cost of Living Survey

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Weak Canadian dollar makes Canadian cities attractive for expatriates, but challenging for Canadian employers

  • June 22, 2016
  • Canada, Toronto, ON

Continued demand for mobility in the global workforce challenged by cost of expatriate packages
Vancouver remains Canada’s costliest city in Mercer’s 22nd annual Cost of Living Survey

  • Canadian cities drop significantly in this year’s ranking due to the weak Canadian dollar
  • Vancouver remains the costliest city in Canada at 142, followed closely by Toronto at 143, Montreal (155), Calgary (162) and Ottawa (171)

Toronto, Wednesday
Despite volatile global markets and growing security issues, organizations continue to leverage global expansion strategies to remain competitive and to grow. Yet, few organizations are prepared for the challenges world events have on their business, including the impact on cost of expatriate packages. Mercer’s 22nd annual Cost of Living Survey finds that factors including currency fluctuations, cost inflation for goods and services, and instability of accommodation prices, contribute to the cost of expatriate packages for employees on international assignments.

“Despite technology advances and the rise of a globally connected workforce, deploying expatriate employees remains an increasingly important aspect of a competitive multinational company’s business strategy,” said Ilya Bonic, Senior Partner and President of Mercer’s Talent business. “However, with volatile markets and stunted economic growth in many parts of the world, a keen eye on cost efficiency is essential, including a focus on expatriate remuneration packages. As organizations’ appetite to rapidly grow and scale globally continues, it is necessary to have accurate and transparent data to compensate fairly for all types of assignments, including short-term and local plus status.”

According to Mercer’s 2016 Cost of Living Survey, Hong Kong tops the list of most expensive cities for expatriates, pushing Luanda, Angola to second position. Zurich and Singapore remain in third and fourth positions, respectively, whereas Tokyo is in fifth, up six places from last year. Kinshasa, ranked sixth, appears for the first time in the top 10, moving up from thirteenth place.

Other cities appearing in the top 10 of Mercer’s costliest cities for expatriates are Shanghai (7), Geneva (8), N’Djamena (9), and Beijing (10). The world’s least expensive cities for expatriates, according to Mercer’s survey, are Windhoek (209), Cape Town (208), and Bishkek (207).

Mercer's widely recognized survey 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 375 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.

“Maximizing return on investment with fewer resources and talent shortages worldwide makes growth initiatives more difficult for multinationals,” said Mr. Bonic. “Organizations must ensure they can facilitate the moves they need to drive business results by offering fair and competitive compensation packages.”

Mr. Bonic added that costs of goods and services shift with inflation and currency volatility making overseas assignment costs sometimes greater and sometimes smaller. Low levels of inflation have translated into fairly steady cost increases around the world.

The Americas
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, with Ottawa rounding out the list of Canadian cities at 171.

“While the cost of living continues to rise in Vancouver and Toronto for locals, the weak Canadian dollar has made these cities compelling for expatriates from organizations outside the country,” said Gordon Frost, Talent Leader, Mercer Canada. “However, the depressed dollar provides a challenge to Canadian organizations looking to place employees in cities around the world.” 

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.

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. 

Europe, the Middle East, 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. 

“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,” explained Nathalie Constantin-Métral, Principal at Mercer with responsibility for compiling the survey 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.

Tel Aviv (19) continues to be the most expensive city in the Middle East for expatriates, followed by Dubai (21), Abu Dhabi (25), and Beirut (50). Jeddah (121) remains the least expensive city in the region despite rising thirty places. “Several cities in the Middle East experienced a jump in the ranking, as they are being pushed up by other locations’ decline, as well as the strong increase for expatriate rental accommodation costs, particularly in Abu Dhabi and Jeddah,” said Ms. Constantin-Métral.

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.

“The strengthening of the Japanese yen pushed Japanese cities up in the ranking,” said Ms. Constantin-Métral. “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. 

Mercer Cost of Living Survey ñ Worldwide Rankings 2015
(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
16
11
NEW YORK CITY United States
14
12
SHENZHEN China
9
13
BERN Switzerland
20
13
LAGOS Nigeria
8
15
SEOUL South Korea
17
16
VICTORIA Seychelles
12
17
LONDON United Kingdom
15
18
GUANGZHOU China
18
19
TEL AVIV Israel
35
20
ABUJA Nigeria
23
21
DUBAI United Arab Emirates
32
22
OSAKA Japan
42
23
BRAZZAVILLE Congo
24
24
COPENHAGEN Denmark
33
25
ABU DHABI United Arab Emirates
37
26
SAN FRANCISCO United States
36
27
LOS ANGELES United States
30
28
LIBREVILLE Gabon
26
29
NANJING China
27
30
TIANJIN China
21
31
SHENYANG China
39
32
NOUMEA New Caledonia
24
33
QINGDAO China
29
34
CHENGDU China
42
34
CHICAGO United States
22
36
CONAKRY Guinea
52
37
HONOLULU United States
50
38
WASHINGTON United States
28
39
YANGON Myanmar
55
40
DJIBOUTI Djibouti
19
41
BUENOS AIRES Argentina
31
42
SYDNEY Australia
41
43
TAIPEI Taiwan
46
44
PARIS France
56
45
MIAMI United States
63
45
DHAKA Bangladesh
49
47
DUBLIN Ireland
62
47
ACCRA Ghana
64
47
BOSTON United States
44
50
BEIRUT Lebanon
53
50
MILAN Italy
54
50
AMMAN Jordan
60
50
YAOUNDE Cameroon
56
54
VIENNA Austria
80
54
NAGOYA Japan
58
56
ABIDJAN CÙte d'Ivoire
71
57
RIYADH Saudi Arabia
59
58
ROME Italy
38
59
OSLO Norway
76
60
PORT OF SPAIN Trinidad & Tobago
71
61
WHITE PLAINS United States
77
62
DALLAS United States
 
62
BANGUI Central African Republic
67
64
HELSINKI Finland
69
64
AMSTERDAM Netherlands
127
66
ASHKHABAD Turkmenistan
50
67
MOSCOW Russia
89
67
SAN JUAN Puerto Rico
48
69
PERTH Australia
78
70
DOUALA Cameroon
47
71
MELBOURNE Australia
88
71
MORRISTOWN United States
91
71
MANAMA Bahrain
45
74
BANGKOK Thailand
92
75
HOUSTON United States
99
76
DOHA Qatar
87
77
MUNICH Germany
103
78
ATLANTA United States
83
79
DAKAR Senegal
75
80
MANILA Philippines
104
81
PANAMA CITY Panama
74
82
MUMBAI India
106
83
SEATTLE United States
106
84
STOCKHOLM Sweden
82
85
ABERDEEN United Kingdom
94
86
LUXEMBOURG Luxembourg
102
86
BRUSSELS Belgium
79
88
BANDAR SERI BEGAWAN Brunei
90
88
HO CHI MINH CITY Vietnam
98
88
FRANKFURT Germany
115
91
MINNEAPOLIS United States
120
91
CAIRO Egypt
99
93
JAKARTA Indonesia
110
94
SAN JOSE COSTA RICA Costa Rica
117
94
MUSCAT Oman
66
96
BRISBANE Australia
80
96
BIRMINGHAM United Kingdom
61
98
AUCKLAND New Zealand
65
98
CANBERRA Australia
106
100
BERLIN Germany
99
101
ISTANBUL Turkey
71
102
ADELAIDE Australia
117
103
KUWAIT CITY Kuwait
122
103
DETROIT United States
115
105
MADRID Spain
86
106
HANOI Vietnam
114
107
DUSSELDORF Germany
70
108
SANTIAGO Chile
130
108
ST. LOUIS United States
124
110
BARCELONA Spain
133
110
CLEVELAND United States
130
112
PITTSBURGH United States
124
113
HAMBURG Germany
111
114
RIGA Latvia
120
115
BAMAKO Mali
104
116
NAIROBI Kenya
135
117
PORTLAND United States
142
118
PHNOM PENH Cambodia
83
119
MONTEVIDEO Uruguay
109
119
GLASGOW United Kingdom
151
121
JEDDAH Saudi Arabia
111
122
POINTE A PITRE Guadeloupe
83
123
WELLINGTON New Zealand
133
124
COTONOU Benin
142
124
PRAGUE Czech Rep.
149
126
GUATEMALA CITY Guatemala
154
127
QUITO Ecuador
40
128
SAO PAULO Brazil
139
129
STUTTGART Germany
132
130
NEW DELHI India
140
130
CASABLANCA Morocco
144
132
LOME Togo
147
132
LYON France
127
134
BELFAST United Kingdom
145
134
LISBON Portugal
137
136
BRATISLAVA Slovakia
136
137
ATHENS Greece
162
137
TASHKENT Uzbekistan
97
139
KIGALI Rwanda
129
139
COLOMBO Sri Lanka
122
141
LIMA Peru
119
142
VANCOUVER Canada
126
143
TORONTO Canada
162
143
ADDIS ABABA Ethiopia
96
145
PORT AU PRINCE Haiti
153
146
OUAGADOUGOU Burkina Faso
157
147
WINSTON SALEM United States
165
148
SANTO DOMINGO Dominican Rep.
155
149
NIAMEY Niger
155
150
TALLINN Estonia
113
151
KUALA LUMPUR Malaysia
152
152
ST.PETERSBURG Russia
160
152
KINGSTON Jamaica
161
154
LJUBLJANA Slovenia
140
155
MONTREAL Canada
67
156
RIO DE JANEIRO Brazil
168
157
HARARE Zimbabwe
157
158
CHENNAI India
167
159
ZAGREB Croatia
169
160
NURNBERG Germany
177
160
SAN SALVADOR El Salvador
146
162
CALGARY Canada
159
162
LIMASSOL Cyprus
93
164
MAPUTO Mozambique
170
165
BUDAPEST Hungary
172
165
LEIPZIG Germany
171
167
VILNIUS Lithuania
175
168
RABAT Morocco
137
169
MEXICO CITY Mexico
 
170
HAVANA Cuba
162
171
OTTAWA Canada
33
172
BAKU Azerbaijan
178
172
BUCHAREST Romania
179
174
DAR ES SALAAM Tanzania
174
175
PORT LOUIS Mauritius
184
176
KIEV Ukraine
175
177
WARSAW Poland
173
178
NOUAKCHOTT Mauritania
202
179
BANJUL Gambia
183
180
BANGALORE India
188
180
ISLAMABAD Pakistan
187
182
SOFIA Bulgaria
165
183
ASUNCION Paraguay
195
184
LA PAZ Bolivia
181
185
ALGIERS Algeria
193
186
TIRANA Albania
184
187
KAMPALA Uganda
190
188
TEGUCIGALPA Honduras
192
189
YEREVAN Armenia
148
190
BOGOTA Colombia
150
190
BRASILIA Brazil
199
192
MANAGUA Nicaragua
196
193
BELGRADE Serbia
193
194
KOLKATA India
196
195
SARAJEVO Bosnia and Herzegovina
94
196
ALMATY Kazakhstan
182
197
MONTERREY Mexico
198
198
TBILISI Georgia
203
199
SKOPJE Macedonia
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 2015 Cost of Living Survey
 
 

 

Notes for Editors
The list of rankings is provided to journalists for reference and should not be published in full. The top 10 and bottom 10 cities may be reproduced in a table.

The figures for Mercer’s cost of living and rental accommodation costs comparisons are derived from a survey conducted in March 2016. 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 the demand for data.

About Mercer
Mercer is a global consulting leader in health, wealth and careers. Mercer helps clients around the world advance the health, wealth and performance of their most vital asset – their people. Mercer’s more than 21,000 employees are based in more than 40 countries and the firm operates in over 130 countries. Mercer is a wholly owned subsidiary of Marsh & McLennan Companies (NYSE: MMC), a global professional services firm offering clients advice and solutions in the areas of risk, strategy and people. With 57,000 employees worldwide and annual revenue exceeding $13 billion, Marsh & McLennan Companies is also the parent company of Marsh, a leader in insurance broking and risk management; Guy Carpenter, a leader in providing risk and reinsurance intermediary services; and Oliver Wyman, a leader in management consulting. For more information, visit www.mercer.ca. Follow Mercer on Twitter @MercerCanada.

Mercer also provides advice and market data on international and expatriate compensation management, and works with multinational companies and governments worldwide. It maintains one of the most comprehensive databases on international assignment policies; compensation practices; and data on worldwide cost of living, housing, and hardship allowances. Its annual global mobility conferences and other events provide companies with the latest trends and research on mobility issues. Visit https://www.imercer.com/EU/tabs/gm.aspx for details. Follow Mercer’s mobility news on Twitter @MercerMobility.

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