SINGAPORE: Traditionally-costly Singapore has ranked seventh on Mercer’s latest Cost-of-Living report – which measures the cost-of-living for expatriates in major foreign cities. But the gold medal spot has been stolen by a little-known Central Asian capital, and it’s not for economically positive reasons.
Ashgabat, the capital of Turkmenistan, tops this year’s list of most expensive cities for international employees, followed by another regular member of the top ten, Hong Kong and then Beirut. The capital of Lebanon climbed 42 positions in the ranking as a result of the unstable political environment, and sometimes desperate shortages of food and energy.
The Covid-19 pandemic has caused highly ranked cities to be divided into two groups. Those such as Singapore (seventh), Hong Kong (second) and Shanghai (sixth) rank high for desirability and demand-side reasons, and those that sadly rank highly for hardship, supply-side and inflationary reasons.
Tokyo (fourth) and Beijing (ninth) remained regular placeholders from Asia.
The pandemic has resulted in a number of consequences that are particularly relevant to Singapore, Mercer’s report advised. “The crisis has accelerated changes in global mobility trends and practices, prompting companies to rethink their strategies for managing mobile workforces in the post-pandemic world,” it said, noting that high costs remain among the main obstacles to mobility.
“Companies are looking for opportunities to replace traditional long-term assignments with alternative, less costly forms of mobility, such as one-way transfers, short-term assignments and internationally or locally hired foreigners.”
Virtual assignments are also finding great favour among multinational employers.
Remote and hybrid working have been gaining popularity as the solutions of choice for many employees in Singapore.
"With the rise of remote working and the increasing demand for employee-requested moves, understanding the cost of living in different locations is crucial for companies setting up compensation packages and employees concerned about their purchasing power abroad", added the report.
The Cost of Living Survey highlights the importance of monitoring currency fluctuations and assessing the inflationary and deflationary pressures on goods, services and accommodation in all operating locations, all factors exacerbated by the pandemic. Interestingly, the latest data show few significant price variances resulting from the pandemic as various measures were adopted by governments worldwide.