Mercer said the cost of living has had a ’significant impact’ on employees, citing rising housing costs in many cities proving a challenge for expat staff.
London has entered the top 10 list of most expensive cities to live in, according to a financial services industry ranking.
Hong Kong and Singapore retained the top and second spots from last year respectively, followed by four Swiss cities: Zurich, Geneva, Basel, and Bern. New York City is in seventh place, then London, Nassau in the Bahamas, and Los Angeles in the United States.
Mercer, a business of Marsh McLennan, compiles the data to help multinational businesses plan compensation packagers for employees working overseas and said the increase was due to factors including rental prices and general cost-of-living expenses.
The firm said inflation trends and rising housing costs has had a “significant impact” on multinationals, not only putting a strain on compensation packages for staff being relocated to big cities abroad, but making it difficult for firms to attract and retain staff.
High Living Costs
“The cost-of-living crisis has already had a significant impact on the mobile talent employed by multinational organizations,” Mercer said in its report.
It continued: “High living costs have required some assignees to adjust their lifestyles and cut back on discretionary spending. Some employees have even struggled to meet their basic needs.”
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London prices were the highest in England, at 10.6 percent.
Price Movements
In their study, Mercer measured some prices of everyday items including groceries. In London, a dozen eggs costs 3.6 percent more in March 2024 than it did 12 months before, while olive oil was up 48.3 percent and a woman’s haircut had jumped 7.2 percent.
The Russian invasion of Ukraine, a major exporter of food products, was also a main contributor to rising prices in 2022.
