“Considering only the European continent, Lisbon is the 36th most expensive city for expatriates”, concludes the study “Cost of Living 2022”, launched by the consultancy firm Mercer, which includes 227 cities in the world where expatriate workers live, verifying that the standards of international employee mobility are evolving as a result of the exchange rate and inflation and the increase in remote and flexible working.
The study was carried out from the joint analysis of the comparative cost of more than 200 items in each location, including housing, transportation, food, clothing, household products and entertainment, and using New York as the base city for all comparisons.
In the global ranking, Hong Kong is once again the most expensive city in the world for expatriates, a position it has held for consecutive years.
According to the “Cost of Living 2022” study, the Swiss cities of Zurich (2nd), Geneva (3rd), Basel (4th) and Bern (5th) complete the top five most expensive locations in the world for expats.
On the European continent, in addition to the four cities in Switzerland, the ranking is led by country capitals, namely Copenhagen (Denmark), which globally appears in 11th place, London (United Kingdom, 15th), Vienna (Austria, 21st), Amsterdam (Netherlands, 25th) and Oslo (Norway, 27th).
In the top-10 of the most expensive European cities for expatriates is the German city of Munich, which appears in 33rd position in the global ranking.
Lisbon, the only Portuguese city to be included in the study, dropped 26 positions in the global ranking, becoming the 109th most expensive city in the world in terms of cost of living for expatriates and the 36th in Europe, ranking below the middle of the table of 57 European cities, behind cities such as Madrid (90th place worldwide) or Barcelona (78th).
For Eastern Europe, the most expensive city is Prague (Czeki), which ranks 60th out of 227 cities, followed by Riga (Latvia, 79th), Bratislava (Slovakia, 105th) and Tallinn ( Estonia, 140th), says the study, indicating that the cheapest is Sarajevo, in Bosnia and Herzegovina, ranked 209th in the world and at the bottom of the table of European cities.
“The rise of remote and flexible working, the war in Ukraine, currency fluctuations and widespread inflation are having a material impact on employee compensation, which can have serious consequences for companies in the global battle for talent”, points out the report.
Tiago Borges, 'business leader career' at Mercer, quoted in a statement about the study, says that “the volatility triggered by Covid-19 and exacerbated by the crisis in Ukraine has fuelled global economic and political uncertainty”, a situation that is reflected “with the significant rise in inflation in most countries around the world”, which worries expatriates about their purchasing power and socio-economic stability.
“Both inflation and exchange rate fluctuations directly influence the purchasing power of employees working outside their country of origin”, explains Tiago Borges, noting that the increase in remote and flexible work has also led many employees to reconsider their priorities , the balance between work and family life and the choice of place of residence.
The data presented in the Mercer study, in addition to demonstrating that “working and economic conditions around the world are evolving faster than ever before”, allow companies to assess the costs of international contracts in times of uncertainty.