Mumbai is the most expensive city in the world: Mercer Survey
Cost of living survey 2018 was released by Global Consulting firm Mercer. Aging populations, skills shortages, and unpredictable political and economic contexts, the landscape of global business is changing as a result of digital era because jobs that are critical for future work.
According to Mercer’s Global Talent Trends 2018 analysis- India indicates that the three topmost priorities the C-suite considers includes improving the ability to move jobs to people and people to jobs which will have a vital impact on the business performance. The central aspect of many organizational growth strategies are the issues surrounding global talent mobility which even includes on whom to mobilize, where and what to pay in the framework of measuring the cost of expatriate packages for their international assignees. Factors like low inflation, instability of housing markets and fluctuating prices for goods and services are said to be impacting the cost of doing business in different cities around the world according to Mercer’s 24th annual Cost of Living Survey.
Mumbai as compared to the other cities like Melbourne (58), Frankfurt (68), Buenos Aires (76), Stockholm (89) and Atlanta (95) of the world is ranked higher and more expensive. A continuous rise in the prices of food, alcohol and domestic supplies is said to be responsible for Mumbai’s jump in the ranking. Whereas Cities like Melbourne and Buenos Aires have witnessed a downfall in their ranking.
However, New Delhi (103), has experienced drop in the rankings by four positions managing to claw its way out of the top 100 categories this year. A major drop was witnessed by Chennai (144) for about nine spots. However, the change in movement of other cities in the list also affects the ranking of the state. New Delhi shows a comparative rise in the cost of living due to rise in sports & leisure related category of services, cost of transportation following Mumbai’s footsteps whereas in the Chennai the higher side is taken by the prices of alcohol and clothing.
Bengaluru (170) has driven significantly by a relative drop in prices on transportation, which even includes the fair of taxi cab, auto parts and even the cost of autos which dropped its cost of living rank. Kolkata (182) thus has moved up two spots but still remains the least expensive among the surveyed Indian cities. The rise in spots is basically due to increase in costs of domestic supplies and home services.
“According to Mercer’s International Policies and Practices Report on India, Cost of Living Allowance for their expatriate assignee is what through which 93% of the Indian companies compensate. Along with currency exchange rate this increase in prices of goods in our cities was also viewed which has directed an impact on the Indian assignee compensation when using a balance sheet approach, making assignment costs sometimes greater and sometimes smaller overseas. In such scenarios the frequent expatriate salaries reviewed by the company is being reconsidered. Some companies prefer to let the assignee retain the benefit of a windfall if applicable in balancing assignee cost with assignee satisfaction”, said Padma Ramanathan, India Practice Leader, Global Mobility at Mercer.
Multinationals are focusing on mobile talent and assessing the cost of expatriate packages for their international assignees for embracing this transformation. “Deploying talent remains a key component of a multinational’s business strategy, with technology advances and the importance of a globally connected workforce” said Ilya Bonic, President of Mercer’s Career business. “While a mobile workforce permits an organizations to achieve larger efficiency, be cost effective with international projects, utilize top talent slowing economic growth in many parts of the world and volatile markets require them to carefully assess expatriate remuneration packages.”
Cities other than India appearing in the top 10 of Mercer’s costliest cities for expatriates are Seoul (5), Luanda (6), Shanghai (7), N’Djamena (8), Beijing (9), and Bern (10). Tashkent (209), Tunis (208), and Bishkek (207) are the world’s least expensive cities for expatriates
All comparisons, and currency movements are measured against the US dollar for this survey of global ranking where New York City is used as the base. Over 375 cities throughout the world for this survey. 209 cities across five continents housing, transportation, food, clothing, household goods, and entertainment including comparative cost of more than 200 items in each location are included in this survey. (PTI).
